Oil Workers’ Strike Costs Nigeria N57.4 Billion in Three Days
Nigeria suffered significant production losses during a recent nationwide oil workers’ strike, with daily crude oil output dropping by more than 200,000 barrels, according to senior officials. The industrial action also disrupted gas production and electricity generation across the country.
NNPC Ltd Group Chief Executive Officer, Bayo Ojulari, revealed these impacts during a briefing at the Presidential Villa in Abuja following his meeting with President Bola Tinubu on Monday. The three-day strike resulted in an estimated loss of $39.6 million (N57.4 billion) in crude oil revenue, calculated at an average price of $66 per barrel.
The industrial action, initiated by the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), was sparked by a labor dispute with Dangote Petroleum Refinery and Petrochemicals. The conflict began when the refinery terminated approximately 800 Nigerian workers, citing alleged sabotage activities that threatened the safety and operations of its 650,000-barrel-per-day facility.
In a formal communication signed by Femi Adekunle, a Dangote Group human resource manager, the company defended the dismissals as necessary to protect the refinery from recurring sabotage incidents that compromised operational efficiency. The terminations took effect from September 25.
However, PENGASSAN contested this explanation, arguing that the mass dismissal was actually retaliation against workers who had joined the union. The organization also claimed the refinery planned to replace the dismissed Nigerian workers with expatriates.
The situation escalated when PENGASSAN directed its members to block gas supply to the refinery in protest. Dangote refinery responded by declaring the action illegal, stating that PENGASSAN had no authority to interfere with third-party vendor contracts for gas and crude oil supply.
The strike was ultimately suspended last Wednesday after negotiations between PENGASSAN and Dangote refinery management resulted in an agreement. This resolution came following intervention from the federal government, though the specific terms of the agreement were not disclosed.
The incident highlights the delicate balance between labor rights and industrial operations in Nigeria’s crucial oil sector, while also demonstrating the significant economic impact that such disputes can have on the nation’s oil production and revenue.
