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Oil Revenue And Northern Governors’ Agitation

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This is the conncluding part of this article first published on Wednesday.

Government admitted that 40,000 oil spills had occurred in the past 53 years of oil exploration. In the report, the World Bank claimed that the palm groves, shorelines, creeks and other habitable areas would be washed away by erosion as well as spills due to vandalism, system failure and crude oil theft.  Apart from effects of oil spills, gas flaring constitutes a veritable hazard. It causes acid rain which acidifies the lakes and streams and damages crops and vegetation. It reduces farm yields and harms human health; increases the risk of respiratory illnesses, asthma and cancer and often causes chronic bronchitis, decreased lung function, blindness, impotence, miscarriages and premature deaths. Constant heat and the absence of darkness in some communities have done incalculable damage to human, animal and plant life in affected areas. Gas flares also cause affected places to be covered in thick soot, making even rain water unsafe for drinking. A United Nations Environment Programme (UNEP) report, last August, criticised how the Shell Petroleum Development Company (SPDC) deals with the environmental damage it has caused in the Niger Delta, especially in ogoniland. UNEP said Ogoniland needed the world’s largest ever oil clean_up, which would cost an initial $1billion or N160 billion and could take 30 years. How Ogoniland and other polluted communities would be cleaned is a matter of conjecture. If now that oil revenue is available the areas cannot be cleaned, is it when the revenues cease that the task will be embarked upon? By projection, Nigeria currently has proven crude oil reserves of about 37.2 billion barrels which at the current rate of exploitation (2.5mbp) may be exhausted in the next 40 years unless new deposits are discovered. Like most oil-bearing areas of the world, the Niger Delta has a tough terrain, which needs huge funds to be developed. Often times, oil producing areas are marshy or arid and most of the parts of the Niger Delta is marshy. The devastation of the Niger Delta region has been attributed, among others, to many failures of policy in the region and refusal of the government to pay special attention and inject funds into the area for development. Till date, no city in the region has been mapped out for a special development as the government did in Lagos and Abuja.”

“In the beginning: In 1958, before crude oil became a critical factor in Nigeria’s development, Sir Henry Willink’s Commission recommended that the Niger Delta region deserved special developmental attention by the Federal Government because of its difficult terrain. In response, the government established the Niger Delta Development Board (NDDB) in 1960 to tackle the developmental needs of the region. The board in  its seven years of existence achieved little or nothing. It was consumed by the military coup of 1966 and the outbreak of the civil war in 1967. Before and shortly after Nigeria’s independence in 1960, the federating units (regions) retained 50 per cent of revenues derived from their areas and contributed the rest to the central pool. It was on this basis that the regional governments led by late Chief Obafemi Awolowo (West); Dr Nnamdi Azikiwe (East); Sir Ahmadu Bello (North) and later Dennis Osadebey (Mid-West) unleashed unparalleled development in their respective areas. However, the 50 per cent derivation principle was kicked aside by the military in 1967 as earnings from crude oil skyrocketed. First, parts of the proceeds were used to prosecute the Nigeria-Biafra civil war of 1967 to 70. After the war, the military rulers refused to return to the status quo and chose to disburse funds to the states as they deemed feat. The military also created numerous states and local councils, which were funded with oil money. The oil producing areas were short-changed in the series of state and councils creation sprees. The President Shehu Shagari Administration set up a Presidential Task Force (popularly known as the 1.5 % Committee) in 1980 and 1.5 per cent of the Federation Account was allocated to the Committee to tackle the developmental problems of the region. This committee could not achieve much. There were doubts if the government actually disbursed 1.5 per cent of the revenue to the committee. And most of the funds released were allegedly looted.

