NNPC restructuring a one-man show – PENGASSAN President

19 March 2016, Lagos – The Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, says it is not opposed to the on-going reforms in the Nigerian National Petroleum Corporation, NNPC. The National President of the Association, Francis Johnson, told our Business Editor, Bassey Udo, that all what its members want was an all-inclusive arrangement for all interest groups in the industry.

NNPC Towers

NNPC Towers, Abuja


PT: The oil workers unions seem uncomfortable with the on-going restructuring of the NNPC. What are your concerns?

PENGASSAN: For the unions, there must be consistency in policy formulation and implementation by government. Again, there must be an informed consensus on all issues affecting the industry. There must be a buy-in by everyone – government, players and workers. All interest parties must be on the same page. Everyone must understand the direction the industry is heading. Where there are problems, we should join hands together to solve them

It is not too good for the country that the oil and gas industry, the mainstay of our economy, would show such inconsistency in the way policies are formulated and implemented. We seem to be going one step forward today, and two steps backward tomorrow.

If there are things the government needs to do (I believe there are many) to strengthen the industry and bring it to globally acceptable standards, we must be open and transparent about it, by laying all the cards on the table for all parties to see.

One cannot put one hand on the table and the other under the table and expect others to believe one is sincere about the process.

When the present administration came to office, PENGASSAN presented a comprehensive roadmap to Mr. President on what our members think the industry should be. The roadmap was given full exposure in most media in the country. We also submitted the document to the then Ahmed Joda-led All Progressives Congress, APC Transition Committee.

In the roadmap, PENGASSAN asked government to declare a state of emergency in the oil and gas industry. This is an industry that is grappling with a whole lot of issues, namely crude oil theft (which costs the country billions of dollars over the years), pipeline vandalism, backlog of joint venture cash calls, poor state of refineries, corruption in the importation of petroleum products and subsidy payment to marketers, abuse of Nigerian Content policy, etc.

Also, it looked at the status of the PPPRA (Petroleum Products Pricing Regulatory Agency) and Petroleum Equalization Fund, PEF, viz-a-viz the role of the NNPC in the performance of their mandates.

With the state of emergency proposal, PENGASSAN believed all Nigerians could sit down together to discuss these problems and proffer solutions. But, if government is talking about restructuring and reorganisation of the NNPC now, and the same issues are the key issues the Petroleum Industry Bill, PIB, set to achieve, when did that arrangement change? That is the policy inconsistency PENGASSAN is talking about.

The unions are not aware government has jettisoned these issues in the draft PIB currently before the National Assembly for approval. Yet, government has gone ahead to implement what has not yet been approved. That is clearly a setting for confusion. What is worrisome is: what happens if the National Assembly finally approves something different from what government is already implementing in NNPC?

The unions do not seem to know where the industry is going. The essence of any policy is to build a system that would stand the test of time. We must strive to build a legacy that we would all be proud to be associated with long after we have left the system.

For instance, the NNPC Retail was an idea started by the Gaius Obaseki administration in NNPC. When it was conceived, a lot of people opposed it vehemently. But, Mr. Obaseki saw it through, because he carried everybody along and drove the vision to the end. Today, we can see the benefits.

The need to work together is not only in NNPC. It is applicable in every sphere of the industry and government agencies. At every stage in the decision making process, all parties have the responsibility of letting members of their constituencies know what is going on. If as a union the leadership is not carried along in decisions that affect their interests, how would they explain to members how they would be accommodated?

PT: Are you saying PENGASSAN and its members were left out by management in the decision to restructure the NNPC?

PENGASSAN: Precisely, that is what I am saying, and that is the main grouse of our members. Government cannot successfully carry out such massive restructuring without the workers, who would be used in the implementation of the decisions. Government cannot pretend that is right. It is not done anywhere.

Government cannot successfully restructure NNPC without first laying a solid foundation, by first removing all issues capable of posing problems or frustrating the exercise. The NNPC Act of 1977 that set up NNPC is still there. Just like any legal entity, for government to do anything like unbundling, that Act must either be repealed, or amended, to give a legal backing to that exercise.

The unions are concerned that government don’t seem to know exactly what it wants to do. Initially, it was talking about unbundling. But, when there was so much pressure from the National Assembly, the Minister of State turned around to say government was not unbundling, but restructuring or reorganising NNPC.

For God’s sake, there is no way the unions or anybody would be against any decision that Nigerians are convinced would yield benefits to the people, provided such decisions are open, honest, transparent and with sincerity of purpose. If those fundamental issues are not addressed, it means it is business as usual.

