A SNAPSHOT INTO THE OIL INDUSTRY: The story of Nigeria and Nigerians (1)

By Taiwo 'Dimeji' and Kehinde 'Kayode' Balogun

The development of internal combustion engine in the early nineteenth century significantly changed the history of the world. Contribution per individual business entity spiked, and Western power had flexibility around military mobilisation for offshore expedition. The story of large hunt for oil began in earnest.

Crude oil was a limited and better alternative to charcoal that powered engines and replaced the early human energy sourcing (slavery) in the journey of industrialisation in the #West. The story of crude oil is a story of two opposing experiences; a story of cooperation and competition; a story of growth and destruction; a story of wealth and #poverty; and most importantly like every story of energy source, it is a story about how economic power is achieved and retained. Exxon, Mobil, Chevron, BP, Shell, Gulf Oil and Texaco were the front runners in the chase for large share of the global oil fields.

The #seven_sisters paved the way for commercial search and exploration of crude oil across the globe at a period where there was no ample of global extractive industry regimes to moderate oil companies' activities. The demographic spread of the nationality of the companies could help explain the pattern of economic development through industrialisation restructuring in the world. Five of them were registered in America, while Britain and Netherlands had one each. 

The conspiracy and operation of these transnational oil companies (TOCs) generated into fierce national demand for participation by the oil nations. In the Middle East, there was an active struggles to reduce the power of the companies and earn a fair return from the crude oil proceed that had been erstwhile controlled by the TOCs. The Baghdad Conference of 1960 organised by five countries (Iraq, Kuwait, Saudi Arabia, Venezuela and Iran) created an intergovernmental force and birthed the Organization of the Petroleum Exporting Countries (#OPEC) with a focus "to co-ordinate and unify petroleum policies among Member Countries, in order to secure fair and stable prices for petroleum producers; an efficient, economic and regular supply of petroleum to consuming nations; and a fair return on capital to those investing in the industry."

At the resistance of Iraq's leader, Mohammad Mossadeq, to model the country's oil export market through the formation of the National Iranian Oil Company (#NIOC) and nationalise the industry. Britain with the U.S. support mobilised military invasion into the territory and forced a new oil agreement on the nation. African oil stories have not be different in terms of control and politics. The Berlin conference of 1884 provided a template of appropriation into which oil fields were allocated and exploited. Nigeria is a major oil player in PetroAfricana - a term adopted from Duncan Clarke. Michael Peel noted that: "During times of full production, Nigeria is the largest oil exporter in #Africa and one of the top ten in the world." In recent times, it is Africa's largest producer of oil and the sixth largest oil producing country in the world.

In commercial terms, the Nigeria's crude oil story began in 1956 with the discovery of oil at Oloibiri in the Niger Delta by Shell-BP. Shell is being accused as a major facilitator of environmental and social crisis and an enabler of abuse in the Niger Delta. The sector has grown with multiple stakeholders local and foreign, small, medium and large across its value-chain options.

At the national level, proceeds from oil export becomes a major source of foreign earnings into the consolidated federation account with an attendant shift of interest from agriculture to creative ways of appropriating the juicy spreads that oil sales has to offer through kickbacks from licence issuance, rent, subsidy, contract bidding etcetera etcetera. Thus, fuelling and institutionalising rent-seeking as a national strategy.

Also, the politics of oil crippled in with implications. The oil producing states host demanded for 50% equitable share of the oil revenue which currently at 13% in order to address the issue of neglect, degradation and underdevelopment in the oil bearing communities.

The greatest impact of oil on the Nigeria's eco-political is dependency mentality and large scale of corrupt practices that have consistently define the various struggles for oil control in the country and in the Niger Delta region of the country. While report and literature are bound with evidences of indirect relationship that exist between agriculture and oil in Nigeria, it is worrisome to trace on a large scale the negative correlation that exists between oil and livelihood in the region. Port Harcourt, the capital of Rivers state, remains strategic to oil activities and infrastructures. The standard of living in the capital city depicts how oil divides society into core and peripheral; estates and slums with detrimental effects on the environment, particularly aquatic creatures caused by oil spillages and gas flare discharges.

Expectedly, cash cow draws attention. So is oil industry in the #Niger_Delta. There are clusters of skyscrapers housing units with foreign experts serving as departmental heads and board directors with fat paychecks to afford and push up the general price level of commodities, services and rental charges in the region.The attention of state government becomes how to improve facilities to incentivise oil industry's actors and retain connections with the company's head to facilitate personal dealings. Also, the governor with deep knowledge of his power - female governor has no record - as accounting officer of the state does subverts accountability in order to take enough from the coffer of the states' treasury by ways of earmarking bogus vote for projects some of which are either completed, nonexistent or little-cash demanding. In this respect, #James_Ibori and #Diepreye_Alamieyeseigh are notorious record breakers.

