The Guardian April 16, 2003

Mobil move explodes "partnership" myths

by Bob Briton

Last week the South Australian Government's Economic Development Board 
(EDB) convened an economic summit. Speakers from business, government, 
trade union and community organisations held forth on the many challenges 
facing the ailing SA economy.

Bob Hawke  the consummate conciliator  chaired a number of sessions, as 
was entirely appropriate. The conference (and the EDB itself, for that 
matter) was an election promise of the Mike Rann-led ALP opposition just 
over a year ago.

The proposal was an attempt to show that the Labor Party still had that 
ability it supposedly had in the Hawke/Keating years to see the "big 
picture" of managing a capitalist economy.

In scenes reminiscent of the Accord years, when similar conferences took 
place in the old Federal Parliament House in Canberra, the House of 
Assembly chamber was given over to discussion of South Australia's worrying 
economic situation.

The air was thick with talk about "revitalising" the public sector (and 
cutting it), streamlining the bureaucracy to facilitate business, promoting 
the "clever" state and, of course, "new partnerships" between governments, 
corporations and workers to achieve presumed mutually held ambitions.

The majority of contributors carried on in this vein even though Exxon 
Mobil had effectively put a bomb under most of its cherished notions just a 
couple of days before when it announced the closure of the Port Stanvac 
refinery and the loss of 400 hundred jobs.

Another 1500 related jobs are directly threatened by the announcement.

Locally refined fuel apparently costs between $18.40 and $19.40 a barrel to 
produce while fuel from Mobil's huge Singapore refinery can be landed for 
$19 even. For some reason, fuel sourced from Port Stanvac is thus to be 
deemed woefully uneconomic, as is fuel from virtually all other Australian 

A recent survey of oil companies operating in Australia said that they lost 
$472 million between them in 2001, which translates to negative 10.6 per 
cent return on investment.

These mysteries of oil company mathematics are the reason given for Mobil's 
decision to move to warmer climes.

In the past their alleged problems have been used to resist even the most 
modest claims from unions whenever an EBA came up for renewal. They have 
been used to gain a considerable amount of corporate welfare from 
successive state governments.

Opposition industry spokesman Rob Lucas said a mouthful during the week 
when he told the press: "Former governments in the past have worked quietly 
with management and we've seen the survival of Port Stanvac."

Two years ago, State Parliament voted to reduce Mobil's local government 
rates to the Onkaparinga Council from $1.2 million to $500,000.

In 1994 charges on imports of crude oil were abolished. Wharf services fees 
of about $150,000 were written off.

However, these and other taxpayer funded sweeteners have simply been 
pocketed by this largest of the word's corporations and have not 
successfully cemented the hoped for "partnership".

Anger in the community has been heightened by the trademark secretiveness 
of the company. Right up to the day before the announcement, Mobil 
representatives were claiming to be "undecided" about the refinery's 

The morning the bombshell was dropped, the logistical manager for the Asia 
Pacific region just happened to be at the site, as were staff from Beyond 
Services. They were there to offer financial planning tips and advice on 
alternative employment to the soon-to-be redundant workers.

Bluster from the state government has died down very quickly. The toughest 
of their threats now relates to the cleaning up of the 350ha site that 
Mobil has occupied for the last 40 years.

The Environment Protection Authority (EPA) has called for more stringent 
legislation to legally force companies to remediate contaminated sites. The 
EPA currently has very little power to insist on such "good citizenship" 
and no power at all when it comes to contamination committed before 1995.

Company government relations manager Alan Bailey said that Mobil was ". 
quite happy to meet our environmental obligations . we will have no problem 
with what was proposed by the EPA."

Mobil has dismissed as fanciful claims from a former employee broadcast on 
a Channel 7 Current Affairs program that asbestos and various chemical 
residues had been buried in pits on the site over a number of years.

Mobil wants to cease production of fuel in May this year and lubricants in 
July. It would prefer to mothball the plant or use it as a "tank farm" for 
others to store chemicals until profits from refining become more to their 

State Treasurer Kevin Foley is quick to damp down any talk of compulsorily 
acquiring the land: "To move into Parliament with legislation is an 
extremely bold move by any government and we would need to think that one 
through in the clear light of day."

Mobil agrees. Alan Bailey added "It creates a less secure environment for 
future investment if governments take action like that without reasonable 

So there you have it. Though experiences like this latest one with Exxon 
Mobil have caused a reduction in the numbers of open advocates of corporate 
handouts, there is still a chorus of people wanting "alliances" and 
"partnerships" with the bosses.

The problem is that the "partner" with nearly all the economic and 
political clout in this instance has squeezed what it wants out of SA and 
has decided to go and form "partnerships" with the people of Singapore and 
India instead.

It would be naove to expect corporations to behave in any other way.

Clearly discussions are needed and some timely decisions on how the 
organised labour movement can effectively re-engage in the class struggle.

Action needs to be taken in the context of a wider campaign to form a 
people 's government that will put major economic assets under public 
ownership. Please spare us another rehash of the message that bosses and 
workers have common interests.

Back to index page