PT: Your tone sounds surprising. The unions had a long meeting with the minister on Wednesday night. At the end, the unions called off the strike, indicating that all concerns were addressed. What were resolutions during the meeting?

PENGASSAN: At that meeting, it was agreed that a tripartite committee, consisting representatives of NNPC management, workers and government be set up urgently. The committee was mandated to look at all the issues and ensure that all parties were on the same page. There was also the issue of timelines and the need for all parties to put all the cards on the table. If any decision is to be taken, let everybody look at it together. But, everything must follow due process.

If government does not follow these basic rules in its handling of these issues, it means nothing has changed from the past. It’s like we are trying to go round in circles. The unions can never be against the interest of anything that would be in the greater interest of Nigerians.

PT: What were those issues the unions tabled at the meeting?

PENGASSAN: The issues included our concerns about the unbundling exercise; labour issues, staff welfare, staff redeployments to the strategic business units, SBUs and how they are going to be protected. There was also the issue of what the group management structure would function under the new arrangement.

But, going forward, to guard against the repeat of this kind of crisis, the major decision affecting the corporation must involve the unions. If people are not made to understand what government is doing and how the thing would affect their interest, there is always a genuine fear that the policy may be sabotaged.

During the meeting, the minister owned up to some mistakes, and promised that going forward things would be done properly.

The politicians would come, and maximum three four years after, they would move on. But, the workers would remain. They want to build a career, without any fear of their career progression being stalled. But, if government says it would bring people into positions, has it first look exhaustively within whether there are no competent hands that can do the job, and who are passionate that the corporation must survive?

If people must be brought from outside, let them compete with those inside, then the best is chosen. In doing that their experiences and qualification must be taken into consideration. Everybody must be made to be happy, and have the belief that there are prospects and a future for their career. PT: Since the meeting, has anything changed in the body language of government that creates fears in the mind of the unions that government might not be sincere?

PENGASSAN: No! But, we have to let Nigerians know our position on these issues so that going forward there would be no friction. If all parties agree that what we are preaching is what we are doing, there would not be any problem. The key is openness and transparency.

PT: A lot of Nigerians, including the National Assembly, seem to be on the side of NNPC reform. How come the oil workers are the only ones that do not seem to see things from that same perspective?

PENGASSAN: No. no, no! Initially it was the way the exercise was being carried out. But, the unions are afraid, not because they do not believe in the reform, but they want to be sure that the way it is done would help build their careers. When they cannot get guarantees that their careers would not be stalled after reaching a certain level, then they have genuine reason to be afraid.

If the workers know that they have nothing to be afraid of; that the company belongs to everybody, and they have potentials to grow to any level, they would not complain. If all the people appointed to positions are from outside, it means the people inside are not competent.

If that is the case, look for a way to make them sit up. Where they have been found wanting, sanction them to serve as a deterrent to others.

PT: Most Nigerians see NNPC as synonymous with corruption, making it difficult for them to be trusted with responsibilities, therefore the need for the reforms?

PENGASSAN: I don’t share that opinion. Since the minister came on board, has there been any instance where any official is found wanting and he wants to sanction such official and the union opposed it? Labour does not condone corruption in any form.

But, look at it this way, because of the high level of political interference in the operations of NNPC and some of its affiliates, we have reason to be afraid. But, we are happy that the President has assured us that there would be minimum interference during his tenure. But, the NNPC is supposed to have a Board. All operating and regulatory agencies are supposed to have a Board. But, it appears the oil and gas industry is not given the priority it deserves. For instance, the Nigerian Extractive Industries Transparency Initiative, NEITI Board was reconstituted recently, like others. Why not NNPC, so that things could be done transparently? At least that would show that no single individual is lording over everybody. When there is a Board, consisting technical professionals than politicians, it would provide the necessary checks and balances, to ensure that things are done with due process. If the Board were to have been in place, the restructuring would not be seen as a one-man show.

PT: But, the National Assembly has already given its support to the minister to go ahead with the reforms. What do the workers really want government to do now?

PENGASSAN: I don’t want it to seem as if I am indicting members of the National Assembly, because they are representing all of us. But, what I have to say is that what is worth doing at all is worth doing properly.

Nigerians have watched and listened to various public presentations by the minister on the issue. He has accepted that his handling of the issue was not very tidy, particularly the non-involvement of all stakeholders.

When one sees Nigerians lambasting the unions as selfish, for protesting against the decision, they have to be careful the way they look at these things. During the January 2012 fuel subsidy protest, it was the union that rose against the decision to remove the subsidy, because we believed the high price of fuel would affect the entire economy.

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