NIGERIAN STATE OIL EXPLORATION AND COMMUNITIES INTEREST, ISSUES AND PERSPECTIVES

NIGERIAN STATE OIL EXPLORATION AND COMMUNITIES INTEREST, ISSUES AND PERSPECTIVES

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CHAPTER ONE

OIL EXPLOITATION AND CHALLENGES OF DEVELOPMENT IN THE NIGER DELTA

1.1 INTRODUCTION

Oil exploration activities commenced in the Deltaic region of Nigeria in the early 1900s by a Germany entity referred to as the “Nigeria Bitumen Corporation” which started her exploratory activities in the Araromi area of the then Western Nigeria but their activities were truncated by the out break of the World War I in 1914 (NNPC: 2005; 1-2). Oil exploration activities thereafter started with the Shell D’Arcy (the forerunner of Shell Petroleum Development Company, SPDC of Nigeria) in 1937 when Shell was awarded the sole concessionary rights covering the whole territory of Nigeria. Their activities were also interrupted by the World War II but they resumed in 1947 and with concerted efforts, after several years and investment of over N30 million, the first commercial oil well was discovered in 1956 at Oloibiri in present Ogbia Local Government of Bayelsa State in the Niger Delta region. This discovery opened up the oil industry in 1961 in Nigeria, bringing more oil firms like the Agip, Mobil, Safrap (now Elf), Texaco and Cheveron to petroleum prospecting both in on shore/offshore areas of Nigeria (Nigeria National Petroleum Corporation, NNPC; 2005:1-2).

 From then, “oil production rose from initial figures of 5,100 barrels per day (bpd) from the first well in Oloibiri to today’s production of over 25 million bpd, even though our OPEC quota specification is based on 2.15 million bpd” (Okaba, 2008:8). Between 1956 and 1958, more oil fields were discovered at Afam, Bonu, Ebubu and Later Ugheli and Kokori and the production capacity steadily rised. By this period, oil has become so prominent that the search for more of it had intensified in various communities in the region.

Ironically, this was the genesis of the series of problems which have bedeviled the region in recent times. According to Premo (2005:16):

World attention shifted to the Niger Delta as oil rigs, wells and exploration activities eroded the territory, the initial excitement that greeted the discovery of oil in commercial quantity in the modest community of Oloibiri, soon died down. Exploration came with exploitation and like early colonialists into Africa; the western oil companies noticed the euphoria of the rural populace. For a little carrot of a ferry terminal or jetty, millions of dollars worth of oil was taken from their land. And then one day, the people woke-up to the reality that rather than peace and joy, the black gold had brought sorrows and tears to their land……….. Their dreams died in their strides. There could be more poor people in the region than there are in the remotest part of Koma, a primitive society in Adamawa State. 

The emergence of oil industry did not only undermine the Agricultural sector which was the mainstay of the local economy and create serious environmental hazards for the people through exploration, exploitation and transportation of oil and gas; it equally created serious value problem as the hitherto cherished traditional value – system were weakened by the emergence of the petro-dollar related behaviour.

 The Niger Delta region of Nigeria richly endowed with both renewable and non-renewable natural resources. It contains 20 billion of Africa’s proven 66 billion barrels of oil reserves and more than 3 trillion cubic meters of gas reserves. Oil and gas resources account for over 85% of Nigeria’s gross domestic product (GDP), over 95% of the national budget and over 80% of the nation’s wealth. A. A. Akinbuwa (2008)

 Paradoxically, the Niger Delta remains the poorest region as earlier stated, due to the ecologically unfriendly exploitation of oil and gas and state policies that expropriate the indigenous people of the Niger Delta, of their rights to these natural resources. 

Ecological devastation, which is occasioned by the activities of multinational oil companies (MNOCs) have rendered useless farming and fishing, which was previously the mainstay of the Niger Delta rural populace. The Niger Delta environment is not developed to further sustain the people after the destruction of the ecosystem that had kept the people together. The height of it is that the environmental degradation continuously occur through oil exploration activities such as gas flaring, oil spills, canalization to oil fields, seismic explosives detonation etc. thereby creating artificial challenges to development but the region is not considered for holistic development, rather the concepts of wider, national and internal power struggle to control meager funds for the development of the Niger Delta are always been politicized. Hence, the areas remain in dire need for development.

