SOUTH AMERICA

Unions draw line in sand after workers burned

UNION protests are expected to slow output from Petrobras' 323,000 barrel a day Landulpho Alves r...

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Union officials said the injured workers at RLAM were using an electric rotary sander on the inside of a hydrogen tank that had been drained on Thursday and where workers had previously done the same work without incident.

While the company would not say whether the accident would impact oil processing or fuel output, it would not affect fuel supplies to Brazilian consumers.

The explosion occurred in the U-38 hydrogen generation unit which has no production directly related to it, according to Thomson Reuters refinery data.

The protests show workers have had enough of ongoing safety concerns at Petrobras' 14 Brazilian refineries, which have been operating near full capacity to meet domestic demand that has grown faster than its ability to supply it.

Union officials said that while crude prices nearly halving since June means that Petrobras was no longer losing money on gasoline and diesel imports, the state-owned oiler may still not be able to shut units and perform upgrades.

Pertrobras is currently dealing with a price-fixing, bribery and political kickback scandal which has isolated it from capital markets and led it to stop paying for or working with some of Brazil's most important construction and engineering firms, many of whom were the same ones which build, expand and repair Petrobras refineries.

"Thousands of contract workers at the refineries are being laid off and work is shutting down," Reuters reported Simao Zanardi, head of legal and institutional affairs for FUP, Brazil's national oil workers' federation, as saying.

"It is our feeling that most of Petrobras' refineries are not operating as safely as they should be."

The refinery also suffered a fire in its paraffin unit last Wednesday after a faulty valve at the plant, Petrobras' oldest, leaked kerosene. No one was injured.

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