French strike to disrupt energy sector-UPDATE 1

Trade the News

Monday September 06, 2010 06:38:12 AM GMT

* Strikers to cut refinery output at Total refineries-union

* EDF workers to cut 20,000 MW in electricity capacity-union

* Tuesday strike is a major test for unions

(Updates with quotes, details and background)

By Muriel Boselli and Mathilde Cru

PARIS, Sept 6 (Reuters) - A nationwide strike planned in France on Tuesday to protest planned pension reforms is likely to partially disrupt the energy sector, union and industry officials said on Monday.

Protests against a bill setting out the biggest overhaul of the country's pay-as-you-go pensions system since the early 1980s would have to become a regular occurrence to have a major impact on the supply of energy in the French market, traders said.

This is the fourth day of action against the reforms since March and constitutes a major test for the unions.

The powerful CGT union said Total refinery strikers were likely to cut output runs and suspend fuel deliveries from four plants, while electricity workers were expected to cut production capacity at EDF's 58 nuclear reactors.

"There will be output cuts, a halt in refined product supplies and no maintenance at all refineries except at Feyzin (southwest France), which did not vote for the strike," Charles Foulard, CGT union coordinator at Total, told Reuters.

The Total refineries involved have an output capacity of 828,000 barrels per day (bpd) out of the company's total refining capacity in France of 1 million bpd. A Total spokesman said he expected strikes to hit refineries on Tuesday but declined to give further details.

"We will give a strike update tomorrow morning," he said.

But oil product traders said they expected the strike to have a small and short-term effect.

"I guess if they become a regular event, they will be a bit more of a nuisance," one London-based trader said.

Another CGT official said striking workers at EDF, the world's largest electricity producer, would cut production capacity by at least 20,000 megawatt (MW), which represents around 20 percent of the country's power production capacity.

He also expected one out of two EDF workers to down tools.

"The ultimate impact of the strike could be power cuts, but we are responsible," the union official said, adding that this was not the aim of the strike.

"We have to ensure the supply/demand balance is maintained," he added.

However, the capacity cuts could hit industries and electricity exports to neighbours, he said.

The impact on gas supplies was expected to be limited as French gas storage facilities are full after the summer, the official said, adding that strikers would not unload liquefied natural gas ships. (Editing by Jane Baird)

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