95% of factories shut down, $34m-a-day losses & More: The last NUPENG/PENGASSAN strike

By Joachim MacEbong

Following the government’s refusal to revert to the status quo of N65 per liter of petrol after removing subsidies on January 1st, and after a number of meetings with the NLC that were unable to reach a compromise, the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) threatened to join the strike a few days ago by shutting oil installations. After meetings this weekend which still failed to reach mutually acceptable terms, the deadline of midnight on 14th January given by PENGASSAN came and went.

 

In a country so reliant on its crude oil sales, unions like PENGASSAN and their sister union, National Union of Petroleum and Natural Gas workers (NUPENG) become inordinately powerful because they can literally grind the country to a halt, influencing global prices at the same time. As a result, their strikes are rare, and only happen as a last resort. The last time they went on strike was on July 4, 1994 when, under the leadership of firebrand unionist Frank Ovie Kokori, NUPENG shut down oil production to protest the detention of Chief M.K.O Abiola, who was arrested on June 23, 1994 after declaring himself President twelve days earlier.

 

The effects of the strike were devastating. Up to 95% of factories were shut down, and the Abacha regime was losing $34 million a day. Blackouts were widespread, and aeroplanes were grounded. The regime would have collapsed for lack of money, but for the fact that Mobil and Chevron ramped up production by bringing in more expatriates to keep operations going. On August 19, 1994, Kokori was arrested along with other union leaders, and the strike ended the following month.

 

That little bit of history is a glimpse of what can happen in the event of a strike by PENGASSAN. It is not a decision to be arrived at lightly. The cost of the strike so far has been put at N1 trillion already, and any shutdown of oil installations will take days to get back online, losing the country even more revenue in the process, and harming already fragile finances.  The oil workers’ unions are seen, quite rightly, as a last resort in the ongoing impasse between the NLC and FG. Some see their reluctance to carry out the strike threat as a sign of cowardice or betrayal, but as history proves, it is not that simple.

 

A similar shutdown this time could have even worse consequences. Nigeria’s telecoms infrastructure runs on diesel, and if supplies are stopped for as much as a week, communication for millions could cease. Given the extent to which phones have begun to matter in our lives, such an outcome would be a nightmare scenario. Also, just like in 1994, what little electricity we generate could go with the cessation of oil production. Even generators would be unable to run.

 

With the second week of strikes about to begin, Nigerians hope that their government does the right thing, but to wish for a suspension of oil production must come with a full realization of what the consequences will be. Hopefully, it does not come to that.

 

References

 

Bacon, David (1995-11-28) Oil Rules Nigeria

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