A Review of the Nigerian Energy Industry

PENGASSAN, NUPENG threaten to shut down oil production amid strike

11 January 2012, Sweetcrude, LAGOS – Nigeria’s oil workers threatened on Wednesday threatened to shut down the country’s crude oil production as a nationwide strike over soaring fuel prices pushed on for a third day.

With the Nigerian organised labour and government locked in a showdown that has patralysed Nigeria for three days, the Petroleum amd Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and its counterpart for the junior cadre worfkers, National Union of Petroleum and Natural Gas Workers (NUPENG) said they would make a decision later in the day on whether to shut down crude production and exports completely.
“We are not on the streets today because by the evening … the national leadership of the oil workers will announce its decision on when to shut down production as well as export terminals,” Chika Onuegbu, national industrial relations officer of PENGASSAN told Reuters.
A definite decision to strike had yet to be made, but he added: “That will mark the beginning of the next phase of the protest against the removal of fuel subsidy and it will be very disastrous for the country.”
On his part, Tokunbo Korodo, Lagos head for NUPENG, said: “We are contemplating shutting down oil production.
“We are just waiting for the outcome of discussions between labour and government today (Wednesday). The outcome of that meeting, if not favourable, will lead us to shutting down oil production.”
While the strike that started on Monday has virtually paralysed the country and brought tens of thousands out into the streets nationwide, oil production has not been affected so far.
The strike was called over a government move to end fuel subsidies on January 1, which caused petrol prices to more than double in Africa’s most populous nation where most people live on less than $2 per day.
Unions are calling on the government to return fuel prices to 65 naira per litre ($0.40, 0.30 euros), the level before January 1.
Nigeria produces around 2.4 million barrels of oil per day and exports over two million barrels per day.
Oil industry officials said a complete halt to oil exports was unlikely because processes are automated and some workers non-unionised. However, even a small dent in output would heap pressure on President Goodluck Jonathan’s government, which relies on crude exports for 95 percent of Nigeria’s foreign exchange earnings and most of its state revenue.
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