Nigeria’s Oil Workers’ Union Threatens to Shut Down Chevron

Nigeria’s Oil Workers’ Union Threatens to Shut Down Chevron

The National Union of Petroleum and Natural Gas (NUPENG), and the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), have directed members of their labor union in Chevron to embark on a strike action.

The labor union said in a statement that its members will commence a total shutdown of operations in Chevron to protest the oil company’s decision to lay off 600 Nigerian employees, and its other anti-labor practices.

NUPENG’s President, Williams Akporeha, and the president of PENGASSAN, Festus Osifo, in the statement, also urged the federal government to intervene as the development runs contrary to Nigerian labor laws.

“We have directed our members in Chevron to withdraw their services. We also call on the Federal Government to call Chevron Management to order, otherwise we can no longer guarantee industrial peace in the oil and gas sector.

“Here is our fatherland and we have a labour law that regulates the activities of organizations in Nigeria; this law cannot be breached; we must follow the process. This development runs contrary to Nigeria’s laws regulating the Oil and Gas Industry as it does not protect our national interest.

“This is an imperialist agenda that must not be allowed to stay; most especially as we have just finished celebrating our 60th independence as a sovereign country,” the statement said.

The news broke that Chevron had informed about 2,000 of its employees on Independence Day that their services are no longer needed. The aggrieved employees said the company plans to replace them with expatriates. And according to the union leaders, Chevron management is asking the affected employees who wish to remain with the company to apply afresh.

However, the proposed shutdown will unlikely force Chevron to reinstate the sacked workers as it appears the layoff was compelled by COVID-19 realities.

Responding to the development earlier, Chevron’s General Manager, Policy, Government and Public Affairs, Esimaje Brikinn said the company places priority on the welfare and safety of its workforce, but the step is necessary to keep the company in business.

“Making changes to the organization is never easy for anyone that will be impacted, but it is to improve our ability to remain competitive in Nigeria. Reducing the cost of our operations is critical to generating more revenues for the Federal Government of Nigeria,” he said.

Other oil companies did the same.

The oil industry is among the hardest hit by COVID-19 pandemic, forcing companies in the sector to take drastic survival measures that include laying off staff.

Chevron’s rival Shell, cut its 2020 expenditure plans by $5 billion to $20 billion as the strains of the pandemic hit the oil market. The Dutch company has since explored other ways to save costs, including job cuts.

Shell Chief Executive Ben van Beurden said the company has launched a program of “redesign” that is aimed at cutting operational cost to the barest minimum. He said in July that Shell was working to deliver $3 billion to $4 billion in cost savings by the end of March 2021, and the measures include job cuts and suspending bonuses.

British Petroleum announced plans in June to cut 10,000 jobs following the decline in oil demand. The company’s Chief Executive Bernard Looney said oil price plunged well below the level the oil giant needs to turn a profit. “We are spending much, much more than we make – I am talking millions of dollars, every day,” he said.

With the global economic turmoil wreaking havoc on the oil industry, Chevron is clearly following the steps of other oil companies to stay afloat. Oil prices are still wobbling around $40 per barrel, and many sectors of the global economy yet to fully reopen, the survival of oil companies appears to depend solely on reducing operational cost, including cutting jobs.

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