Oil Industry at Risk of Major Damage
Oil truck drivers in Nigeria took to the capital’s streets in protest in early April because of wage disputes and lousy roads, causing widespread strikes and attacks. Reuters reported that the strikes could lead to major disruptions in the supply chain of the country’s oil and gas sector. As an industry already on its knees for nearly a year because of extreme militant conflict, indefinite delays in deliveries could cause irreparable damage.
Chairperson of the Nigeria Union of Petroleum and Natural Gas, Cogent Ojobo stated that the decision to strike was unanimous and every tanker truck driver in the country is taking a stand. He also stated that the union is in the process of discussing options with the government. It is predicted that should talks fail, membership of the union will increase along with prices of petroleum products. According to a spokesperson from the Nigerian government, the Labour Ministry was well represented at the discussions. Although the oil ministry coordinated the meetings, nobody from the ministry was available for comment.
Besides the strikes and attacks, the energy revenues of Lagos, Nigeria’s largest city, has been affected by pipeline closures and theft of oil over the past year. The Nigerian unit of Shell shut down one of two lines carrying crude oil for export purposes with the aim of removing areas vulnerable to theft and leaks. In early March a subsidiary stated that it was shut down to maintain a field that had the capacity to produce over 220,000 barrels of oil per day. Despite limited data being made available, it has been estimated that these actions have resulted in a daily revenue loss of almost US$11 million.
The Time for Reform is Now
With numbers like this, national strikes and fluctuating prices, is that not proof enough that the senate should bring their debates to a close and formalize the Nigerian oil reform bill? It has taken over a decade.