Production targets of the Nigeria Liquefied Natural Gas (NLNG) may no longer be feasible as a two-weeks-old labour dispute at the company has slowed construction of Train 6 of the Bonny LNG plant. THISDAY Checks yesterday revealed that workers building the $1.25 bn Train 6 expansion, have been staging sit-ins at the site on Bonny Island in Rivers State since Aug 18.
“There has been a disagreement between our contractor, TSKJ and its workers over pay dispute and this has slowed down work on the train six project,” a source disclosed yesterday.
The workers and management of the TSKJ consortium had been locked in the dispute for two weeks now, with the workers adopting a sit-in protest at the weekend, the source added.
The workers demand for increased remuneration, which has resulted in the logjam in the company may however not be unconnected with the increased insecurity in the Niger Delta region. Some three weeks ago, four workers of NLNG contractors were kidnapped by militants. Sources close to the Nigerian LNG Limited however,told THISDAY yesterday that the issue would not affect the scheduled completion date for the plant’s train 6.”We believe the matter should be resolved soon. However, we don’t see it as having any material impact on the progress of work on train 6,” the source said.
NLNG exports 17 million tonnes a year to Europe and America. Its five producing trains are now worth about $24bn, according to Deutsche Bank. The sixth train will add about 5 million tonnes of exports when it begins operation at the end of next year.
The protesting workers are employed by a subcontractor to TSKJ, the main contractor responsible for the work.
TSKJ is registered in Portugal and comprises Halliburton unit KBR, Technip, Eni affiliate Snaprogetti Netherlands, and JGC Corporation of Japan.
The two largest Nigerian oil unions NUPENG and PENGASEN have set a 13 September start date for a three-day nationwide warning strike over insecurity in the Niger Delta, to protest government inaction over a spate of kidnappings and killings of oil workers.
Nigeria’s main oil producing region, the Niger Delta, remains a high security risk zone for the oil companies operating there and they count their losses to unrest in hundreds of millions of dollars.
Clashes erupt frequently between the security forces working for the oil companies and local residents, victims of grinding poverty in this southern region of Africa’s most populous country of 130 million inhabitants.
In one incident, the oil terminal of American oil giant ChevronTeaxco on the Escravos river was invaded by hundreds of irate protesters
Three NLNG subcontractors, all from South Korea, were abducted near the complex last month, and held in captivity for 10 days.
The company did not say what led to their release, but the government has since criticised companies for paying ransoms.
NLNG is a joint venture involving state-run Nigerian National Petroleum Corporation with 49%, Shell with 25.6%, Total with 15% and Eni with 10.4%.