It is the dynamics of this interconnectedness and probable solutions to the problems causing the challenges of development despite the huge oil revenue from the area; that we intend to explore in the course of this research.

However, for practical purposes, the Niger Delta area is defined as an embodiment of the area enveloped by the natural Delta of the River Niger and the areas to the East and West that also produce oil. The natural boundaries of the region can be defined by it hydrology and geology. Its approximate Northern limits are located close to the divide into two of the River Niger at Aboh, while the West and Eastern bounds are located at the Benin River and Imo River respectively (UNDP, 2006:19).

In terms of component states, there is always a polemic in which states actually constitute the deltaic region referred to as the Niger Delta. As a result, reference is made of periphery and core states. A trace of the region thoroughly obviously indicate that states along the deltaic region are Bayelsa, Delta and Rivers State, hence, these three constitute the core Niger Delta states while considering the introduction of certain political and administrative motives in the definition of Niger Delta, has culminated to the inclusion of six (6) more states namely; Abia, Akwa Ibom, Cross-River, Edo, Imo and Ondo States.

Looking at the map of Niger Delta, following its definition encompassment of the nine (9) states structure, it appears like a jigsaw shown the nine (9) states situated in the Southern part of Nigeria with a boundary to the south by the Atlantic Ocean and to the east by Cameroon. The region covers a land mass of about 75, 000 square kilometers and it accommodates about 30 million Nigerians belonging to about 40 different ethnic groups with almost 250 languages and dialects.

The ecology of the Niger Delta tolerates myriad species of terrestrial and aquatic plants and animals and human beings. The region posses a division of four (4) ecological zones viz: Costal inland zone, Mangrove swamp zone, Fresh water zone and Low level rain forest zone. It is considered the most tremendous wet land in the African continent and among the three (3) largest in the world. The Niger Delta region is consist of rivers, creeks, estuaries or seas and the area accumulatively measures up to 2, 370 square kilometers, while stagnant swamps covers up to 8, 600 square kilometers.

As a matter of facts, this research will be focused on the real “deltaic” zones of the Niger Delta where the real challenges of development are prominent in order to properly assess and harness “oil exploitation and challenges of development in the Niger Delta. 

1.2       STATEMENT OF PROBLEM

Oil exploitation and exploration which has its root in the Niger Delta was celebrated February, 2008 as fifty (50) years of oil exploitation in Nigeria. In spite of wealth generation by oil exploration and exploitation, opinions of observers on the performance of the oil production sector especially its developmental relation with oil host region/communities has not been impressive. Nigeria’s former two times petroleum minister and former president of OPEC, Rilwan Lukman describes oil production in

Nigeria as “a blessing and curse (Aiyetan 2008:30). Similarly Shamudeem Usman, Nigeria’s former minister of finance observed that Nigeria remains poor in spite of being rich with oil (Tell, 2008: 32).

Actually, some persons and companies have benefited enormously from the proceeds of the Nigerian oil while some communities and millions of people from the source of oil “The Niger Delta” have been underdeveloped, long neglected and impoverished. The people of the Niger Delta are faced with problems as a result of the oil exploitation. The region in expectation of positive societal benefits, ironically seems to be the least developed despite the fact that the nation depends solely on its wealth. The Niger Delta oil exploitation story is clearly synonymous to the aphorism that goes thus:

The hen lays the golden eggs but not fed allowed to be in hunger perpetually.

The people of Niger Delta while facing the challenges of development on their environment are simultaneously taking into cognizance the impact of oil exploration on the environmental degradation of the land and the economy as well as socio-political well-being of the people of the host communities; hence the situation has caused the inhabitants of oil areas physical, emotional, psychological and counter value frustrations as a result of the Federal government’s deliberate policies and structure that causes human suffering, death, harm, deprivation, exclusion and oppression; a situation that leads to the extermination of the people’s cultural norms and practices that creates discrimination, injustice and human suffering. This systematic alienation of the federal government and Multi-National Oil Companies (MNOCs) finally culminated to frustration-worries-Anger and to violence. 

