Shell plans to begin layoffs for nearly 700 workers in March at its Convent oil refinery, which it expects to fully shut down in August.
The Louisiana subsidiary of Royal Dutch Shell, Equilon Enterprises LLC, previously had announced layoffs but has now filed an official notice with the Louisiana Workforce Commission outlining its plans.
Shell looks to lay off all 698 workers at the refinery, 340 of whom are represented by a union, according to the letter.
The company is still offering a voluntary severance program for some workers at its Norco refinery near New Orleans, opening the possibility of placing some workers there and at a chemical plant in Geismar that it operates. The Norco plant is unionized; the Geismar plant is not. To make room for some of the laid-off workers, early retirement and buyouts would be key.
The United Steelworkers union negotiated with the company about severance packages for laid-off union members in early November. The union contract won't expire until 2022.
"Negotiations went well," said Marty Poche, the USW representative for Local Union 13-750. "We have been working together to try and provide placement for as many of those affected employees. Hopefully we will be able to do so."
It was not immediately clear how many jobs might be available. That process is expected to begin during first-quarter 2021.
"Most of those folks will be working through most of next year to safely shut down, decommission and preserve the facility," Poche said.
The company began the shutdown process in mid-November, when some of the 400 contractors who worked on the site left.
Shell sought to sell the refinery, which processes more than 211,100 barrels of crude oil each day, but has not found a buyer. The Shell Convent refinery has not been profitable for several years, even before the decline in demand for gasoline prompted by travel restrictions during the coronavirus pandemic.
The company is in the process of consolidating its refinery portfolio and investing in a more integrated petrochemical complex instead. It looks to produce more biofuels, hydrogen and synthetic fuels as Shell positions itself for a transition to a low-carbon future because customers are asking for lower carbon products.
Two other oil refineries in Louisiana are laying off workers as the profit margin for producing gasoline and jet fuel has tanked in recent months: Krotz Springs and Calcasieu Refining Co.
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