Nigeria is Africa’s largest oil producer, and has been a member of OPEC since 1971. Oil production accounts for 5.8% of Nigeria’s annual GDP and 80% of its government revenue. Despite arable land and many other mineral resources, Nigeria is unquestionably a petrostate, whose economy depends strongly on the price of oil, and which has failed to distributed earnings from that industry to much of the population. Violence, military rule and systemic corruption have kept this the case. Democracy’s roots are shallow in Nigerian society.
Pipelines through the Niger delta region.
Oil was discovered in the delta of the Niger River in 1956 by Shell-BP, and production began in 1958. By 1971 production and prices had risen enough for Nigeria to join OPEC. Foreign companies investing capital and expertise in finding and producing oil have been required to work with the government enterprise, the Nigerian National Production Company (NNPC). A 2021 law overhauling the industry changed the NNPC from a government to a private enterprise, to increase fiscal accountability.
Pipeline oil spill.
Major foreign companies currently active in Nigeria include Shell, Chevron, Exxon-Mobil, and Equinor (formerly Statoil, the Norwegian national oil company). Their presence in Nigeria has engendered turmoil, mostly through the environmental impact of pipelines and spills, and the corrupt handling of profits within Nigeria, leading to extreme inequality. Both the environmental and financial issues have led to ongoing civil unrest, particularly from the 1900’s on among the Ogoni and Ijaw tribes native to the delta region. The attacks and oil line sabotage have led to an estimated 240,000 barrels of oil being spilled annually in the Niger delta.
Results of an attack.
Disruption has included puncturing pipelines and either siphoning off oil, or letting them spill, or even setting the oil ablaze. There were repeated abductions of company personnel and attacks on facilities as locals demanded a share of the royalties for the pipelines running through their land. The conflict was militarized in the early 2000’s as tribal fighters gained access to firearms and eventually declared war on the Nigerian government. In 2008-09 the government answered the worsening conflict with a harsh military crackdown, followed by an amnesty program which lasted from 2009-16. Rebels turned to piracy, kidnapping workers from boats and platforms and demanding cash ransoms.
Nigerian oil production, 1974-2021.
The insurgency is ongoing, particularly in the extreme southern portion of Nigeria. There is some hope that the 2021 law which sets ambitious environmental and social justice standards, will help end the conflict. But Nigeria is at once a typical petrostate, dominated by a class of extremely wealthy people. At the same time, the country has for decades been a target of highly exploitive capitalism which deliberately weakens central governments. Nigeria is one of the world’s national poster symbols of environmental injustice.
Tomorrow: Nigeria and climate change.
Be brave, and be well.
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