So, when General Ibrahim Badamasi Babangida came to power, he set up the Oil Mineral Producing Areas Commission (OMPADEC) in 1992 and allocated 3 per cent of federally collected oil revenue to it to address the needs of the areas. Like its forebears, the OMPADEC, which initially raised hopes also failed to deliver as it perceptively became inefficient and corrupt. When General Sani Abacha took over, he set up the Petroleum Trust Fund (PTF) headed by Major General Muhammadu Buhari (rtd). The PTF did not meet the yearnings of Niger Deltans as its mandate covered all parts of the country. With critics saying that the PTF carried out more projects in northern parts of the country, restiveness in the Niger Delta assumed a higher gear. Abacha convened a National Constitutional Conference (NCC) in 1994, where conferees agreed on at least 13 per cent derivation. Abacha did not live to implement the recommendation. His successor, General Abdulsalami Abubakar included it in the 1999 Constitution, which he handed over to President Olusegun Obasanjo on May 29, 1999. On his part, Obasanjo scrapped the PTF and established a special body, the Niger Delta Development Commission (NDDC), to undertake rapid development of the impoverished oil region. He foot-dragged on the payment of the 13 per cent derivation until the oil producing states got a court judgment, which forced him to pay the proceeds beginning from June 1999.”

“At the National Political Reforms Conference (NPRC) convened by Obasanjo in 2005, South-South delegates insisted on 25 per cent derivation and had to walk out on the gathering when the other parts of the country said they could not approve anything more than 18 per cent, which was later recommended. However, this recommendation did not see the light of the day and died with Obasanjo’s alleged third term ambition. On succeeding Obasanjo, late President Umaru Musa Yar’Adua established the Ministry of Niger Delta Affairs, to offer more palliatives to the region. When militancy took the upswing in the area and knocked down oil production to about one million barrels per day, he also offered amnesty to the militants, a programme that has gulped billions of Naira.

The current fire of derivation controversy raging in the polity was ignited a few weeks ago when a host of northern leaders including Central Bank of Nigeria (CBN) Governor, Malam Lamido Sanusi; Niger State Governor and Chairman of the Northern Governors Forum (NGF), Dr Mu’azu Babangida Aliyu; the Arewa Consultative Forum (ACF) and Dr. Junaid Mohammed decried the huge revenues going to the oil producing states and sought reduction of the proceeds to free more money that could be allocated to northern states. Some of them attributed the Boko Haram insurgency ravaging many northern cities especially in the North-East geo-political zone to poverty arising from disproportionate revenue allocation to the North. The northern demand drew the ire of some Niger Deltans, who demanded true federalism and 50 per cent derivation.

 “Disturbed by the dangerous dimension the derivation question and other issues such as insecurity and stunted growth were taking in the country, former Commonwealth Secretary General, Chief Emeka Anayaoku, has canvassed a return to true federalism, to address the issues. Speaking a colloquium to mark Asiwaju Bola Ahmed Tinubu’s 60th birthday in Lagos, he said: “I do believe that a true, rather than our current unitarist federalism, will better promote peace, stability and development in Nigeria. There can be no doubt that Nigeria was making more progress in national development in the early years of its independence when it practiced a true federalism of four regions with more extensive powers devolved from the centre to the regions. Those were the days of the significant export of groundnuts,  hides and skins, and the tin ore from the North; of cocoa from the West; of rubber from the Mid-West; and of palm produce and coal from the East of Nigeria. They were also the days of such achievements as the free universal education and introduction of television in Chief Awolowo’s Western region, and of the budgeoning industrialization of Dr Okpara’s Eastern region.”

“To return to true federalism, we need a major restructuring of our current architecture of governance.  We would need six  federating units, instead of our present 36, which not only sustains an over dominant centre, but also compels the country to spend not less than 74 per cent of its revenue on the cost of administration.

“We need to convene a national conference of appropriately chosen representatives of the six geopolitical zones to dialogue on how to face these serious challenges. I believe that if we are to recapture the zeal with which the then regional Premiers and their electorates embarked on the development of their regions, if we are to arrest  the present destructive competition between our various ethnic groups for the control of power at the centre, and if we are to repair the collapse in our societal value system which is at the root of the pervasive corruption and degradation of our public services, we should aim at getting the national conference to reach a consensus on devolving from the centre to the six federating units responsibility for such areas of governance as internal security including the police, infrastructure, education, health and economic development.” Anyaoku’s suggestion has the endorsements of many eminent Nigerians drawn from all parts of the country.

