The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on President Bola Ahmed Tinubu to withdraw a recent Executive Order directing that oil and gas revenues be paid directly into the Federation Account, warning that the policy could endanger about 4,000 jobs and destabilise Nigeria’s petroleum sector.
Speaking with journalists in Lagos, the union’s president, Festus Osifo, argued that the directive conflicts with provisions of the Petroleum Industry Act (PIA), enacted in 2021 to reform and provide stability for the industry. Eyes Of Lagos reports,
Osifo questioned the implications of implementing an executive order that appears to override an existing law, noting that such actions could erode investor confidence.
According to him, the directive may create uncertainty about Nigeria’s regulatory framework and discourage both local and international investment in the sector.
He also clarified that statutory royalties are paid into government accounts rather than to regulators personally, adding that certain provisions within the order did not fully reflect how industry funds are structured.
The PENGASSAN president warned that if the order remains unchanged, oil companies may struggle to meet operational and financial obligations, potentially leading to layoffs among workers.
He stressed that thousands of employees could face redundancy in the coming months if the situation is not addressed.
Osifo recalled that the PIA was introduced after years of declining investment, with the goal of creating predictability and clear rules for investors.
He emphasised that oil and gas remain Nigeria’s primary source of revenue and foreign exchange, noting that any disruption to production could weaken the naira and worsen economic conditions for citizens.
The union leader also highlighted the capital-intensive nature of the industry, stating that some drilling operations can cost as much as $1.5 million per day, making policy consistency critical to sustaining investor participation.
Osifo added that stakeholders had expected any changes to come through a formal amendment bill rather than an executive directive.
He said the union was not consulted before the order was issued and urged the government to engage industry players to prevent negative consequences for the economy and workforce.