On Saturday, September 27, 2025, the industrial dispute between the Dangote Petroleum Refinery, a $20 billion monumental project in Nigeria’s energy sector, and the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) reached a critical turning point. The union issued a bold directive ordering its members to immediately halt the supply of crude oil and gas to the refinery, an action that threatens to cripple operations at one of Africa’s largest industrial complexes. This escalation marks a significant intensification of a conflict that has been simmering between PENGASSAN and the refinery’s management, raising questions about labor relations, economic implications, and the future of Nigeria’s oil and gas industry.
Background of the Dispute
The Dangote Petroleum Refinery, located in the Lekki Free Zone near Lagos, Nigeria, is a flagship project of the Dangote Group, led by Africa’s richest man, Aliko Dangote. The refinery, with a capacity to process 650,000 barrels of crude oil per day, was designed to reduce Nigeria’s dependence on imported refined petroleum products and position the country as a net exporter of fuel. Since its commissioning, the refinery has been hailed as a transformative development for Nigeria’s economy, promising job creation, energy self-sufficiency, and a boost to the nation’s industrial capacity.
However, beneath the surface of this ambitious venture, tensions have been brewing between the refinery’s management and its workforce, particularly members of PENGASSAN, a powerful union representing senior staff in Nigeria’s oil and gas sector. PENGASSAN has long been a vocal advocate for workers’ rights, and its members include professionals and technical staff critical to the upstream, midstream, and downstream segments of the petroleum industry.
The current dispute centers on allegations of anti-labor practices by the refinery’s management, including claims of unlawful terminations and retaliation against workers exercising their constitutional right to unionize. These accusations have fueled a standoff that has now escalated into a direct challenge to the refinery’s operations.
The Union’s Directive: A Bold Move
On September 26, 2025, PENGASSAN’s General Secretary, Lumumba Okugbawa, issued a strongly worded letter to the union’s branch chairmen at major oil and gas companies across Nigeria. The letter outlined a series of immediate actions to be taken in response to what the union described as “gross violations” of workers’ rights by the Dangote Refinery management. The directive was clear and uncompromising, instructing members to:
Cease Gas Supply via NGIC: The union ordered an immediate halt to all gas deliveries to the refinery through the Nigerian Gas Infrastructure Company (NGIC), a key supplier of natural gas critical for the refinery’s operations.
Shut Crude Oil Supply Valves: PENGASSAN directed its members to close all crude oil supply valves feeding the refinery, effectively choking off the facility’s primary raw material.
Halt Vessel Loading Operations: The union mandated a complete suspension of vessel loading operations for crude oil and other materials destined for the refinery, further isolating the facility from its supply chain.
The letter concluded with a powerful statement of solidarity: “Injury to one! Injury to all!” This rallying cry underscored the union’s determination to stand united in defense of its members and signaled a willingness to take drastic measures to pressure the refinery’s management into addressing its grievances.
The directive took effect immediately on September 27, sending shockwaves through the oil and gas industry. The targeted companies—including industry giants like TotalEnergies, Chevron, Seplat, Shell Nigeria Gas, Oando, Renaissance, and NGIC—are critical players in Nigeria’s upstream and midstream sectors. Their compliance with PENGASSAN’s orders could severely disrupt the refinery’s ability to operate, potentially leading to significant financial losses and broader economic repercussions.
PENGASSAN’s Grievances
At the heart of the dispute are PENGASSAN’s allegations of anti-labor practices by the Dangote Refinery management. The union claims that the refinery has engaged in a systematic campaign to suppress workers’ rights, particularly targeting those who have sought to exercise their constitutional right to join a trade union. According to PENGASSAN, the refinery’s management has responded to unionization efforts with retaliatory measures, including the unlawful termination of workers.
In its letter, PENGASSAN accused the refinery of spreading misinformation to justify its actions and failing to engage in meaningful dialogue to resolve the conflict. The union described the terminations as “illegitimate” and argued that they were a direct attack on the fundamental rights of workers to organize and advocate for better working conditions. For PENGASSAN, the issue is not merely about the treatment of its members but about upholding the principles of fair labor practices and ensuring that workers are not penalized for asserting their rights.
The union’s decision to escalate the dispute by cutting off crude oil and gas supplies reflects the depth of its frustration and the perceived severity of the refinery’s actions. By targeting the refinery’s supply chain, PENGASSAN aims to exert maximum pressure on the management to reconsider its stance and enter into negotiations to address the union’s demands.
The Refinery’s Response
The management of the Dangote Petroleum Refinery has strongly refuted PENGASSAN’s allegations, denying claims of a mass layoff or anti-labor practices. In a statement issued on Friday, September 26, 2025, the refinery clarified that only a small number of workers were affected by what it described as a “reorganization” exercise. According to the management, this restructuring was necessary to address recurring acts of sabotage that posed significant risks to the safety of workers and the integrity of the refinery’s operations.
The refinery emphasized that it continues to employ over 3,000 Nigerians, a figure it cited to counter accusations of widespread job losses. The management argued that the reorganization was a proactive measure to safeguard the facility and ensure its long-term sustainability. While acknowledging the importance of workers’ rights, the refinery maintained that its actions were justified and not targeted at unionized workers specifically.
