Members of the Petroleum and Natural Gas Senior Staff Association of Nigeria threatened to shut down oil production in Nigeria for 30 days.
According to The Punch, protesting PENGASSAN members made the threat on Thursday, saying if Federal Government fails to curb the lingering massive oil theft in the Niger Delta region.
Members of the union staged protests in various parts of Nigeria including Abuja, Warri in Delta State, Kaduna and Port Harcourt in Rivers State.
If the workers implement their threat, Nigeria might lose about N1.37trn from the non-production and sale of crude oil, a major foreign exchange revenue earner for the country.
Speaking at the sensitisation rally that was held at the Delta State Governor’s Office Annexe in Warri, the PENGASSAN Zonal Chairman, Prince Audu Osihiokhamele, noted with concern that “the big men doing the business of crude oil theft are in government.”
He added, “They say they load vessels, but we don’t see any. Is it a needle?”
He then declared that failure by the authorities to find lasting solutions to the menace would push PENGASSAN into taking more drastic actions.
“We will shut down the country for 30 days until we all come to the round table to unravel the mysteries surrounding the thefts,” Osihiokhamele stated.
He added, “PENGASSAN will resort to shutting down production for 30 days by withdrawing members, both onshore and offshore, wherever they are producing crude, should the government fail to hearken to this warning.”
An analysis by the publication showed that by shutting down oil production for 30 days, the country could lose about 30.03 million barrels of crude, valued at an estimated N1.37trn.
Figures from the Nigerian Upstream Petroleum Regulatory Commission showed that in January, February, March and April 2022, the country’s crude oil production (without condensates) was 1.39 million barrels per day, 1.26mbpd, 1.24mbpd and 1.22mbpd respectively.
In May, June, July and August 2022, the figures were 1.02mbpd, 1.16mbpd, 1.08mbpd and 0.97mbpd respectively. The average oil production for the eight months is therefore 1.168mbpd.
This means that should the workers shut down production for 30 days, the country would not produce about 30.03 million barrels of crude.
For the prices of oil during same eight-month period, data from countryeconomy.com, an international analytical firm, showed that the average monthly costs of Brent, the global benchmark for crude, was $86.51/barrel in January, $97.13/barrel in February and $117.25/barrel in March 2022.
In April, May, June, July and August 2022, the average costs of a barrel of crude were $104.58, $113.34, $122.71, $111.93 and $100.45 respectively. This implies that the average cost of the commodity in the eight-month period is $106.74/barrel.
By not producing an estimated 30.03 million barrels in 30 days, the country would lose about $3.21bn or N1.37tn (as at Thursday’s official exchange rate of N427.43/$)