Published On: Mon, Jan 14th, 2013

Anxiety Grips Contractors, Staff over Oil Companies Relocation from Warri ….Delta State to lose N5b annually

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There is anxiety among contractors and staff working for oil companies in Delta State. This followed the relocation of Shell Petroleum Development Company (SPDC) and the planned sack of workers of the Escravos Gas to Liquid (EGTL) project of Chevron Nigeria Limited. Shell has downgraded its Western Zone Office in Warri, following a recent reorganisation. This led to the sack of thousands of direct and contract staff. The development is a fallout of a restructuring programme started in 2000 under the SoFu (Securing Our Future) programme.
Responding to enquiry, Shell’s spokesperson Precious Okolobo said: “SPDC operations in Western Niger Delta are continuing, despite the divestment of its equity in some assets in the area. “We also continue to operate key oil and gas facilities, such as Forcados Terminal.”
But our independent investigation showed that only skeletal duties are being carried out in Warri, with the same replicated in the Main Office, Oguonu (Industrial and Residential areas) and Edjeba offices.
The EGTL, which employed about 7,500 workers at the peak of construction till last year, has reportedly laid off about 4,000 (or 60 per cent of its workforce) in the last three months.
More of the non-skilled and semi-skilled workers at the $8 billion facility may lose their jobs this year.
A source said: “We have passed the construction stage of the project; where we are now is the inauguration stage. So you do not expect us to keep all the workers whose services are no longer needed.
“Right now, workers here have reduced drastically, with just about 3,000 left of the over 8,000 we had during the peak of construction.Some of the workers and contractors may be retained but I do not see up to 20 percent of those who started here making it afterwards.”
It was also gathered that the businesses of those engaged in contracting services have dipped.
Lucky Izoukumor, CEO of Lurine Nigeria Limited, an indigenous oil service company in Warri, told our reporter that he and other colleagues were worried about Shell’s relocation.
He said: “In the past they when Shell sneezes, Warri catches cold. But what we have right now is more than Shell sneezing. It is Shell dying in Warri and you can imagine what the situation will be for businesses that rely on contracts from the company.”
Further investigations showed that the Delta State Government may be the greatest loser in the end.
Financial experts predict that the relocation could cost the state as much as N5 billion revenue from the Pay As You Earn tax alone.
A source said: “Apart from the multiplier effect of these workers’ salaries that will be spent elsewhere, the state stands to lose as much as N5bilion this year because PAYE and other taxes of Shell and its staff will now be paid to the state where they have relocated to.
“Plus you don’t expect persons without jobs to pay tax. So, the loss of Shell may leave a gap that filled for a long time. Don’t be surprised if there is a growing frustration and restiveness in the host communities.”
The relocation is a source of anger among indigenes of the host communities. Some of the aggrieved hosts lamented the manner in which Shell sold its oil blocks without their knowledge and involvement.
Contractors such as Izoukumor are unhappy that the government did not do enough to keep Shell in the state.
“I wonder why the government allowed Shell to move its staff out of Warri while still keeping their assets and operation here.
“What this means is that the state is the loser because Shell will still bring workers from Port Harcourt or any other place to work on these onshore and offshore facilities.
“They will earn their salaries and spend them outside without any benefit accruing to the state.”
Danial Amraketa of Delta League of True Democrat advised Governor Emmanuel Uduaghan to resist Shell making money from the state without any benefit.
Uduaghan’s Communication Manager Paul Odili did not respond to our reporter’s inquiry.
The Nation gathered that the Otumara Gas Project being undertaken by Shell and Joint Venture Partners in Warri South West Local Government may absorb some workers dropped from the EGTL project.
Source; Nation

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