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Nigeria: Job Loss Fear Grips Addax Workers
4 August 2009

Lagos — The sale of oil giant, Addax to a Chinese multinational, Sinopec, is under threat resulting from fear of job loss among the workers, who have threatened to frustrate the transaction.

This comes just as the company declared a shortfall of about 2, 000 barrels per day in his 2008 production in Nigeria.

http://allafrica.com/stories/200908040503.html

Addax Petroleum's President and Chief Executive Officer, Jean Claude Gandur, said: "Petroleum sales before royalties in the second quarter (Q2) of 2009 amounted to $735 million, a decrease of 51 per cent over petroleum sales before royalties of $1,493 million in Q2 2008. The decrease in petroleum sales before royalties was primarily driven by a 52 per cent decrease in the average crude oil sales price in Q2 2009 to $59.45 per barrel (/bbl) as compared to $123.17/bbl realized in Q2 2008, offset partially by a 2 per cent increase in sales volumes between the same periods.

"The highlight of the quarter was the offer received from Sinopec International Petroleum Exploration and Production Corporation to acquire all of the outstanding common shares of Addax Petroleum by way of a negotiated cash take-over bid for C$52.80 per common share. Addax Petroleum's Board of Directors considered a number of factors when reviewing the offer and believes that the offer is fair to shareholders and is in the best interests of Addax Petroleum."

The workers were protesting, through an industrial action, which started on Thursday, the non-inclusion of their welfare in the new arrangement, which would see Sinopec take-over Addax by way of a negotiated take-over bid for $52.80 per common share in cash.

"We have made a demand that they should retrench everybody and pay the severance packages but they said they want to retain people, without a concrete guarantee," chairman of oil workers' union Addax branch, Henry Abeatu,said in a chat with journalists after the he announced the industrial action.

The Chinese firm, according to Abeatu, is yet to takeover, while issues relating to workers' transfer have not been settled.

The chairman, Nigerian Union of Petroleum and Natural gas Workers (NUPENG) maintained that the union was suspecting a desperate plot to play smart on the workers in the process, which he described as opaque.

He said: "In the recent past, we have been having serious problems with the pension issue, which was under-funded for years. After much deliberation, the management set up a committee, which discovered that truly it was under funded. They promised to come up with options to rectify it, but up till now, nothing has been done.

"Now they are selling the company without giving due consideration to workers's welfare. We don't really know who is responsible for the due payment and other issues arising."

According to him, is it "the buyer or the seller that would be held responsible?"

He added: "Now we have made a demand that they should retrench everybody and pay the severance packages so that anybody that does not want to work with the new company may decide to opt out, but they said they want to retain people without a concrete guarantee."

Addax, it would be recalled, recently announced that it had entered into a definite Support Agreement (SA) with Chinese Sinopec International Petroleum Exploration and Production Corporation, pursuant to which Sinopec hjad agreed.

This agreement, according to the contract document, is subject to the terms of th Support Agreement to make an offer to acquire all of the outstanding common shares of Addax Petroleum by way of a negotiated takeover bid for $52.80 per common share in cash.