Thai Workers Protest Unpaid Wages at Chonburi Clean Fuel Project
Thousands of workers and employers, representing 24 Thai subcontracting companies, march and submit a petition demanding payment from the CFP main contractors in Sriracha district, Chonburi Province on October 18, 2024.
CHONBURI — Over 3,000 workers and employers, representing 24 Thai subcontracting companies, gathered to march and submit a petition demanding payment from the foreign main contractors of the Clean Fuel Project.
The Federation of TOP Refinery Contractors for the Clean Fuel Project (CFP), an oil refinery in Sriracha district, Chonburi province, organized a march on October 18. Formed by 24 Thai subcontracting companies with over 3,000 employers and workers, they aimed to submit a letter to the CFP project executives and the Governor of Chonburi Province. The letter urged pressure on UJV – Samsung, Petrofac, and Saipem, the main contractors, to pay overdue installments
Previously, on October 15, the Federation of TOP Refinery Contractors, formed by 16 Thai subcontracting companies, held a press conference demanding that Thai Oil, the owner of the CFP project, clarify how they will proceed in case subcontractors can no longer take care of workers due to not receiving payments for over 6 months.
Thai Oil Issued Statement
On October 16, Thai Oil Public Company Limited issued a statement explaining that the company has already paid compensation to UJV – Samsung, Petrofac, and Saipem, the main contractors for the CFP project construction, according to the conditions specified in the Engineering, Procurement and Construction (EPC) contract.
Upon learning about the Federation of TOP Refinery Contractors’ press conference regarding their demands, Thai Oil sent inquiry letters to UJV – Samsung, Petrofac, and Saipem, and UJV’s parent company. UJV confirmed that they will continue to pay the overdue compensation according to the subcontract conditions and requested Thai Oil not to interfere with subcontractors, as Thai Oil is not a party to these subcontracts.
“Thai Oil has consistently adhered to good governance principles for transparent business operations with all stakeholders and is aware of the hardships faced by subcontracting companies. We will make every effort to consult with UJV – Samsung, Petrofac, and Saipem to follow up and inquire about management measures and alleviating the hardships for subcontracting companies as soon as possible,” the statement said.
20,000 Workers Are at Risk
Regarding the march by employers and workers of the TOP Refinery Contractors Federation on Friday, they stated that they are facing severe problems due to foreign main contractors delaying construction payments. Despite subcontractors having completed work as per contracts since February 2024, totaling several billion baht, this has severely impacted the financial liquidity of over 100 subcontracting companies and 20,000 workers.
Moreover, some subcontractors have had to continue working without compensation to avoid being sued for damages, leading to prolonged liquidity issues without adequate remediation or assistance from relevant parties.
This delay in construction payments has caused widespread severe impacts on the country’s energy security. As the oil refinery construction project is crucial for strengthening national energy security, any delay or disruption directly affects long-term energy development plans. It also severely impacts the livelihoods of thousands of workers and their families who have been or are about to be laid off.
“This situation may lead to widespread social problems such as increased crime or mental health issues in communities. It also affects confidence in project owners in Thailand, severely damaging the image and credibility of large-scale national project owners, in which the Ministry of Finance indirectly holds top-ranking shares, potentially causing long-term future impacts,” TOP Refinery Contractors Federation stated
The Federation also called on the government and indirect shareholders of the project owner to find more effective ways to alleviate hardships and protect the interests of all parties to support the project’s continuation.
First Large-scale Project in EEC
The Clean Fuel Project has a total project value of $4.825 billion. The project owner, Thai Oil Public Company Limited, held a foundation stone laying ceremony for the main production control building of CFP in 2020 at the Thai Oil refinery in Sriracha district, Chonburi province. The then Minister of Energy, Mr. Sontirat Sontijirawong, presided over the ceremony.
Thai Oil stated that the CFP project enhances the refinery’s competitiveness by expanding refining capacity from 275,000 barrels per day to 400,000 barrels per day, creating economies of scale, reducing production costs, increasing flexibility in crude oil reception, allowing the refinery to increase the proportion of Heavy Crude by 40-50%, and adding value to products by converting fuel oil into aviation fuel and diesel. It also enables the production of Euro 5 standard gasoline and diesel.
The CFP project is considered the first large-scale private sector investment project within the Eastern Economic Corridor (EEC) area. It was originally scheduled to be completed in 2023, but due to the severe impact of the pandemic in 2021-2022, construction has been delayed until now.
Source: https://www.khaosodenglish.com/news/2024/10/18/thai-workers-protest-unpaid-wages-at-chonburi-clean-fuel-project/
