Oil and Gas Production Industry

2578 Words Feb 22nd, 2013 11 Pages
MKIB 160
DEVELOPMENT OF INTERNATIONAL BUSINESS
MKIB 160
DEVELOPMENT OF INTERNATIONAL BUSINESS

Competitiveness of Oil and Gas Production Industry in Nigeria
Competitiveness of Oil and Gas Production Industry in Nigeria

LIST OF CONTENTS

Introduction…………………………………………………………………. 3

Nigeria 1.1 Background of Country…………………………………………. 4 1.2 Economic Overview………………………………………………….. 4 1.3 Global Competitiveness…………………………………………. 5

Porter’s Diamond Framework
2.1 Context for Firm Strategy and Rivalry……………………. 6
2.2 Demand Conditions………………………………………………. 8
2.3 Factor (Input) Conditions………………………………………. 9
2.4 Related and Supporting Industries…………………………. 10
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Global Competitiveness Ranking in Sub Saharan African Countries COUNTRY | GCI 2010-2011 | GCI 2011-2012 | CHANGE | SOUTH AFRICA | 54 | 50 | -4 | RWANDA | 80 | 70 | -10 | BOSTWANA | 76 | 80 | +4 | KENYA | 106 | 102 | -4 | NIGERIA | 127 | 127 | 0 | ZIMBABWE | 136 | 132 | -4 |
Source: Global Competitiveness Index Ranking © 2011 World Economic Forum |www.weforum.org/gcr
PORTER’S DIAMOND FRAMEWORK
2.1 Context for Firm Strategy and Rivalry
After 50 years of exploration, the first oil was discovered in Nigeria in 1956 at the Niger Delta and was made by Shell-BP. Only in 1970 where there is rise in the oil price due to the end of Biafran war that Nigeria was able to become rich instantly from its oil production. In 1971, Nigeria then decided to join the Organisation of Petroleum Exporting Countries (OPEC) and established a state owned and controlled company which was named Nigerian National Petroleum Company (NPCC) in 1977.
Nigerian National Petroleum Company is mainly responsible for the context of firm strategy and rivalry of the oil industry in Nigeria. The increase in the oil reserves and gas utilization is also achievable due to the introduction of various incentives by the government which includes a Memorandum of Understanding that will guarantee a profit margin of 2 US dollar per barrel. This had allowed an increase in

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