While it is only the 11th largest global oil producer, Nigeria is one the most important countries in the oil production community. Due to high quality crude oil, potential for future oil production endeavors, accessible location to the vast Western oil market, and continuing trend of non-nationalization, Nigeria has become the largest oil producer in sub-Saharan Africa. These advantages have developed Nigeria into a country entirely dependent on the production and exportation of oil. In 2007, oil encompassed 99 percent of Nigerian oil exportation earnings, making up 85 percent of the governments total revenue1. Despite 400 billion dollars in total oil revenue collected by the Nigerian government since 1970, the country faces a standard of …show more content…
In order to fully understand the mechanics of the clientalistic Nigerian oil governeance, one must first explore the structuring of the institutions tasked with overseeing the industry. First and foremost is the Nigerian National Petroleum Corporation, or the NNPC. The NNPC is the parent company comprised of itself and 12 wholly owned subsidiaries that range from oil trade companies to petrochemical plants. With a workforce of over 9000, the NNPC oversees operation both down and upstream on the Niger river. The NNPC controls such a large percent through its subsidiary the National Petroleum Investment Management Services (NAPIMS), an investment firm that acts as the concessionaire for the NNPC, brokering all the oil contracts on the behalf of the Nigerian government. Utilizing its incredibly high amount of government mandate in conjunction with its industry savvy personnel, the NNPC has postured itself as the leading influence over the Nigerian oil sector. Second in the pecking order is the minister of Petroleum, the official tasked with overseeing the NNPC. A position now (and much of history prior to 1999) held by the Nigerian president, the minister forms a tightly knit cabinet of advisors whose will governs the majority of oil-sector policy making. However, the position has lent itself to corruption, instilling concentrated amounts of power in an institution with
Situated along the coast of the Gulf of Guinea is a region about the size of South Carolina that offers a land full of sweet, light crude oil, known as the Niger Delta (Delta). The Delta sits within the country of Nigeria in West Africa and is in a constant state of crisis, underpinned by a multitude of key issues. Those issues include severe poverty, soil and water contamination, high infant mortality rates, low life expectancy, depletion of natural resources, corruption, and armed militia groups. These issues have one thing in common: oil.
Niger Delta region, placing the Nigerian oil output down to a third of its capacity” (Klare 3).
In Nigeria, the issue of mismanagement and underutilization which led to huge wastage of resources and manpower potentials gave the government of the day no other option but to pursue quickly the privatization and commercialization program. They are about six hundred (600) public enterprises in Nigeria, ran by or controlled by the federal government, many are controlled by the state government. These companies take a sizable portion of the federal budget and account for over 5000 patronage. Transfers into these enterprises ran into billions on Naira. These transfers were in form of subsidized foreign exchange import duty waves, tax exemptions and/or write off of unrequited revenues, loans and guarantees and grants/subventions. These companies
The "Curse of the Black Gold" is what they call it. The greasy money-making liquid can also cause the undoing of countries. Oil companies like Shell sometimes make as much money as the country they do business in. The hazards that come with extracting oil is understated while the rewards are often praised. To the companies, we are not important, it is the money we carry in our pockets that they care about. Shell, a billion-dollar making oil company, is slowly gaining a lot of recognition in countries as it is causing a lot of corruption due to several accidents as well as its influence on global warming. The company is most known for its fracking practices as well as its impact on Nigerian villages.
The Nigerian economy has quite the surplus of natural resources they offer the potential for economic growth. “Crude oil accounted for over 95% of exports and over 65% of government revenue in 2004;” Nigeria is number eight in the world's exporter for oil. But agriculture still is a big part in the basic economic activity for the Nigerians.
The Niger Delta is a region of Nigeria that is very rich in crude oil and gas. Crude oil and gas make up 70% of the country 's revenue and 95% of it 's export earnings (Ezekoli, 5608). Those percentages are incredibly high and represents large amounts of money that can be found in the region. However, the people of the Niger Delta never see the wealth that comes from their natural resources. The wealth instead goes to the oil companies set up in the area as well as the pockets of a few elite government officials. The disconnect between the people of Nigeria and the oil companies and governments is incredible (Ezekoli, 5609). The effects are slum turned neighborhoods, increased poverty, and job loss. In order to improve the conflict in the Niger Delta, the government and oil companies need to allow more involvement of women and people as voters and elected officials, and create or adhere a sustainable environmental regulations plan.
