The Nigerian National Petroleum Company Limited (NNPC Ltd) on Tuesday said that the ongoing dispute between Dangote Refinery and the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has resulted in significant disruptions to Nigeria’s energy sector.
In a letter dated 29 September, addressed to the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the NNPC said the industrial action has resulted in significant production deferments.
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PREMIUM TIMES reported how the dispute between the company and labour unions escalated despite efforts by government to douse tension.
The national oil company’s letter, titled ‘Impact Assessment of ongoing industrial action,’ was signed by the NNPC Group Chief Executive Officer, Bashir Ojulari and also sent to the National Security Adviser (NSA) and the Director General, Department of State Services.
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“We are writing to highlight the impact of the ongoing dispute between Dangote Refinery and PENGASSAN, and the impact of the union’s directive for members to withdraw services effective 28 September 2025.
“In line with NNPC Limited’s mandate to manage Joint Venture assets; act as the concessionaire in Production Sharing Contracts (PSC) on behalf of the federation; and serve as the supplier of last resort to safeguard national energy security, it is important to provide an update on the implications already observed and the risks should the situation persist,” the letter reads.
Impact
The NNPC said as of 29 September (within the first 24 hours of the strike), production deferments stood at approximately 283 kbopd of oil, 1.7bscfd of gas, and over 1,200 MW of power generation.
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This, it said, equates to around 16 per cent of national oil output, 30 per cent of marketed gas, and 20 per cent of electricity generation.
“Should the situation continue, the impacts are expected to intensify, posing a material threat to national energy security,” the NNPC said.
The state-owned oil company explained that most office locations were made inaccessible by the staff union, with access restricted to only staff in the medical, security, and fire services departments.
“NNPC and its partner companies have activated their Business Continuity Plans (BCP) to ensure continuation of field operations where possible and office staff have been advised to work remotely. Non-unionised staff were deployed to maintain field operations in most locations, but several sites recorded disruptions.”
The NNPC said the withdrawal of services across the fields will halt or reduce outputs across multiple fields.
“About 100kbopd and 1.341 bscfd (monetised gas) deferments across JV and PSC planned to be restored within this week are delayed. Bonga FPSO (PSC) is currently shut down with 120kpd being deferred,” it added.
The NNPC added that the Oben gas plant, Afam 6 power plant and Okpai power plant were shut down due to union actions resulting in deferment of a total of about 400mmscfd of domestic gas, 18kbopd of oil and impacting over 1,200MW of power from Afam, Okpai, Egbin, Azura and Transcorp Power.
In addition to the current shutdown at the Oben gas plant, it said further disruptions have been recorded across the midstream sector.
It noted that Shell Nigeria Gas (SNG) is currently deferring 50 mmscfd of domestic gas, which is affecting customers in Agbara Ota.
It said there have been repeated attempts to disrupt the NNPC Gas Infrastructure Company (NGIC) Escravos-Lagos Pipeline System (ELPS) and OB3 networks, including efforts to shut down the Warri Gas Treatment Plant, OML 34, and Oghara pigging station.
“If ELPS were to become non-operational, over 1,300 mmscfd of domestic gas would be at risk, potentially impacting the industrial hub in Lagos.
“Earlier plans by the Union to cut feed gas production to NLNG were averted following constructive engagements. Operations are currently stable, however, the restart of Train 5 and Train 6 after Turn Around Maintenance (TAM) were delayed, affecting recovery of over 1 bscfd of gas,” it said.
According to the NNPC, limited numbers of non-unionised staff are currently facilitating exports, but constraints are evident.
It said ongoing and programmed lifting operations at the terminals are likely to be affected leading to potential demurrage claims.
It said cargo loading designated for Dangote Refinery is on hold pending clearance, noting that discussions are ongoing to allow the vessel clearance and haulage creation.
At Ugo-Ocha Terminal, the NNPC said clearance was withholding for shuttle vessels to berth and carry out required STS operations.
This, it said, has halted injections to the terminal, potentially deferring 45kpd starting from the evening 29 September.
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“Loadings are similarly delayed pending availability of NUPRC non-unionised staff to facilitate the export. The loading process for an NNPC Cargo, which was nearing completion, was delayed due to the inability to finalise documentation because of union action, consequently leading to demurrage costs.
“Five scheduled critical activities for this period will be impacted. Knock-on effects will cause further deferments in subsequent periods. These include USAN TAM, AKPO GT-3 pigging, H2 Well Tests, Annual compressor maintenance, and SEPNU EAP IGE,” it said.
The NNPC said critical-path project activities will slip, leading to delays in production growth timelines.
It added that significant revenue losses are projected at current deferment levels, driven by missed liftings and gas sales.
The NNPC said cashflow pressures are immediate and compounding.
NNPC said it continued engagement with operating partners and key stakeholders to enhance security and emergency protocols, activation of BCP with non-union staff taking over operations, where practicable.
“It is our considered view that the current industrial action has impacts that extend beyond the Dangote Refinery. The disruptions pose systemic risks to energy supply, personnel and asset security and the wider economy.
“A sustainable solution is required to prevent such an extensive interruption of the overall energy security infrastructure and to safeguard national energy security and stability,” the NNPC said.
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