#Akwa_Ibom is a state we had visited and engaged academically. It appears that oil proceeds through extra 13% derivation allocation has helped to improve and beautify the state. The mega library at the heart of the city is well equipped with internet facilities. It has an adorable stadium that has frequently hosted soccer competitions. The road are motorable to the hinterlands - from Uyo to Etinan, from Etinan to Eket. The state was our Paris.

Beyond the modern infrastructures, there were no vibrant industries that could produce consumables and absolve the unemployed. Distributors and small businesses relied on commodities from neighbouring states as far as Southwest. Yale products flood Ekets' local markets to Ikot-Abasi sub. Fried plantains with roasted chicken were common staple in the city. Sadly, chickens were often and largely purchased from Ibadan, #Oyo_state. Selling price of commodities was relatively high, so was standard of living per individual.

Even though, the indifference of locals to agriculture has no direct link with oil, but the diversion of the state's priority from agricultural initiatives had more to do with oil free cash inflows; hence impacted the entirety of the state residents.

Access to power is access to oil cash. The road to power in those regions, more like other regions, are complicated and reinforced by scattered level of commands and actors, both local and foreign, and amplified by ethnic and cult contestation. There is a sense for power seekers to leverage on any of this weak link in social cohesion. The region has a high record of violent crisis; this does not take cognisance of the incessant arm struggles between #MASSOB or the Niger Delta People's Volunteer Force (#NDPVF) or other revolutionary/militia forces against the Nigerian state.

While political leaders court several of these armed organisations, they exploited the vulnerabilities of the unemployed and/or underemployed youths by engaging and arming them for political gains before, during and after election period. University students as well as colleague students who hold allegiance to cult group are not spared from recruitment into the pool of contingents. Only few of these (un)necessary supporters, footsoldiers, youth units were rewarded with full time employment in the civil services with permanent location at motor parks or markets.

Many others began to understood what their strengths were, and how best to express those energies through violence and economic subversion inform of bunkering, robbery, kidnapping, piracy, currency imitation etc. #Violence is a business, and as a business, there are competitors that must be constantly be suppressed for recognition and respect. 

 Oil businesses is capital intensive, and take long time to lay infrastructures underground as it is common to pipelines installations. Business entity is equally rational. The safety of the equipments, machines and plants as well as human capital cannot be compromised regardless of the state's position on private security. Many violent groups in the region where subcontracted by oil companies, even though secretly, to safeguard their resources against attacks. Prudence and ethics are submerged in those arrangements. Funds are allocated off balance sheet with the ultimate beneficiary being the warlords. Once fund is available, access to operational needs become easier. More guns, boats and necessary gadgets are purchased; comrades are paid and fed. This is the deeper side of the subtle connections of events that might give meaning to the constant violent struggles in region.

The struggle for the liberation of the Niger Delta region from the devastating process of the oil multinationals began at the heart of Ogoni land. A struggle that began with activism and moderate protest turned into a global embarrassment for the country and Shell Oil. In 1995, Keno Saro-Wiwa and few of his comrades were hanged by the then military junta headed by General Sani Abacha. There is an unstoppable power in the chain of action and reaction. Idea outlived its originator. In 1990, before his unjust murder, Saro Wiwa established the Movement for the Survival of the Ogoni People (MOSOP) as a nonviolent social-based movement to promote democratic awareness, protect the environment of; seek social, economic and physical development for; protect the cultural rights and practices of; and seek appropriate rights of self-determination for the Ogoni people.

With an understanding that access to oil with associated gas is crucial to the Nigeria's economy and global stability, and that nonviolent approach has limited reach in Nigeria, other ethical groups in the region took a new direction. Mujahid Dokubo-Asari is a face of the new direction, armed struggle. His movement was launched on the platform of the Niger Delta People's Volunteer Force (NDPVF). But before then, Asari was allegedly instrumental to the rise and fall of political actors in Rivers state, Nigeria. 

There is a parallel analogy to the rise of Boko Haram in the Northeastern part of the country. The leader, Mohammed Yusuf was an agent to a leading political party's aspirant. There is a sense in which state politicking enhances violence, and violence breeds on disconnections within the polity. On this chain of action and reaction, instability becomes a familiar indicator with lasting impact on people's livelihood and peace.

 Government's action of appropriate measure of force was a huge blow that continued to fuel insecurity in the region and has continually give rise to the upsurge of an armed industry that thrives on illegality and secrecy at the detriment of state's peace and community livelihood.