In 1958, oil was first discovered in Nigeria. The discovery has led to the transition from agriculture-based economy to that of oil economy. One would believe that a country that produces a numerous amount of oil used to support the world with energy would have improved domestic infrastructures and economic development. Unfortunately, this is not the case in Nigeria. Nigeria has suffered since the discovery of oil and is still suffering till this day. Not only has it created conflicts between other nations and Nigeria but it has also divided the country into groups, which has fueled civil wars and tension between the government and the people. This is why the topic is a geopolitical event but before trying to understand how it is geopolitical, one should understand what geopolitics is.
Nigeria is considered to be one of the most corrupt countries in the world. Many different forms of corruption are familiar to Nigeria including political corruption, bureaucratic corruption, electoral corruption, embezzlement, and bribery. Corruption has even been said to be a viable enterprise in Nigeria due to the involvement of citizens, government officials, and private corporations alike. Two main factors help explain why corruption and bribery are so high in Nigeria, these factors include Nigeria’s complete dependence on the petroleum industry and profit-focused companies taking advantage of a less developed,
Nigeria has been a country in political turmoil for a long time. The country was created in 1914 under British colonial rule and at that time it was considered a protectorate. It was not until 1960 that Nigeria received independence from the United Kingdom. One of Nigeria's problems politically is that it has over three hundred different ethnic groups. The three largest of these are the Hausa-Fulani, Igbo, and Yoruba. At the time of the independence of Nigeria it was split up into three states with each state being under the control of one of the major ethnic groups. The natural resources of the other 297 ethnic groups were exploited for the major three groups,
In cases like Nigeria, where a vast amount of petroleum was discovered, there is an export of about 12 million barrels of oil a day from Nigeria. The effects have
Oil production in Nigeria’s Niger Delta began in 1956. Ever since then, the Delta communities have recognized unrest as oil was being distributed in profitable quantities. Oil has been Nigeria’s leading export product for more than six decades. Even though, oil has given Nigeria a tremendous economic boost, nearly sixty percent of that oil production has been carried out under Shell’s regulation, and during these past six decades, there has been enormous environmental degradation because of frequent oil spills and gas flaring. This has led to a polluted fish ponds and declining growth of crops in Niger communities. Shell has personally financed Nigerian militants to insure the production of oil, and this has led to brutal murders and illegal executions of community members who tried to protest the damages that shell was creating to their environment. So why and how is Shell still operating and still committing human right crimes in Nigeria? This paper will explain why Shell has dominated Nigeria since the 1950s, how the company has damaged the lives of numerous communities, insured the production of oil to this day through militant use, and still managed to separate themselves from the many years of violence that they founded.
In his book, Black Gold: The story of Oil in our lives, Albert Marrin said, “By the fall of 1918, it was clear that a nation’s prosperity, even its very survival depended on securing a safe, abundant supply of cheap oil.” Crude oil is one of, if not the most important commodity in the world. And it has become something that is highly tied to the global economy as a result. The rise and fall of oil prices are used as indicators of what’s to come and how to prepare for it. The very prosperity of some nations is directly indeed directly tied to oil production or procurement. In this paper, I will be discussing the
The diversity of the country’s export base has been eroded by focus on hydrocarbon activities, however limited growth in the non-oil sector has helped diversify the economy during the past decade. Agriculture remains relevant as main source of employment. In the 1990’s, uncontrolled debt levels, debt restructuring, failure to meet payment deadlines and write-offs damaged Nigeria’s a reputation. Nigeria returned to civilian rule in 1999, after independence from Great Britain in 1960 was followed by years of military rule. (Nigerian Government, 2015).
The petroleum sector began to add significant role and shape to the Nigerian economy and the political arena and destiny of the country in the early 1060s. However, when Nigeria became an independent nation in 1st October 1960, Shell – BP began to give out its acreage and its exploration licenses were converted in to prospecting licenses that allowed development and production ( Bamberg, 2000; Vassilion, 2009). Following the increase dominance of the Nigerian
The Nigerian economy has several activities sectors which include agriculture (crops), livestock, forestry, fishing, manufacturing, crude petroleum mining and quarrying, utilities, building and construction, transport, communication, wholesale and retail trades, hotels and restaurants, finance and insurance, real estate and business services, housing, producers of government services and community, social and personal services. However, with the advent of the crude petroleum sector and its attendant boom in the international market, all other sectors of the Nigerian economy have experienced serious neglect by the government, thus resulting to an unbalanced economy.