Economy threatened as unions protest NNPC restructuring

The country’s economy is coming under threat  as the oil services sector’s two unions embarked on strike yesterday, protesting the restructuring of the Nigerian National Petroleum Corporation (NNPC) by the Federal Government.

The striking unions are the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN)  and National Union of Petroleum and Natural Gas  Workers of  Nigeria (NUPENG).

The implication of the strike is that the productive capacity of the country’s industries and services, which depend mostly on alternative power sources, driven by fuel oils, including diesel and petrol, will likely be undermined, as fuel supply by agencies which have huge union membership could be shut off, as has happened in the past.

The cost of transport for commuters and merchandise will also rise if the strike persists, while many Nigerian households would be shrouded in darkness for want of fuel to power their electricity generators, in the face of prolonged outages from the national grid.

The NNPC through its subsidiary the Pipeline and Products and Marketing  Company (PPMC) supplies  about 75 per cent  of  fuel around  the country.

Reacting to the strike, Ibe Kachikwu, minister of State for Petroleum,  yesterday said the

Federal Government was not unbundling but reorganising NNPC.

Kachikwu, who spoke to journalists at the Presidential Villa, Abuja said he was concerned about the misconception, as the NNPC had not been broken into separate entities.

Chambers  Oyibo, former  group managing  director  of the  NNPC said  much as there is nothing wrong  in the reorganisation  of  the  corporation,  it is  also important  that  the workers  are  carried  along in  the stages of the exercise.

Lumumba Okugbawa, the general secretary of PENGASSAN, reacting  to  the development, described the action by the Muhammadu Buhari government as tantamount to policy summersault.

According to Okugbawa,  the restructuring plan would scare off investors from the nation’s oil and gas industry,  when what the nation needs now is foreign investment.

He said the government did not take into consideration, the existing law establishing the NNPC, before planning 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.

“There are many issues such as pensions and transfer of the employees, which are provided for in the NNPC Act of 1977. What will happen to all these provisions of the law?

“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 amount 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 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 organisation and before any unilateral statement capable of heating up the industrial climate is made,” said Okugbawa.

Some other  officials of  the   NNPC  who spoke to BusinessDay, alledged  that the  minister  does  not  believe  in consulting  with stakeholders  before   taking any  policy  decision  since   he assumed  office.

They said they were not against reforms but that due process should be followed and that one of these is consultation with all stakeholders.

Chambers Oyibo   said   government has  the right  to unbundle , restructure and  rearrange the  corporation but observed that in previous exercises, the  workers  were carried along.

“What we did in the past was that when we wanted to carry out such exercises, the workers  were always  informed. We told them what we wanted to achieve by the action and how we intended to carry them out.

This  is  because  they  are  the one  that  would carry  out   what  ever  plan we  intend  to  implement.”

Sena Anthony, former legal adviser  and  secretary  of the  NNPC, told BusinessDay  that  what the minister has done was   just a  reorganisation  of the entity.

“ It is  reorganisation and any   company  has the right  to set up subsidiaries. It is still a single holding company, still a legal entity and not sold off yet and there is no job loss”, she said.

She said she did not really understand why the unions  were reacting  the way  they were  doing, because  what the minister has  done was better  for the  company,  as many  of  the  junior workers would have opportunities to grow.

Emmanuel Ibe Kachikwu, minister of state for Petroleum Resources and Group Managing Director (GMD) of NNPC, announced on Tuesday, the unbundling of NNPC into seven units and 20 companies with different management.

Angry workers, under the aegis of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the National Union of Petroleum and Natural Gas Workers (NUPENG), were at the gates leading to the NNPC Towers in Kaduna, as early as 6.30am on Wednesday to prevent workers and others from entering the premises.

Meanwhile activities at the  Kaduna  Refinery have been grounded.

Olusola Bello, JOSHUA BASSEY  &  YANGE IKYAA