PENGASSAN rejects Tinubu’s Executive Order on NNPCL

By Victor Ahiuma-Young

The Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, has called on President Bola Tinubu to immediately withdraw the Executive Order, EO, directing the direct remittance of oil and gas revenues to the federation account, warning that it could put in danger about 4,000 jobs and destabilise the industry.

Briefing newsmen in Lagos, PENGASSAN President, Festus Osifo, described the directive as a direct attack on key provisions of the Petroleum Industry Act, PIA, enacted in 2021 to reform and stabilise the sector.
Osifo said: “What are we telling the investors? What are we telling the international community? That just with an executive order, you can set aside the law of the land? This is an aberration. This should never have happened. The actual percentage that gets there eventually is somewhere below two percent and the 30 percent Frontier Exploration Fund does not go directly to NNPC Limited but into a designated Frontier Exploration Account. Some provisions in the EO did not tell the entire truth.”

Clarifying that royalties are paid into the Federal Government’s account, not personal accounts of regulators, Osifo warned of looming job losses if the order remains.

“If this is allowed to sit through the way it is today, in the next few months, our members are in danger of being declared redundant because the company may not be able to meet their obligations,” he said.
He recalled the union’s role in shaping the PIA to restore confidence after nearly a decade of declining investments, saying “We had to believe that with that piece of legislation, there would be some level of certainty in the industry. The people who are coming to invest will know what the rules of engagement are. If you don’t stabilise your own environment, the investors will take their money elsewhere.

“Our major revenue earner as a country is oil and gas. The more money we earn from the industry, the more we can defend our naira. If production is impacted and foreign exchange earnings reduce, it will affect our exchange rate, and once the exchange rate is impacted, it will affect our pockets.”

Describing the oil and gas business as capital-intensive, with some rigs costing up to $1.5 million per day, he said: “It is not a one-dollar business. It is a multi-billion-dollar industry. That is why we must not allow investors to flee.”

Osifo said the union was not consulted on the Executive Order, noting that it was earlier informed of a proposed executive bill to amend the PIA.

“The information at our disposal was that there was going to be a bill. But instead of a bill, it came as an executive order. We were not carried along in any way,” he said.

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