Offshore Alliance says it has applied to the Fair Work Commission for a protected action ballot order, stating Inpex's Ichthys LNG project, in northern Australia, had offered workers a "dodgy pay deal".
The union is reportedly demanding salaries of over half a million dollars, along with increased allowances, automatic promotions, guaranteed bonuses, and generous travel perks.
Chamber of Minerals and Energy WA chief executive Aaron Morey says the wage claim is "a union-driven cash grab that doesn't pass the pub test".
"At a time when our gas is helping secure fuel and fertiliser for the nation, these claims put Australian families at risk," he said on Thursday.
The alliance's actions were driving investment offshore, which would ultimately hurt the very workers it claimed to represent, Mr Morey said.
"Deliberately and aggressively pursuing industrial conflict risks trashing Australia's reputation at the worst possible time," he said.
"Direct, good-faith bargaining has delivered world-leading pay and conditions in Australia's offshore LNG sector.
"These latest claims are not credible."
Labour costs in the sector could rise by more than 50 per cent without lifting productivity, if the union is successful.
This would weaken Australia's competitiveness and undermine future investment needed to sustain jobs, exports and energy security, Mr Morey said.
The Australian Resources and Energy Employer Association said the claims were detached from economic reality and risked setting an unsustainable precedent across the sector.
"These are not responsible or incremental claims," association deputy chief executive Tara Diamond said.
"They are an attempt to significantly lift pay and allowance structures for a workforce that is already among the highest paid in Australia."
Inpex employees typically earned between $300,000 and $400,000 per year, and the union claims would push wages beyond $500,000 per annum on average, Ms Diamond said.
The association said the alliance's bargaining and campaigning across the offshore LNG industry had become increasingly aggressive.
"It is a co-ordinated campaign model that combines unsustainable claims with a deliberate escalation toward industrial action," Ms Diamond said.
The union's recent public statements have foreshadowed industrial action and drawn comparisons to previous offshore disputes, threatening prolonged disruption and significant financial losses.
When disputes escalate, the impacts flow through to production, supply chains and the broader economy.
The association said the timing of the possible industrial action increased the risk of shortages.
"In a period of heightened global energy demand and ongoing fuel supply and pricing pressures, maintaining stable and reliable operations is critical," Ms Diamond said.
The Offshore Alliance, made up of the Australian Workers Union and the Maritime Union of Australia, said its protected action ballot order application was a "major escalation" after more than six months of stalled negotiations.
Bargaining failed to deliver meaningful progress on pay, job security, and conditions for 400 highly skilled but frustrated workers, it said.
Inpex has refused to agree to core claims and the company's latest enterprise agreement offer was below industry-standard and rejected by alliance members.
"Inpex has left workers with no other choice," Offshore Alliance spokesman and AWU assistant national secretary Chris Donovan said.
"Our members are united, they are determined, and they are ready to fight for an agreement that reflects the value of the work they do."
Workers would vote yes for protected industrial action, it said.
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