United Steelworkers members at bp's 440,000-barrel-per-day refinery in Whiting, Indiana, rejected the company's offer to extend their contract by 28 days at the largest refinery in the U.S. Midwest, the company said in a statement.
United Steelworkers Local 7-1, which represents around 800 workers at Whiting, said in a statement to members on its website that the two sides remain apart, but workers should report to work as scheduled to ensure the facility's safe operation.
"While there is no intent to have a work stoppage, we need to be prepared," the union said. "Our plans for strike or lockout have been initiated. We ask that you not be alarmed by this activity. We will continue to bargain with the goal of reaching an agreement that is mutually beneficial."
"bp remains committed to negotiating in good faith with the USW to improve the competitiveness of our business and create a sustainable future for all", the company said in an emailed statement to Reuters.
The union has previously said bp proposed cutting more than 200 union jobs in operations, maintenance and environmental safety.
It said in its statement that there were differences over issues such as seniority, layoffs and wages.
The Whiting refinery produces transportation fuels including gasoline, diesel fuel and jet fuel.
The union did not immediately respond to requests for further comment.