The agitation against the 13% oil revenue derivation to oil producing states and the attendant ecological and devastation from oil exploration without commensurate infrastructure development of the region is unfair and unjustifiable in the face of recent Boko Haram insurgence and agitation for more revenue from the Northern States.

Dr. Akpogena, a Christian devotional Writer/Minister, Educationist and Consultant writes from Port Harcourt.

 

Lewis Akpogene

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Business

Investment Expert Urges FG To Partner Zuga To Grow E-Naira

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An investment expert in Port Harcourt, Revelation Ohio, has called on the Federal Government to partner with Sam Zuga to grow e—naira to become the Nigeria’s digital currency in the cripto market space.

He said this became necessary in line with what is going on in the global digital currency market, where many countries, including the developed Western nations, are keying into the cripto market.

Ohio, the Chief Executive Officer of the Leverage Hub Consulting Limited, who made this known while speaking in an investment forum in Port Harcourt on Sunday, said that Sam Zuga, a Benue State-born Reverend Father, was the first African to develop a digital coin, the Zuga coin.

He described the Reverend Father as a philanthropist who has made remarkable mark in investment all over the world, especially in Dubai, in the United Arab Emirates.

“Sam Zuga is the only African who has stretched himself to compete with those in developed countries in the cripto market, where all the digital coins are all non Africans.

“This man has stepped into the space and developed this coin named after him, and has strictly specified that the coin is African, and as we speak, this coin is strongly growing faster in the digital currency market.

“So it will be an advantage to the Federal Government, through the Central Bank that is considering to develop digital naira, to partner Zuga who is already in the space, as it used to be for those entering the market newly.

“This will have a multiplier effect on our people, as many unemployed persons will be engaged in the business, while the fortunes of many of the youths will be turned around”, he said.

The investment expert also urged the Nigerian public to take advantage of the space available in the cripto world to equip themselves financially, and get knowledge of the cripto market, since that is the way the world is currently going.

By: Corlins Walter

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Business

Brass Fertilizer Company To Create 15,000 Jobs

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Jobs – As Bayelsa Set For More Housing Estates

The Bayelsa State Government has allocated 595 hectares of land for the proposed Brass fertilizer company in Odioma Kingdom in Brass Local Government Area of the state.

This was as the government has also hinted that the bush clearing of the site of the said project has commenced in earnest.

The Bayelsa State Commissioner for Lands,Housing and Urban Development, Barr.Esau Andrew, disclosed this in Yenagoa, the state capital at the weekend.

He said that the Federal Government proposed project, when completed, was expected to create employment for not only qualified Bayelsans, but  has the capacity to engage no fewer than 15,000 workforce, with professional and un-professional qualifications.

Andrew who called for unity amongst the people of the host community, reiterated that the Governor Douye Diri’s led administration was willing to create the enabling environment for businesses to thrive in the state.

He averred that the government was also desirous of fast tracking the development of all communities and sectors of the state’s economy through impactful projects and programmes.

“The Brass fertilizer company is situated on a 595 hectares of land in Odioma kingdom of Brass council area.

“There are no problems with respect to the take-off and completion of this gigantic project, but what we currently have there are basically issues on intra-communal arguments as to who becomes the chairman, Odioma Council of Chiefs”, he said.

He added: “As a community member and commissioner in the state executive council, I can assure you that that can’t stall the project.

“Governor Diri has directed the community to toe the path of unity and peace so that they can benefit maximally from this enormous project, and the youths, chiefs and elders of the community are ready to do as directed by the governor”.

In the same vein, the government has reiterated its commitment to building additional housing estates in the state.

To this end, Andrew said that the Governor Diri administration in partnership with the Federal Government’s Ruhi 774 Housing Scheme and Shelter Afrique were set to build new 800 and 100 units housing estates, respectively in the state.

