NNPC Workers Strike Over Proposed Company Split

NNPC Workers Strike Over Proposed Company Split
NNPC workers are staging a nationwide strike over plans to "unbundle" the state-run oil firm into 30 companies.

Nigerian National Petroleum Corporation (NNPC) workers are staging a nationwide strike over plans to “unbundle” the state-run oil firm into 30 companies.

Senior staff in Nigeria’s oil and gas industry have opposed the proposed changes, according to the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) trade union, which stated that workers believe the plan sends the wrong signal to the investment world.

Commenting on the issue, PENGASSAN Acting General Secretary Lumumba Okugbawa said in a statement from the union that the move by the government “will be tantamount to policy summersault”. Okugbawa said the unbundling plan will put off investors at a time when the nation needs foreign spending most and explained that the government did not take into consideration an existing law that established the NNPC before plans were in place to unbundle the corporation.

“There is an existing NNPC Act of 1977 that set up the NNPC. This Act has many provisions that deal with structure and operations of the corporation,” Okugbawa said.

“For the government to do anything with the current NNPC, the Act must either be repealed or amended to accommodate the planned restructuring. If not done, it will equal to lack of respect for the rule of law on the part of the government.

“The Petroleum Industry Bill (PIB) that is expected to be the legal instrument for the ongoing reforms of the oil and gas industry will be meaningless if the government should introduce plans outside of the reforms. The PIB is germane to the development of the nation’s oil and gas Industry.

“Above all, the various stakeholders, especially the unions, should be involved before any major change is carried out in the organization and before any unilateral statement capable of heating up the industrial climate is made.”

The PENGASSAN acting General Secretary reiterated the association’s call for an all-inclusive Stakeholders’ Forum where all issues confronting the industry can be discussed.

The plan to split up the NNPC as part of an ongoing transformation process was revealed March 3 by the Minister of State for Petroleum Resources and Group Managing Director of the Nigerian National Petroleum Corporation Ibe Kachikwu. Commenting on the proposed changes, Kachikwu stated that he expects the corporation to start making profit by year-end and emphasized that for the Nigerian oil and gas industry to make “remarkable progress”, there is need for all stakeholders in the upstream, midstream and downstream sectors to be on the same page on cost control, contracting circle, technology and environmental issues.

An NNPC spokesperson was not immediately available to confirm the industrial action but a Reuters reporter said gates to the company's head office in the capital, Abuja, were closed as were seven NNPC fuel stations in the city.

Reuters contributed to this article.

A graduate in journalism from Cardiff University, Andreas has eight years of experience as a business journalist. Email Andreas at andreas.exarheas@rigzone.com

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