- Nigerian trade unions are threatening with strike and unrests if the oil giant Royal Dutch/Shell goes through with its plans of massive job cuts in Nigeria. The company this week announced a major restructuring in its Nigeria operations, which include the loss of 1,500 jobs, new investments of US$ 6.5 billion and a boost of Nigeria's offshore production.
Chris Finlayson, Managing Director of Shell Nigeria, this week disclosed major restructuring plans to improve its poor performance in the country. The plan is based on a major shift from onshore to offshore oil production and will include investments of US$ 6.5 billion. These investments are foreseen to increase Shell's oil production in Nigeria from 1 million barrels to 1.5 million barrels daily over the next five years.
The company however also plans to cut costs dramatically to improve the revenue basis for its Nigerian operations, as its was "essential to reduce our operating costs to allow sufficient funds for profitable investments," according to Mr Finlayson.
These cost reduction principally were to be made by cutting an estimated 1,500 onshore jobs, according to Nigerian media reports. Shell Nigeria representatives have however not publicly confirmed these numbers, while admitting that the restructuring would include job losses.
Nigerian trade unions are now reacting in rage over the Shell announcement, warning of an "inevitable showdown" if the plans were to be implemented. The country's most powerful trade unions are uniting in protest, including the National Union of Petroleum and the Natural Gas Workers and the Natural Gas Senior Staff Association of Nigeria.
In a statement signed by the three oil-related unions, Shell Nigeria is accused of planning to replace Nigerian labour with foreign worker, believed to be less troublesome. "Much as we have nothing against the expatriates securing their future, we as Nigerians will also take steps to secure our future," a statement by the trade unions reads.
Trade unions see the restructuring plans in connection with the long battle between oil companies on one side and local communities affected by production and trade unions on the other side. After decades of pollution and marginalisation, local communities in the oil rich Niger Delta finally are achieving some concessions by oil companies, including employment.
Shell, which produces about half of all oil on Nigerian soil, has repeatedly been accused of marginalising local communities and labour by exploiting local resources, polluting the environment and investing close to nothing in the production area. Only recently, local activist and trade unions have gained Nigerian government support for their demands, which includes investments in local societies and the use of local labour by oil companies.
Labour unions hold that now, as the oil companies are obliged to take on more responsibilities for local development, they are shifting their focus towards offshore production. Here, they hold, companies like Shell will increasingly turn to foreign labour.
Nigeria's labour unions have, during the last years, repeatedly demonstrated their ability to organise powerful strikes, causing the government and employers to change their policies. In the possible upcoming protest action, unions can also count on local activists from the Niger Delta oil producing region, local media indicate. Local militants on several occasions have managed to paralyse oil production.
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