According to him, while the Ruhi 774 Housing Scheme being handled by Real Estate Development Association  of Nigeria (REDAN) is to build 100 housing units in each of the eight council areas of the state, Shelter Afrique on the other hand is expected to carry out the construction of another 100 housing units in Yenagoa.

He said further that the state government has also concluded plans to build additional 260 housing units in the yet to be developed hectares of land acquired by the previous administration for the Ayama-Ijaw Housing Estate in the Southern Ijaw council area of the state.

By: Ariwera Ibibo-Howells, Yenagoa

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Oil & Energy

Global Geopolitics, Neo-Colonialism Fuelling Apathy Against Crude Oil, DPR Hints

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Hints

The Department of Petroleum Resources(DPR), yesterday, allayed concerns over the future of crude oil globally, stating that the resource would continue to remain relevant for decades to come due to a number of emerging factors.

In his goodwill address at the ongoing 45th edition of the Society of Petroleum Engineers Nigeria Council(SPENC), Nigeria Annual International Conference and Exhibition(NAICE), Director and Chief Executive of the DPR, Engr Sarki Auwalu, argued that the current apathy towards crude oil is not driven by technical and economic considerations alone.

According to him, the ongoing narratives of the relative significance of each energy type and the clamour of ‘end of oil era’ is not informed by technical and economic considerations alone but by global geopolitics and the vagaries of neo-colonialism as well.

Auwalu maintained that crude oil’s continued relevance in decades to come is because of some of its features as an energy resource, which includes availability, accessibility, affordability, reliability, and efficiency.

This character of petroleum, he explained, gives it a degree of comparative advantage over emerging energy alternatives for secured and stable energy supply.

He said, “I would like to sum up the future of energy in these words: ‘for the foreseeable future, we would continue to see a mix of all energy sources – coal, oil, gas, nuclear, renewables – in the supply equation. Whereas renewable sources will make steady in-roads in the global mix, oil and gas will be relevant in decades to come’.

“This conclusion is informed by the outcomes of market analysis and forecasts based on demand-supply equilibrium, socio-economic fundamentals, climate change and environmental considerations as well as technology and innovation that is shaping the dynamics of global outlook.

“However, we would not delude ourselves that change is not happening; we must continually re-invent the industry and find ways to improve the environmental credentials of oil and gas by deploying technologies for carbon reduction and management to maintain its acceptability as fuel.”

He insisted that Africa, other oil-producing countries and members of the Organisation of Petroleum Exporting Countries(OPEC), must be key stakeholders in global energy discourse and ensure their voices and views are well articulated in discussions about the future of oil and gas.

“Indeed, as Africans, it must take its destiny in its hand and rewrite history, by leveraging abundant human and natural resources which nature has bequeathed on this great continent to create wealth for its people, eliminate poverty, and improve social-economic conditions while driving value for the globe. Only Africa can grow Africa,” he noted.

On its part, Auwalu disclosed that Nigeria had risen to the occasion, and had started using its oil and gas resources to drive value for national development in the face of challenges posed by energy transition and global dynamics.

Specifically, he explained that the DPR was fostering innovative ideas and creating opportunities for investments and sustainability in the petroleum industry, especially most recently, through the establishment of the National Oil and Gas Excellence Centre(NOGEC).

NOGEC, the DPR chief executive noted, was designed as a one-stop shop to drive safety, cost efficiency and value for the Nigerian oil and gas industry.

In addition, he said the DPR identified the need to formulate the Maximum Economic Recovery(MER) Strategy for Nigeria to guarantee the actualisation of sustainable resource optimization and the economic benefits arising therefrom.

The framework of the MER, he explained, was hinged on six pillars, namely: reserves maturation and production optimization; exploration and resources maturation; improved oil recovery and enhanced oil recovery (IOR/EOR) implementation; asset stewardship; performance evaluation and rewards; and risk management.

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