A COMPANY that supplies crude oil to Crown Central Petroleum Corp. has told the Baltimore-based company that it won't renew its contract when it expires in about two years or expand its business with the company until Crown resumes normal relations with union workers locked out of a refinery near Houston as a result of a labor dispute.

The Oil, Chemical & Atomic Workers International Union (OCAW), which has been battling the company, reported the decision by the Norwegian company Statoil, which was confirmed by the company. But Joseph M. Coale III, Crown's director of corporate communications, said that since the two-year contract with Statoil was renewed in August 1998, the decision doesn't have any immediate impact on the company.

But it marks an escalation in an ongoing battle between Crown, which also operates 70 convenience stores, 124 mini-marts and 142 gasoline stations, and the OCAW that has resulted in boycotts and other actions. Statoil had been asked to pull out of its contract with Crown by the Norwegian Oil and Petrochemical Workers Union.

"We have a two-year deal with Crown, and we're enjoying a good relationship there," said Sigurd Jansen, president of Statoil's U.S. marketing and trading subsidiary. "What will happen after the two-year contract is confidential."

Statoil supplies 35,000 barrels of crude oil a day to Crown's refinery in Pasadena, Tex., which refines approximately 100,000 barrels of crude oil a day into gasoline and other products.

The dispute between Crown and the OCAW began in February 1996 when Crown locked out 252 refinery operators who were members of the OCAW and brought in nonunion workers. The company said it acted in response to acts of sabotage and vandalism at the refinery, which included "spray-painting important instructions" and putting sand in pumps, according to Coale.

The union said that Crown had attempted to provoke a strike at the refinery and locked out the workers when it became clear that the union didn't plan to strike. Crown has said it proposed 162 permanent jobs at the refinery, in the heart of a heavily industrialized suburb adjacent to southeast Houston and the Houston Ship Channel. The OCAW, in addition to enlisting the help of the Norwegian union, has rallied environmental groups against Crown and has won an endorsement for its national boycott of Crown service stations and Zippy Mart and Fast Fare convenience stores by the National Baptist Convention USA, the nation's largest African American church organization.

Copyright 1998 The Washington Post Company