The statement also highlighted the refinery’s broader contributions to Nigeria’s economy, including job creation and the potential to transform the country’s energy landscape. The management expressed disappointment at PENGASSAN’s decision to escalate the dispute, calling for dialogue to resolve the issue amicably.
The Broader Context: Labor Relations in Nigeria’s Oil Industry
The standoff between PENGASSAN and the Dangote Refinery is not an isolated incident but part of a broader history of labor disputes in Nigeria’s oil and gas sector. The industry has long been a battleground for conflicts between workers and employers, with unions like PENGASSAN and the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) playing a central role in advocating for better wages, working conditions, and job security.
Nigeria’s labor laws, including the Trade Unions Act, guarantee workers the right to form and join trade unions without fear of retaliation. However, enforcement of these laws has often been inconsistent, and disputes between unions and employers frequently escalate into strikes, shutdowns, or other forms of industrial action. The oil and gas sector, given its critical importance to Nigeria’s economy, is particularly prone to such conflicts, as disruptions in this industry can have far-reaching consequences.
The Dangote Refinery, as a private enterprise, operates in a different context from state-owned entities472 like the Nigerian National Petroleum Corporation (NNPC). While the NNPC has a long history of dealing with unionized workers, private companies like Dangote often face accusations of prioritizing profit over employee welfare. The current dispute highlights the challenges of balancing corporate objectives with labor rights in a high-stakes industry.
Economic and Operational Implications
The immediate impact of PENGASSAN’s directive is likely to be felt in the refinery’s operations. Crude oil and natural gas are the lifeblood of the facility, and any disruption in their supply could bring production to a standstill. The refinery’s ability to process crude oil into refined products such as petrol, diesel, and aviation fuel depends on a steady flow of raw materials, and a prolonged cutoff could result in significant financial losses.
Moreover, the refinery’s role as a key player in Nigeria’s quest for energy self-sufficiency means that disruptions could have ripple effects across the economy. Fuel shortages, price hikes, and delays in exports could undermine the refinery’s ability to deliver on its promise of reducing Nigeria’s reliance on imported petroleum products. For consumers, this could translate into higher fuel prices and supply chain disruptions, exacerbating economic challenges in a country already grappling with inflation and currency depreciation.
The involvement of major oil companies like TotalEnergies, Chevron, and Shell Nigeria Gas in the dispute adds another layer of complexity. These companies are critical suppliers to the refinery, and their compliance with PENGASSAN’s directive could strain their relationships with the Dangote Group. At the same time, these companies must navigate their own labor relations and operational priorities, making their response to the union’s orders a delicate balancing act.
The Path Forward: Dialogue or Confrontation?
The escalation of the dispute raises critical questions about the path forward for both PENGASSAN and the Dangote Refinery. For the union, the decision to cut off supplies is a high-stakes gamble that could either force the refinery to negotiate or deepen the divide between the two parties. PENGASSAN’s ability to maintain solidarity among its members and sustain the supply cutoff will be crucial to the success of its strategy.
For the refinery’s management, the challenge lies in addressing the union’s grievances without compromising its operational goals. The accusation of sabotage is a serious one, and the refinery will need to provide evidence to substantiate its claims if it hopes to regain the trust of its workforce. At the same time, the management must contend with the immediate threat to its operations and the broader implications for its reputation and financial performance.
Dialogue appears to be the most viable path to resolving the conflict. Both sides have expressed a willingness to engage in discussions, but the terms and conditions of such talks remain unclear. Mediation by third parties, such as the Nigerian government or independent labor arbitrators, could help bridge the gap between the union and the refinery. The government, in particular, has a vested interest in ensuring the stability of the refinery, given its strategic importance to the nation’s economy.
Broader Implications for Nigeria’s Energy Sector
The dispute at the Dangote Refinery has broader implications for Nigeria’s energy sector and its aspirations to become a regional energy hub. The refinery was envisioned as a game-changer, capable of transforming Nigeria from a net importer of refined petroleum products to a self-sufficient producer and exporter. However, persistent labor disputes and operational challenges could undermine this vision, raising doubts about the feasibility of large-scale industrial projects in Nigeria.
The conflict also underscores the importance of fostering a collaborative relationship between employers and workers in the oil and gas industry. As Nigeria seeks to attract foreign investment and expand its energy infrastructure, ensuring a stable and harmonious labor environment will be critical. The Dangote Refinery, as a flagship project, serves as a litmus test for the country’s ability to balance economic ambition with social responsibility.
Conclusion
The industrial dispute between the Dangote Petroleum Refinery and PENGASSAN is a complex and multifaceted issue that touches on labor rights, corporate governance, and economic strategy. The union’s decision to cut off crude oil and gas supplies represents a bold and risky move, one that could have far-reaching consequences for the refinery, its workers, and Nigeria’s energy sector as a whole. While the refinery’s management has defended its actions as necessary for operational integrity, the union’s allegations of anti-labor practices and unlawful terminations have struck a chord with workers and observers alike.
As the standoff continues, the need for dialogue and compromise becomes increasingly urgent. Both sides have much to lose from a prolonged conflict, and the broader implications for Nigeria’s economy cannot be ignored. Whether through mediation, negotiation, or legal recourse, resolving this dispute will require a commitment to fairness, transparency, and mutual respect. For now, the eyes of the nation—and the global energy industry—are on the Dangote Refinery, watching to see how this high-stakes drama unfolds.
