TOPIC : THE DISCOVERY OF OIL IN NIGERIA, THE BEGINNING OF OUR ECONOMIC WOES
SUBMITTED BY – Temidayo Samuel
Crude oil was discovered in Nigeria on 15th January, 1956 at Oloibiri. Alliance with multinational oil companies like Shell, Chevron etc. has positioned Nigeria amongst oil producing nations in the world, with areas like Niger-Delta, Rivers,Bayelsa, Abia, Ondo, Edo, Imo etc. and about 606 oil fields.
Oil discovery at this period was a blessing because it came at a very timely period and a quick capital source, raised our standard of living, boosted our GDP and provided diverse job opportunities. The country thus become a prospective land attracting potential investors.
The downstream journey of oil discovery began when oil exploitation was tending to maximum and an extreme difficulty in management sets in. This literary piece aimed at highlighting the woeful implication of oil discovery in Nigeria.
Quick economic switch — upon discovery, the fiscal focal point was oil sector, thus incapacitating other sustainable revenue flow. No doubt that oil blocs produced quicker revenue than agricultural exports but oil discovery slammed domestic commodities with less value and they compete daily for demand and usage. Our government targeted an infinite return from oil, they wallow in its trillions and refused to expand other initial revenue sources which made the onetime expensive resource melt to an international struggling commodity.
Environmental hazards: Hazards in oil producing areas include;
Water pollution: During oil extraction and exploration, oil spillage occurs with negative effects on both aquatic and terrestrial lives.
Damaged Ecosystem: Water sources in oil areas aren’t potable, the aquatics cannot survive the toxicity and occupation like fishing is a thing of the past.
Rural-Urban Migration: Many residents of these areas have forcefully relocated to urban areas, owing to hardship in daily survival etc. Thus a congestive search of greener pastures in cities like Lagos, Port Harcourt etc.
Oil discovery is a threat to public and private health, infiltration of crude oil rendered the land infertile and halted agricultural activities. Life supposed to be fairer by government’s intervention but all they had was hope!
Societal and Political Effects: Consequences of oil discovery linger on with coruscating political conflicts between Residents cum loyalists and Federal government. Avengers clamoring daily for secession to ensure proper management of the nation’s only dependent resource on their land. Recently, the Ijaw nation raised alarm that Nigeria government is oppressing them with their crude oil.
Unemployment: Oil discovery was speculated to create mutimillion jobs with various activities but where are they today? International oil companies has taken over the real business deals with lot of expatriates in the sector and we insanely still import finished products from them. Such an economic deficiency!
The unproductive labor in the land has resolved to illegitimate acts like human trafficking, militancy etc. Yar’adua’s administration urged the giants of the land to surrender their arms and ammunitions in amnesty but corrupt officers maneuvered the idea and it gave rise to Avengers who blew up pipelines and sponsored attacks on oil workers and soldiers.
Recession: Buhari’s administration, 2016, ushered in a period characterized with economic meltdown and hyperinflation. It’s also a dependent outcome of failed international market, where there is a tussle and shortage in international oil market. Many oil demanding countries where our exports go to are on a diverse alternative power supply means has led to a fall in asking price. Oil in filling stations are sold at breathtaking prices (#145pms). An increment in oil-related resources automatically switched on the “price button” of commodities. This recent-time woeful effect of oil discovery, “Recession” is felt by every Tom, Dick and Harry, even to citizens in diaspora.
Falling standard of living: Having oil as the top national resource; the standard of living is getting lower and tending towards barest minimum. With a defaced Naira and a whooping exchange rate of #400 per dollar; the foreign exchange has not been smiling, one of the reasons majored on the hinge of shortage of exports and crashing of crude oil market. Gone are the days of food surplus, where local food items stood shoulder high with export goods qualitatively and an increasing export-import ratio, but today an average earner live in misery with hard-earned cash.
Its negative effects caused by Negligence has outnumbered its economic advantages. Measures to prevent further woeful effects are briefly highlighted:
Political justice and transparency: Only tested and trusted political figures should be made to hold port folios in a democratic government, not one with a crooked history. Justice should be uphold and not edited for a cause, fines and bails should be reviewed, any political figure with a previous criminal case or mismanagement should not be made to head any office again (or for a reasonable years), this will promote integrity and transparency. Effective means of management should be employed to reduce local and international debts and imports.
Crude oil is a nonrenewable source of energy and soonest renewable source of energy will take over globally. Thus, we should venture into the future to release the pressure on oil sector and then promote consumption of locally made commodities.
Economy Diversification: The national economic committee need to look inwardly and fund other sectors that will generate more revenue and provide job opportunities like agriculture, sciences, tourism, technology etc.
Oil refineries: This is undeniably one of the best things that could happen in the oil sector. With the high rise population of the country, importation should not be considered, rather a labor-intensive production technique, but we still depend on foreign products. Our major resource is been exported in its raw form with little face value and then imported at a breathtaking price per barrel. The four aged refineries should be repaired, restructured and contracted to private companies, with more erected to ease local production.
Oil sector has stolen attention from preexisting revenue-generated sectors, relenting our pursuits in economy development and leading us on a retrogressive trip.
Oil sector still have a lot to offer if properly managed and can still put the country where it ought to be, the economic king of the continent.