The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has rejected the Executive Order signed by President Bola Ahmed Tinubu directing that all oil and gas revenues be remitted directly into the Federation Account.
The union warned that the directive could threaten thousands of jobs and destabilise Nigeria’s oil and gas sector.
Speaking to journalists in Lagos on Thursday, PENGASSAN President Festus Osifo described the order as a direct affront to the Petroleum Industry Act (PIA) 2021, legislation enacted to reform and stabilise the country’s hydrocarbon industry.
Osifo cautioned that implementing the directive without broad stakeholder consultation could undermine investor confidence and jeopardise the sector’s growth. He argued that an Executive Order cannot override the provisions of an existing law such as the PIA, warning that the move sends a troubling signal to domestic and international investors about regulatory certainty and respect for the rule of law.
He described the directive as an “aberration,” insisting it undermines established legal frameworks governing the industry.
The Executive Order, signed on February 13 and later announced by the Presidency, mandates the direct payment of royalty oil, tax oil, profit oil, profit gas and other upstream revenues into the Federation Account. This effectively ends the provision allowing the Nigerian National Petroleum Company Limited (NNPCL) to retain 30 per cent of profit oil and profit gas as management and frontier exploration fees under the PIA.
According to Osifo, if implemented as written, the directive could place about 4,000 PENGASSAN members’ jobs at risk, as reduced revenue inflows may affect NNPCL’s capacity to meet salary obligations and operational costs.
The union further stated that it was not consulted before the order was issued. Osifo explained that PENGASSAN had previously been informed of plans for an executive bill to amend aspects of the PIA — a legislative process in which it expected to participate — but was instead confronted with an executive instrument that bypassed parliamentary scrutiny.
Beyond employment concerns, PENGASSAN warned of wider economic implications. It noted that discouraging investment in the capital-intensive oil and gas industry could result in lower production levels, diminished foreign exchange earnings, and adverse impacts on Nigeria’s exchange rate and citizens’ purchasing power.
The union’s position signals mounting pressure on the Federal Government to reconsider or review the Executive Order, as labour groups begin consultations with other industry stakeholders on possible next steps.
