The Nigerian National Petroleum Company Limited (NNPCL) has warned of mounting energy security risks after the three-day nationwide strike by the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) crippled crude and gas production, triggering significant financial and operational setbacks.
Strike Hits Crude, Gas and Power Supply
According to a letter sent by NNPCL’s Group Chief Executive Officer, Bashir Bayo Ojulari, to regulators and security agencies, the strike action resulted in the deferment of 283,000 barrels of crude oil per day (bpd) and 1.7 billion standard cubic feet per day (scfd) of gas. This translates into a 16 per cent drop in national oil production, a 30 per cent fall in marketed gas, and a 20 per cent decline in power generation capacity within just 24 hours of the action.
Ojulari stressed that the disruption, which also derailed scheduled maintenance activities, represented a “material threat to national energy security” if prolonged.
Dangote Refinery Dispute Sparks National Impact
The strike stemmed from a bitter labour dispute between PENGASSAN and the Dangote Petroleum Refinery. The union accused the refinery of mass transfers, unfair dismissals, and the replacement of Nigerian staff with foreign workers. Dangote’s management, however, insisted that its workforce restructuring was purely operational.
The deadlock escalated when PENGASSAN halted gas and crude supplies to the 650,000 barrels-per-day refinery, forcing shutdowns across terminals, gas plants, and power facilities. The Federal Government stepped in, warning of the strike’s “adverse effects on the economy and energy security,” and secured a temporary suspension of the action.
Mounting Financial Losses
NNPCL’s assessment revealed not only lost production but also disruptions in crude lifting schedules and export operations. At the Brass Terminal, for instance, crude loading was delayed due to stalled documentation, already incurring demurrage charges from international buyers.
The company disclosed that it had delayed restoring 100,000 bpd of crude and 1.34 bscf of monetised gas, originally scheduled for this week. It also pushed back critical projects, including USAN turnaround maintenance, AKPO GT-3 pigging, and compressor overhauls, compounding the risk of prolonged output deferments.
Ojulari cautioned that “missed crude lifting and disrupted gas sales are placing the company’s cash flow under immediate and compounding pressure.”
Union Holds Firm, But Truce Remains Fragile
While PENGASSAN suspended the strike out of respect for federal mediation, its president, Festus Osifo, maintained that the action could resume without notice if Dangote fails to uphold commitments.
“This fight is not about check-off dues,” Osifo said. “It is about freedom of association, fair welfare, and workers’ rights. Our members joined PENGASSAN because they want their lives to be better, and we will stand by that.”
He dismissed claims that the strike sought to undermine Dangote’s $20bn refinery investment, noting that global oil majors such as Shell, Chevron, and ExxonMobil thrived despite having thousands of unionised workers.
Broader Implications for Nigeria’s Energy Security
Industry experts warn that the strike highlights Nigeria’s vulnerability to labour unrest within its critical oil and gas sector, which contributes over 90 per cent of foreign exchange earnings and funds the Federation Account Allocation Committee (FAAC).
With deferred oil barrels, lost gas molecules, and rising demurrage costs, analysts argue that the crisis underscores the urgent need for sustainable labour relations frameworks, especially as Nigeria seeks to maximise revenues amid fluctuating global oil prices.
For now, the suspension has calmed tensions. Yet, the underlying mistrust between the union and the refinery operator leaves Nigeria’s energy future on edge.