LABOR negotiations close at Farmland refinery in Coffeyville

<br>WICHITA, Kan. (AP) _ With gasoline prices soaring at the pump, rumors of a possible labor strike at Farmland's refinery in Coffeyville has raised fears that a shutdown there could spur even higher

Thursday, August 30th 2001, 12:00 am

By: News On 6

WICHITA, Kan. (AP) _ With gasoline prices soaring at the pump, rumors of a possible labor strike at Farmland's refinery in Coffeyville has raised fears that a shutdown there could spur even higher gas prices.

But negotiators for Farmland and the unions said Wednesday there has been no talk of strike _ and negotiations are progressing so well that there is a possibility of a contract vote as early as Friday evening.

Plant manager Keith Osborn said Wednesday a strike is unlikely.

``We continue to talk and we don't see it going that far at this point in time,'' Osborn said in a telephone interview in between negotiation sessions.

That assessment was echoed by the union's negotiator Mike Blake, who said no strike authorization vote has even been taken, nor have negotiations broken down to the point that a federal mediator has been called in. He said they are a long way from a strike, and may actually be close to an agreement.

``I'm not saying that it is a done deal, I'm saying that is a possibility,'' said Blake, an electrician at the facility and the president of the metal trades council.

The refinery, which employees 306 workers, is negotiating with its six unions through their metal trades council. About 200 workers are represented by one of those unions, and their contract expires at 11:59 p.m. Friday.

If no contract agreement is reached by that time, negotiators will extend the contract to the next negotiation meeting until it is resolved _ just as they have done in the past, Blake said.

The refinery is a key supplier in the Midwest, especially for the Kansas City area. Its Coffeyville facility processes 90,000 barrels of crude oil per day, said Farmland spokeswoman Sherlyn Manson.

Even if there is a strike at the Coffeyville plant, it is ``certainly a possibility'' that the refinery would continue to operate, Osborn said.

The negotiations come at a time when refineries are already operating at full capacity to keep up with demand after two refineries shut down in Illinois, one after a fire and the other to make improvements.

On Tuesday, the federal government temporarily relaxed standards on the gasoline produced and sold by Citgo Petroleum Corp. in the Midwest in an attempt to alleviate a recent price spike in the region.

The move was intended to help Citgo make up for a production shortfall that began Aug. 14, when a fire forced the Tulsa, Okla.-based company to close its 160,000 barrel-a-day refinery in Lemont, Ill.

Gas prices have risen nearly 10 cents per gallon nationwide since the Lemont refinery fire. But its impact was magnified in the Midwest, where markets have been tight since January, when Premcor Inc. shut down its 80,000 barrel-a-day Blue Island, Ill., refinery to make improvements.

Gasoline prices have been hoovering at the $1.80-per-gallon mark in the Wichita area.

The high gas prices prompted U.S. Sen. Sam Brownback to tell local businessmen at a Wichita Area Chamber of Commerce meeting Wednesday that he couldn't help but wonder at the spike's timing _ just before the long Labor Day weekend.

But he quickly added that previous investigations have found no proof of price manipulation by the industry.

Brownback said the problems are symptomatic of the lack of a national energy policy, and said he was hopeful Bush's energy bill can get on the floor for discussion.