Oil workers have accused the Federal Government of deliberately hindering the efficient and effective functioning of the four state-owned refineries in a bid to sell them to its cronies without considering available options and rational rule for such lucrative business deal.
The workers, under the auspices of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the National Union of Petroleum and Natural Gas Workers (NUPENG) accused the government of purposely underfunding the refineries and deliberately refused to carry out Turn-Around Maintenance (TAM) and supply crude to the refineries so as to have reasons for selling them to cronies.
They said that instead of opting for the outright sale of the refineries, the Federal Government should adopt a modified model tailored towards the Nigerian Liquified Natural Gas (NLNG) Model with the National Oil Company (NOC) as owners of the four refineries holding a substantial minority share, while core investors/local participation hold the working majority with the staff, trade unions, and the host communities hold minority shares.
Speaking against the backdrop of the plan by the Federal Government to privatise the four refineries by 2014, PENGASSAN President, Comrade Babatunde Ogun, said that the workers will resist the privatisation of the four state-owned refineries because it is against the national interest.
He alleged that government should deal with the problem of vandalisation of pipelines that hamper supply of crude oil to the refineries as well as carry out TAM and see whether the refineries will work or not.”
He noted that the issue of the privatisation of the refineries has been on the front burner since President Olusegun Obasanjo’s administration, when the government, through the Bureau for Public Enterprises (BPE), hastily sold the refineries, adding that this step was reversed by the late President Umaru Musa Yar’Adua.
Ogun said: “The proposed sale of the refineries is against the overall national interest and in the interest of the few, who are lurking around the corridor of power to milk the country dry. How can a country be selling all its national assets all in the name of privatisation? For whose benefit are such sales?
“If you recall, the late President Yar’Adua reversed the privatisation of the refineries done by former President Obasanjo, with a promised to carry out Turn-Around Maintenance (TAM) on them to ensure that they are sold not as scrap. On assumption to office, President Goodluck Jonathan also promised to carry out TAM on the refineries.
“Even the controversial Kalu Idika Kalu-led National Refineries Special Task Force also has TAM or rehabilitation of the refineries to make the refineries work in a safe and reliable manner as part of its recommendations. As we are talking now, nothing has been significantly done.
“Why is the government proposing sale of these national edifices without doing the needful to ensure that the refineries work at their optimal capacity? Nigerians and the general public deserve to know more on the desperate reasons for the spate and row of proposed privatisation, even when the selfish motives of these proposed national assets sales can spell doom for the country.”
He said that the government can also consider Part 1 Section 3 of a Senate Bill 176, which tries to ensure 50 per cent refining capacity in the country, and states that “Nigerian personnel shall constitute a minimum of seventy five per cent of the investing company in accordance with this law.”
He also said the refineries should be stand-alone entities independent of either the current Nigerian National Petroleum Corporation (NNPC) or the proposed NOC as in the Petroleum Industry Bill (PIB), while the board of management of each refining company should be fully responsible for its success and failure.
Ogun said that those that are planning to sell the refineries and their cronies planning to buy them should emulate Alhaji Aliko Dangote and establish their own refineries instead of waiting to corner the nation’s common investment interest for their own selfish interest.
He also stated that instead of privatising the refineries, government should grant effective incentives to allow for the development of private refineries alongside the existing ones, adding that a framework should be articulated that will make available required crude for effective functioning of local refineries.
“There is need to incentivise and/or compel IOCs to refine an agreed percentage of crude oil in the country. A suggestion is to tie upstream licensing to downstream investment and private ownerships of jetties should be encouraged,” he said.
He stated: “As the privatisation trend continues, the Nigeria public will need to know from the process drivers the number of jobs and investment that have been created as against the reality that some cronies are now being recruited as technical partners to front for the high and mighty as was the case with Eleme Petrochemicals Company Limited which the Government sold to Indorama for $225 million for a mega plant that is the second largest in Africa which at the time of its sale worth about $2.5 billion as fair market value. Also at the time of the sale, the company was fully stocked feeds, and the materials needed for its TAM were being bought by the government. It only required working capital that was persistently caused by bureaucratic bottleneck and undue government interference that delayed its efficiency.
“Also, the downstream oil and gas sector companies where government has substantial ownership equity like Unipetrol, Africa Petroleum and National Oil were doing well with over 6,000 Nigerian employees before their privatisation.
“These companies are now going into oblivion with less than 1,200 workers made up over 85 per cent casual employees and 15 per cent regular staff despite guarantees of better management by the core investors. The sad story with the privatisation of Air Nigeria and NICON is well known to the Nigerian public.”