As a result of the negativity recorded in human, capital and infrastructural development of the Niger-Delta and particularly oil host communities in the region, the inhabitants of the Niger Delta seeing the wealth from their area being extracted without benefits have resorted to taking matters into their hands; kidnapping oil workers, pipe-line vandalisation, militancy/insurgency, inter/intra communities civil strife among other deviant social vices have become the order of the day. It is in the light of the above intricacies that the researcher intends to focus attention on the following research questions:

1.     Is there any link between oil exploitation in the Niger Delta Region and growing poverty level in the oil bearing communities?  

2.     Has oil prospecting improve infrastructural facilities in the Niger Delta Region? 

3.     Has the crises situation in the Niger Delta Region reduced the oil producing capacity of Nigeria?   

1.3       OBJECTIVES OF THE STUDY

The broad objective of this research is to investigate oil exploitation and challenges of development in the Niger Delta region.

However the specific objectives are two fold.

1.     To systematically investigate if there is any relationship between crude oil exploration and the poverty level of oil bearing communities.  

2.     To critically examine whether oil proceeds had not improved

infrastructural needs of the Niger Delta and the effects of crises on oil production in Nigeria. 

1.4       SIGNIFICANCE OF THE STUDY

We firmly believe that the findings of this study shall be of immeasurable value to the oil host communities, the Niger Delta region, oil companies, state governments in the Niger Delta and the Federal government.

The study shall expose certain shortcomings in our approach as students/researchers to tackle the Niger Delta question in the Nigerian Federation. Multi-national oil companies (MNOCs) and government shall through the result of this research rededicate their efforts to the morality issues of why the Niger Delta region requires aggressive development.

Equally significant is that subsequent researchers will find results of the project useful particularly in the fields of social sciences and crises management oriented topics.

The research will equally serve the task of filling a gap in existing literature and ultimately add to knowledge because the work is not devoid of the academic tradition of knowledge built on existing knowledge. Therefore, researchers/scholars in this era of western capitalist economy  with  its major tenets of globalization, market forces and liberalization of trade, the MNCs are on the offensive in both the extractive and manufacturing sectors all over the world. The agents and the states propagating these ideas refer to it as social relations. 

This  research work will reveal the hidden character which is causing instability in a region which is poverty stricken  in the midst of plenty, the Niger  Delta Region of Nigeria, an environment responsible for the economic boom which the Nigerian government has enjoyed for decades but nothing to show in the region. 

Finally, for practicality, the research will serve as a means to understanding the intrigues  in oil production that metamorphosed to underdevelopment and crises in the Niger Delta Region. Hence, the tasks of solving the crises and possible enhancement of socio-economic development and unity of the Niger Delta and Nigeria as a whole is achievable via application of moral standard to oil exploitation as cited in this study.          

1.5       LITERATURE REVIEW

The core variables of the research which are oil exploitation and challenges of development in the Niger Delta region will be the basis for our literature review.

The issue of oil exploitation and challenges of development in the Niger Delta region of Nigeria has created a lot of devastating effect on the oil bearing communities otherwise referred to as the (HOST COMMUNITIES). The socio-economic malady has no doubt attracted the attention of many scholars and social workers. However, the two major variables of the research which are: Oil exploitation and Challenges of development in the Niger Delta will be explored then a thorough review of literature will follow.

OIL EXPLORATION AND EXPLOITATION

The oil prospecting and exploitation in the Niger Delta has not only altered people’s livelihoods, but continues to disrupt the natural balance of the region’s earth crust. George (2000) recognizes the methods of oil exploration, namely: Analysis of existing geological and other information; seismic surveys; and exploration drilling; He mentioned that of particular destructive impact of the earth’s make-up is the use of seismic survey.

