COVID 19: Why Shell Plans To Lay Off Workers And Scrap Some Benefits Enjoyed By the Senior Staff

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By Elizabeth Chukwuma

  The  British petroleum, popular, Shell BP,the  British Oil giant, which subsidiary in Nigerian Shell Petroleum Development Company, SPDC,   hit the first  Commercial  Oil export, at Oloibiri, in the present day Bayelsa  state, in 1958,  appears, to  have concluded arrangement  aimed at  reducing  its staff strength  in countries where it had established operational baes.

 This is in addition to scraping some benefits enjoyed by the senior staff over the years. The Wuhan Town in Hebei Province of the Asian country of China  may have given the company the advantage to do so.  That much was also confirmed by Bernard  Loney, the   Oil and gas  Company , Managing Director, on Monday , June 8, 2020.

Loney had  said  that   the Company’s plans  to sack  10,000 of its 70,000 workforce  across the world,  mostly the office staff.  To make do its treat , it was learnt that the Anglo-Dutch oil giant was said to have  planned  to  give  some staff their  voluntary severance packages as a way of bolstering  its finances which had turned negative   as the price of a barrel of  Brent, which is Nigeria’s major crude oil continues trading  at nearly half  of what it was at the beginning  of the year .

The company, according to insider sources is seeking saving at all costs   by  significantly  scaling back  external recruitment  and reviewing  the contracts of expatriate staff. ‘’ The source disclosed that there could be  further  redundancies  at the second half of the year’’.

  Many believe that  loney had been appointed  as the Shell group Managing Director  in order  to act out the script of the shareholders’’ by maintaining a leaner and  moresilient workforce’’  to enhance their dividend which had  dropped since the outbreak of the COVID 19,  which had contracted the global economy.

Although, the Shell group  is determined to lay off staff in order to save cost, Chris Ngige, a former governor of Anambra state and minister of Labour  and Employment, was said to have met the Chief Executive officers, CEOs, of the oil companies operating in Nigeria  at the instance of President Muhammadu Buhari, urging  the companies who want to take advantage of the COVID 19   to sack  Nigerian workers, to shelve such plans.

Temipre Slyva, a former  governor of the oil- rich Bayelsa state and now minister of state , Petroleum Resources, was said to have made a similar, appeal to the multi-national oil producing and Exploration Companies. But that was how far they could  go.

Ngige: Minister Of Labour And Employment

  Osagie Okunbo, the SPDC, managing Director, in Nigeria, may not likely  bow to such pressure  not to  lay off  workers as the matter  was  beyond him.     Loney  the Shell group Managing Director,  had attributed  the company decision  to maintain a leaner and more resilient  workforce to   the  COVID 19 pandemic. The leadership of National Union of  petroleum  and Natural Gas , NUPENG, and  petroleum and  natural gas  Senior Staff   Association of Nigria, PENGASSAN, were said to have sent  a warning message to multi-national oil companies  to prepare for a major crisis in the nation’s oil sector  as they  would  embark on strike if they should go ahead with their threat of  laying off workers.

 Recall that Loney had said that the pandemic  had slashed  the demand  for  oil in the international market, thus causing   a drop in price. He  noted that  the  low demand  for oil  had come about   after   many  companies, which use oil and gas for their operation   shut their  door , particular,  the airlines, which  grounded their planes due to the disease.  

The Shell group helmsman who may have taken advantage of the pandemic  to  open up revealed  that  it takes  about $22 billion  a year  to run the Company profitably . He lamented that since the  outbreak of the disease  last February, when oil dropped a cliff, causing ‘’oil  prices to briefly turn negative’’, the company had not recovered  as it could no longer make profit to accommodate the heavy expenses of cash bonuses, pay rises for the senior staff, which they had enjoyed over the years.

Given an insider insight of the  company  operations  since the COVID 19 took hold of the global economy, he disclosed  that the British oil giant is spending  much more than  it makes  daily ,’’I am talking of  millions  of dollar’’, he had said.  He may  have  shocked  people   when  he  disclosed  that  the company  ‘’ net debt  had increased  in the recent time to $6 billion’’ which is not too good for it.

He  has given   a further  pitiable  Financial  situation  of  the company    when he volunteered another explosive information   that’’ it slumped  to $4.4 billion   net loss in the first quarter of this  2020’’.  The  Financial losses incurred by  the Company   may have informed why  Bob  Dudley, a former  Managing Director  of the Shell group, stepped  down, after 10 years on the saddle  to pave  waay  for loney to come in.  

The new Shell BP, boss  was said to have set a target  for the group :to achieve ‘’ net zero’’ carbon emissions  by 2050’’, which  Dudley could not do despite all the promises  and pressure from  various governments.

He may have gladdened the heart of the people of the Niger Delta in Nigeria, particular, when he confirmed that the company  had   launched the ‘’new purpose and ambition since February 2020 and will keep  to it. An excited Loney ‘’ is confident of the British Petroleum future to  stay  Competitive  in order to realise its ambition’’.

As a prelude to saving costs,  the  British oil giant was said to have  initiated  moves  that could facilitate    cutting down of its operation costs  by $2.5 billion  in 2021. The Anglo Dutch Company  was said to have declared that the cut in expenditure  was part of the  measures initiated ‘’ to strengthen its  balance sheets in response  to collapsing oil prices and the economic impact of the COVID 19 pandemic’’. From Russia, Mexico, Nigeria  to Glasgow, in   the United Kingdom, UK, the story is the same.

There are indications that   the French  oil giant , Total, Petrobas, Nigerian Oil Company, NAOC, a subsidiary of the Italian oil and gas giant, ENI  group, Statoil and the North American oil giants, Chevron and  Exon Mobil  may follow suit.

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