FG Planning To Divest JV Assets, NUPENG, PENGASSAN Reveal – Independent Newspaper Nigeria

ABUJA – Indications emerged on Tuesday, that the Federal Government is strongly considering divestment of significant stakes in Joint Venture, JV assets, hitherto managed by the Nigerian National Petroleum Company Limited, NNPCL, a development the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), as well as the Nigeria Union of Petroleum and Natural Gas Workers, (NUPENG) are strongly opposed to.

Both unions have also alleged that a plot is being mooted in government quarters to amend the Petroleum Industry Act, PIA.

According to both unions while addressing a joint press conference in Abuja, Tuesday, the Ministry of Finance appears to be culpable in the plot by trying to hijack the running of oil and gas operations instead of the NNPCL.

They warned that the move could endanger the country’s economic stability, weaken its oil industry and jeopardise the welfare of workers.

NUPENG and PENGASSAN believes policy inconsistency may send a negative signal to investors, a situation the President Bola Tinubu should avert by all means.

While the briefing lasted, PENGASSAN President, Comrade Festus Osifo alongside his NUPENG counterpart, Williams Akporeha, cautioned that the proposed sale would not only undermine national revenue but also mortgage the future of coming generations.

They insisted that government’s plan to cut its stakes in JV assets, currently between 55 and 60 percent by as much as 30 to 35 percent for quick cash was short-sighted and dangerous.

Both unions cited past divestments by international oil companies such as ENI, ExxonMobil, and Shell, which saw their Nigerian operations acquired by domestic firms.

According to them, further sales of government stakes would leave NNPC Ltd weakened and unable to meet critical obligations such as salaries, benefits, and national budget contributions.

Osifo noted: “Government is wanting to reduce its stake in these assets, principally, they want to sell some huge percentages in these assets. In some places, sell up 35 percent, in some places sell up 30 percent, so that they will have some cash to spend in other areas.

“That is the excuse that they are giving. But as an association, as PENGASSAN and NUPENG, we say no, no, no to this. You cannot mortgage our future today and tomorrow we will be starving as a country.

“If we allow this to continue, it has a way of making NNPC become bankrupt in the next few years. There are obligations that must be met, the chief of these obligations is payment of staff salaries and welfare of our members.

“Whoever mooted this idea, whether from the Ministry of Petroleum, Ministry of Finance, NNPC Ltd, or the Presidency itself, we reject it 100 percent,” the unions said.

“As you could recall a while ago, there were some divestments that took place in some of these JVs. If you could remember very well, in the ENI, Nigeria Agip Oil Company, it was bought over by Oando Energy and Natural Resources. And also, Seplat bought over the JV components of ExxonMobil.

“Today, there is a plan moved by government to reduce their stake in these JV operations. Currently, government holds between 55 percent to 60 percent of the JV assets in these companies.

“That is the stake of government today. And this stake of government today is being managed by NMPC Limited. So, they manage this JV on behalf of the Federation.

“Remember, every crude oil asset in Nigeria, every oil well in Nigeria, is not just owned by federal government, but it is owned by the federation. And NNPC limited is managing these assets on behalf of the federation. So the federation is everybody, collectively.”

Reacting to alleged plans to amend the PIA, passed in 2021 after decades of debate, PENGASSAN alleged that the Ministry of Finance was seeking to remove the Ministry of Petroleum from joint ownership of NNPC Ltd, which they described as an aberration and a backdoor attempt to hijack the company.

According to them, the amendments would strip NNPC Ltd of its core national role, undermine investor confidence, and eventually drive the company into bankruptcy.

They said, “As a responsible association, we will fight this with everything in us because we strongly believe that these amendments that they are proposing, it is not correct, it is totally wrong.