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FG, labour dispute delaying refineries privatisation – BPE

By BusinessNews Staff on June 28, 2014

The prolonged disagreement between the Federal Government and key labour unions in Nigeria’s petroleum sector is the major issue delaying the privatisation process of the country’s four refineries, the Bureau of Public Enterprises has said.

According to the bureau, the government is serious about privatising the oil firms as it would impact positively on Nigeria’s economy.

The Director-General, BPE, Mr. Benjamin Dikki, disclosed that by privatising the refineries, the government wanted to see the kind of reforms in the telecoms and power sectors happen in the oil and gas industry.

Dikki spoke on the sidelines of an event organised by Just Friends Club of Nigeria in Abuja on Friday.

He said, “When we announced that we were going to privatise the refineries, you saw the reaction from the two powerful unions in the sector, PENGASSAN and NUPENG. They created panic that they were going to shut down the Nigerian economy by blocking the supply of fuel.

“And no responsible government will want to visit that kind of thing on its citizens. That is why government halted the process and is engaging labour so that we can reach an understanding. We understand from our discussions with labour that they want to be stakeholders in the process and we have told them that is not an issue.

“So it is now left for us to sit down with labour to know how the transaction is going to be structured. Once we structure it in an acceptable manner where labour is happy and government is happy then we will commence the privatisation.”

He noted that the privatisation process would commence with the meeting of the steering committee chaired by the minister of petroleum, stressing that government had given approval for labour unions to be part of the committee in order to make their inputs.

“But we have not reached an understanding with labour yet. Once we do, then the petroleum minister will convene a meeting of the steering committee to determine the shares that will be retained by government and by labour.”

Dikki said the privatisation strategy would not be done without the appointment of a transaction adviser.

The adviser, he said, would conduct due diligence on the refineries and the petroleum sector as a whole, adding that the findings of the adviser would determine the mode of transaction to be adopted by the steering committee.

He said, “So what we would have loved to see is for labour to liaise with government and agree on the process to appoint a transaction adviser. From the beginning of the process to the appointment of a transaction adviser may take six to nine months.

“This is before the adviser goes to conduct studies on the refineries and the petroleum sector. Therefore if labour agrees with us today, we will start the process of advertising for the transaction adviser.”

[Punch]

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