Redundancies at Bolaños Mechanical Engineering as electricity contract is terminated

Employees contracted at Bolaños Mechanical Engineering Company will be entering a consultation period after the company’s contract with the Gibraltar Electricity Authority was terminated.

The announcement was made yesterday as a spokesman for No.6 Convent Place explained that Gibraltar now has an independent source of power with the capacity and infrastructure at the new LNG Power Station.

Both the GEA and the Gibraltar Government displayed their commitment in supporting these employees affected by the termination of this contract, which ends on June 30.

Unite the Union said it had been informed of the termination of the contract and the redundancies and would work to mitigate the impact on Bolaños’ employees.

The GEA entered into a contract with Bolaños in February 2013 after terminating its contract with OESCO.

At first the company was contracted for an initial term of six months to assist with the generation of power to meet Gibraltar’s power requirements but this was extended in line with increasing demands from the community.

“Bolaños originally operated the ex-OESCO generating engines but these were subsequently replaced with more efficient, and environmentally friendly, temporary generating sets,” the Government spokesman said on behalf of the Gibraltar Electricity Authority.

“In April 2014, a catastrophic fire engulfed the Waterport Power Station as a result of a generating engine failure, which considerably extended the need for Bolaños’ continued assistance in ensuring the resilience of Gibraltar’s generating capacity.”

“Following the completion of the new LNG Power Station and its handover to the GEA in January 2021, as well as the decommissioning of the Waterport Power Station in December 2020, it is no longer necessary to continue with the arrangements with Messrs Bolaños and the GEA will therefore finalise the agreement with Bolaños with effect from the 30th June 2021.”

Bolaños has now met with its employees and has engaged the trade unions in order to initiate the redundancy consultation process, in line with local employment legislation, the Government spokesman added.

For its part, the GEA said it will be working to support Bolaños and its employees in mitigating the impact of this contract being finalised.

The Government of Gibraltar said it will also work with employees to provide them with support and assist them in finding alternative employment within the private sector in Gibraltar.

“The GEA has worked successfully with Bolaños since the original contract was entered into and the GEA is therefore grateful to the company and all of their employees for their diligent and dedicated work during this time,” the GEA said.

“The termination of the arrangements come about as a direct result of the needs of the community now being adequately provided for by the GEA’s new LNG power station at the North Mole.”

Unite’s Gillian Birkett told the Chronicle that she had been formally informed by Bolaños of the development on April 29

“Unite has today [Tuesday] had a general meeting at the power station with all members impacted by the situation, followed by an initial meeting with Bolaños management in order to initiate the consultation process,” she said.

“Unite will also be meeting government officials and the Employment Director tomorrow in order to find a way forward and try and mitigate the impact of this unwelcome situation.”