WestStar pay slash
 

Hearing numerous murmurings that all is not happy at WestStar (Africa). It is underperforming financially and pay cuts of up to 30-40% have been issued. Are these across the board? Does the pay cut also effect Malaysia? Is it temporary with light at the end of the tunnel?

I can't speak for Weststar Africa but the recent oil price turmoil is forcing another round of structural change and as usual, its contractors across the board which are exposed to a new deeper cost cutting round being undertaken.

I think that there will be a number of helicopter operators negotiating with their workforce for changes to pay and conditions. More flexible working conditions are definitely going to be a part of negotiations. There are going to be some tough discussions but maintaining current work practices, pay and conditions is unlikely in the current offshore market.

It's a fact of the industry that at the moment the oil companies are enjoying the balance of power in their favour and are doing an excellent job of driving their supply chain into very dark places. I'm hearing numerous oil companies (NOCs are the worst) asking for newer ac and tech upgrades for below supplied cost come contract renewal time. Our industry is not sustainable at the moment. So many operators would now be better off deliberately giving up work on a 'no bid' basis than keeping the loss making contracts they have now. We are also at risk of an entire strata of oil company procurement departments getting very comfortable having only ever had access to lots of options for all oilfield services and not being used to having to pay a healthy market rate for it. It's actually quite worrying.

On the specifics of Weststar, they run their Africa operation out of Europe and it's legally a separate entity to the rest of the company. I'd be extremely surprised if what happened in Africa is required to be replicated in Malaysia legally but on principle Weststar might carry the cuts across to try and preserve some money at the corporate level.