 This method involves the gathering of information through sound waves into the earth’s crust to measure the depth of the rock layers and the use of dynamites and other explosives. The explosives are either detonated in the bowels of the earth through water bodies or dry land. In addition to its direct impact on the aquatic stocks in the area, the after effects or shocks are known to sometimes cover as much a radius of 10 kilometers (Bassey, 2001). The implication of this is that, the more oil is explored in the Niger Delta region using this method, the more the region’s natural environment witness shocks and rifts in its crust.

DEVELOPMENT 

Development means different thing to different people, depending on their intellectual, ideological beliefs and the issues in question (Obinozie, 1999:157). Thus, it is seen as the process by which people, based on their choices and value create and recreate themselves and their life circumstances to realize higher levels of civilization (1996:125). It also means reduction in the level of poverty, unemployment and inequality (Secre,1975) Another definition of development is that: it is the liquidation of poverty, employment generation and satisfaction of basic needs. (South commission report, 1993:13-14). Development also refers to the efforts and results of transforming the physical and social environments within which human beings operate for the purpose of enhancing their standard of living. (Anikpo 1996:6); another definitions says development means an increase in percapital income, reduction of absolute poverty and equal distribution of income (Meieir, 1970).

Development efforts are connected and it includes those directed at deliberately eliminating obstacles that militate against the desire of individuals and corporate groups to free themselves from all natural and artificial obstacles. They also include the advancement of human capacity to exploit, annex, and utilize the historical, cultural and environmental based resources in order for man to achieve a more fulfilling life. However, resources and capabilities for development are usually not only complex but also in short supply. A high degree of collaboration is always needed. Thus, development partnership is a mechanism for ensuring that the comparative advantages of different actors, share and stakeholders are harmonized in a mutually supportive manner for the benefit of all.

It is an obvious fact that the concept of development is a man – centred process that leads to qualitative improvements in the standard of living. The measurement of development include, advanced infrastructures, enhanced education, training and greater employment opportunities, affordable cost of living, probity and accountability in governance, greater self-reliance especially, stability, affordable food, production, development of technology, improved productivity, sustained political stability, and a healthy population (Onuoha, 1999:71-72).

Therefore, there is no doubt that development addresses a number of objective factors that include conflicts and insecurity. Poverty, unemployment, uneven distribution of income and resources and political instability etc. which are causal factors of conflict, but with development these are tackled.

THE NIGERIAN STATE AND CURSE OF OIL PRODUCTION

Yakubu Gowon former Head of State of Nigeria (July 29th 1966 – July 29th 1970) delivered a key note address at the opening session of the international conference of the Nigeria state, oil industry and the Niger Delta on the 11th March, 2008 in his words:

Specific regulations were not put in place to remedy the Niger Delta and such regulations were to be reviewed from time to time. Efforts were made to develop the oil producing areas. Both Federal and state governments consider such efforts and plans in their government development plans.

Niger Delta is overdue for development. The plans         earlier put       in         place   during             my administration which would have addressed the problems were not only implemented but totally abandoned to the detriment of the region and nation (Yakubu Gowon, 2008).

Nigeria is the largest exporter of oil in the Sub-Saharan Africa with a production figure of 2.3 million barrels per day (bpd) hence, Nigeria is ranked behind the world’s oil giants: Saudi Arabia, Venezuela, Iran, and the United Arab Emirates. Nigeria’s petroleum revenue averagely accounts for over 85% of the Federal Government’s income and more than 95% of export earning. However, Nigeria at large in the midst of this wealth records an overwhelming high level poverty (with 70% living on less than one dollar a day), 40% lack sanitation and safe water, 82% lack access to regular power supply and 46% predominant infant mortality rate (Okaba, 2005).

Oil exploitation and exploration which recorded its boom in the early 1970s in Nigeria’s Niger Delta Region which was a rare opportunity to develop the Niger Delta and Nigeria at large turned to a breeding ground for official squandemenia. For instance, Nigeria hosted the FESTAC 77 so lavishly that Nigeria’s bid to host the next edi


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