Hyginus Onuegbu, immediate past National Industrial Relations Officer, Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and Chairman, Trade Union Congress (TUC), Rivers State, recently disclosed that the continued fall in oil price had led to the reduction in exploration and production activities globally, thereby necessitating cost-cutting measures as the massive job cuts being embarked upon in Nigeria and other countries.
He says that Nigeria’s oil and gas companies has cut about 120,000 direct and indirect jobs to date, this is because of dwindling oil prices that affected the expected revenue of Nigerian oil companies as revealed by their third quarter reports. The report reflects that low oil prices, will likely continue up until 2019. “The sector and the economy has seen unprecedented number of job losses, as companies and organizations struggle to keep afloat in the midst of pressures from international crude oil price.
Schlumberger SLB axed more than 20,000 oilfield service workers; Halliburton cut 18,000 jobs; Weatherford International, 14,000; and Baker Hughes BHI, 13,000; with Royal Dutch Shell laying off 7,000 workers.
Job losses in the sector are worsened by the existing challenges in the industry that are yet to be addressed by the government and stakeholders. These include Nigeria’s inability to make needed reforms, especially the passage of the Petroleum Industry Bill (PIB), diversification of the economy and stoppage of crude oil theft.” highlighting the challenges of unabated pipeline vandalism, illegal crude oil diversion; insecurity and kidnapping that significantly increase in the cost of doing business.
In addition, he said that the federal government’s inability or refusal to fund the joint venture budgets and expenditure also stalls ongoing oil and gas operations which results in huge cash call arrears.