Nigeria: Learning to Swim Without Getting Wet

10 December 2018

THE National Union of Petroleum and Natural Gas Workers, NUPENG, one of the most militant unions in African labour history, last week marked its fortieth anniversary. Back in 1994 when the military held Nigeria in vile grip, NUPENG sent out a call for the unions to rescue the country. The regime of General Sani Abacha was particularly brutish, nasty and bloody. It was a dictatorship that had no rules, respected none and included the bombing of buses especially those conveying soldiers, as part of governance. Not surprisingly, other unions including the central labour organisation, the Nigeria Labour Congress, NLC, chickened out.

NUPENG, backed by the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, took on the military in weeks of strikes and protests. Even when the strikes were crushed and its leaders herded into years of solitary confinement, NUPENG held its head high. As part of this anniversary, NUPENG invited me as a discussant at its roundtable on "Local Content in the Nigeria Oil and Gas Industry: Wherein lies the interest of Nigerian Workers?"

To me, the Local Content in the Nigeria Oil and Gas Industry as explained in the Nigerian Oil and Gas Industry Content Development, NOGICD, Act No 2 of 2010 is not about restructuring the oil industry which has always favoured the foreign ownership, exploitation and control of the industry to the detriment of the Nigerian people and state. It is not about the Nigerian people owning their oil and gas resources or having a greater say in it. It is not about the cry against individuals owning or being awarded oil blocs while most of the states in the country are so cash-strapped, that they cannot pay salaries. It isn't about oil workers having a greater say in an industry they have helped to build for sixty one years now. It is not about ending the enslavement of workers in a lucrative industry that has converted almost all permanent work into casual contract with no guaranteed job security. It is not about the Nigerianization of the Oil and Gas industry, 45 years after the Indigenization law.

Rather, Local Content in the Nigeria Oil and Gas Industry is like asking that a little sugar be added to a tasteless jug of tea for the consumption a handful of local players in the industry. The main objective in Local Content provides that: "Nigerian independent operators shall be given first consideration in the award of oil blocs, oil field licences, oil lifting licences and in all projects for which contract is to be awarded in the Nigerian oil and gas industry subject to the fulfilment of such conditions as may be specified by the Minister."

The Local Content law is like telling Nigerians, 'You can sniff indigenization, but you are forbidden from eating its fruit.' Seeking to add local content in an industry in the hands of foreigners is like telling Nigerians 'You can swim in the river, but don't get wet.' It is instructive that the specificity of local content, and how far it can dilute the dominant foreign content in the Oil and Gas industry in the country, is at the discretion of whoever finds himself as the Minister of Petroleum. In other words, the power and the net worth of whoever is the Minister in charge of that Ministry is greatly enhanced by the Act. That in plain language means that if the overall foreign Lords in our Oil and Gas industry can pocket the Petroleum Minister at any given time, the local content component can be jeopardized.

There is a sense it can be argued that the Local Content Act is a long term, if circuitous journey in the desert to reach a Nigerianization promised land. These are in the realms of tactics and strategies; to eventually indigenize the Nigerian Oil and Gas industry without annoying the foreign masters or provoking a Western backlash. Government estimates that lack of local content had from independence in 1960 to 2010 resulted in capital flight of $380billion Dollars and job lost opportunities of about two million. It says that infusing local content, aims at creating 300,000 direct jobs and retaining over $14 Billion in the country out of the $20 Billion spent annually.

The Act gives priority for the employment of Nigerians but says where a skilled Nigerian is not available, a foreigner can do such job over four years. In my analysis, this provides a latitude which foreigners can exploit. Also, under the Act, local companies can have "alliance partner" in foreign companies bidding for jobs. In a large sense, this is what subsists in the industry. Additionally, each project has 5 percent management provision for foreigners. This means that the main management positions can be controlled by foreigners.

My argument includes the fact that the Local Content in the Nigeria Oil and Gas Industry and its enabling Act does not provide for labour representation in its structures and governing bodies nor protect Nigerian workers from the casualization of permanent jobs, a negative practice prevalent in the industry or encourage local refining of petroleum products which can guarantee jobs and eliminate the fraud called oil subsidy. It does not change in any fundamental manner, the foreign-ownership structure of the Nigerian Oil and Gas Industry nor address the devastation of the environment due to oil and gas exploitation. The law does not reduce the cost of producing a barrel of crude oil which has hovered between $20 and $23; a far cry from Saudi Arabia which produces a barrel at $8.98 or war torn Iraq which produces at $10.70. Of course, the law is not concerned with the wastage of Nigerian oil resources or its implications for future generations.

Between Samsung workers and Ladol

My basic argument is that our six-decade practice of holding the oil and gas cow while foreigners milk it, should change. I told the oil workers that if the Nigerian people are deprived of the benefits of being oil producers, their own interests as employees, cannot be guaranteed. In my analysis, there is a corelation between the interests of the Nigerian people and those of workers in the industry. There is, therefore, the need to harmonize this relationship as we match towards the ultimate goal of controlling our oil and gas resources, utilizing them in a sustainable and beneficial way for this and future generations.

Human Rights lawyer and Senior Advocate of Nigeria, Femi Falana, advised the oil workers to adopt the implementation of the Nigerian Oil and Gas Industry Content Development, NOGICD, Act as a minimum programme on which to hold the Oil and Gas companies and government accountable. In my assessment, NUPENG still has a lot of fighting spirit. This is good for its members and Nigerians.

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