The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on President Bola Ahmed Tinubu to immediately withdraw the recent Executive Order directing the direct remittance of oil and gas revenues into the Federation Account, warning that the move could threaten about 4,000 jobs and disrupt stability in the petroleum industry.
Speaking to journalists in Lagos, PENGASSAN President, Festus Osifo, criticised the directive, describing it as a violation of key provisions of the Petroleum Industry Act (PIA) 2021, which was enacted to reform the oil and gas sector and attract investor confidence.
Osifo questioned the implications of the order on Nigeria’s credibility, particularly among foreign investors.
“What message are we sending to investors and the international community? Are we saying that an executive order can override an existing law? This is not right and should never have happened,” he said.
He explained that contrary to certain claims, the actual percentage of funds involved is minimal and that the 30 per cent Frontier Exploration Fund is not paid directly to the Nigerian National Petroleum Company (NNPC) Limited but into a designated Frontier Exploration Account.
Osifo also clarified that oil royalties are paid into government accounts and not into the personal accounts of regulatory agencies, stressing that the Executive Order does not present the full picture.
He warned that if the directive is implemented as it currently stands, oil and gas companies may struggle to meet their financial obligations, which could lead to mass job losses.
“If this order remains in place, many of our members could be declared redundant within the next few months because companies may no longer be able to sustain their operations,” he said.
Osifo recalled that PENGASSAN played a significant role in advocating for the Petroleum Industry Act, which helped restore investor confidence after nearly ten years of declining investments in the sector.
He noted that the law provided clarity and stability, enabling investors to understand the operating environment and make long-term commitments.
According to him, instability in the sector could discourage investment and negatively affect Nigeria’s economy, given the country’s heavy dependence on oil and gas revenue.
“Our major source of national income is oil and gas. The more revenue we generate, the stronger our ability to support the naira. If production drops and foreign exchange earnings decline, it will weaken the exchange rate and ultimately affect the cost of living for Nigerians,” he said.
He further highlighted the capital-intensive nature of oil and gas operations, noting that some drilling rigs cost as much as $1.5 million per day to operate.
“This is not a small-scale business. It is a multi-billion-dollar industry, and any policy that creates uncertainty could push investors away,” Osifo added.
The PENGASSAN president also expressed concern that the union was not consulted before the Executive Order was issued.
He said the association had initially been informed that the government planned to introduce an executive bill to amend the Petroleum Industry Act, but was surprised when the directive was instead issued as an Executive Order.
“We were expecting a bill that would go through the proper legislative process. Unfortunately, that did not happen, and we were not involved at any stage,” he said.
PENGASSAN has therefore urged the Federal Government to reconsider the directive to protect jobs, maintain investor confidence, and preserve stability in the oil and gas sector.
PENGASSAN Urges Tinubu to Withdraw Oil Revenue Order, Warns of 4,000 Job Losses
