Business
Rivers: The Wheel Propelling Nigerian Economy
The economic importance of Rivers State to national development has never been in contention. It is easy to discern, even by the blind. It was not by happenstance that the state was christened the ‘Treasure Base of the Nation’. The state earns the sobriquet on account of its contributions to national development. What is rather in contest is the benefit accrued to the people of the state from the huge natural deposits the state is endowed with.
Generally known as the hub of oil and gas industry in the country, Rivers State accounts for 40 per cent of Nigeria’s crude oil production. It is also the largest economy in Nigeria after Lagos. It has vast crude oil reserves among other natural resources, and remains a leading supplier of the nation’s wealth with associated export revenue.
Apart from Lagos, Rivers State contributes the highest Gross Domestic Product (GDP) to the nation’s economy. It accounts for about 65 per cent of government revenue and 88 per cent of Nigeria’s foreign exchange earnings. As at 2010, Rivers State was contributing US$21,073 next only to Lagos with US$33,679 as GDP.
Despite its relatively low industrial base, the State has two of the nation’s four petroleum refineries at Eleme, two major seaports in Port Harcourt and Onne, an international airport at Omagwa, an oil and gas free zone, and a petrochemical and fertilizer plant in Onne, an industrial estate at Trans-Amadi, a gigantic liquefied natural gas plant in Bonny and tens of petrochemical related companies.
There is no gainsaying the fact that the aggregate growth of the Nigerian economy weighs heavily on the natural resources of Rivers State. For over five decades, the oil and gas sector has remained the mainstay of Nigeria’s economy till date. Little wonder that happenings in the oil and gas industry tend to have serious impact on the other sectors of the nation’s economy.
In the area of oil and gas which creates the wealth that sustains the nation, Rivers State ranks the highest contributor. Apart from playing host to two of the nation’s four petroleum refineries, the state also hosts major oil companies such as The Shell Petroleum Development Company (SPDC), Nigerian Agip Oil Company (NAOC), Total Exploration & Production Nigeria Limited (TEPNL), Nigeria National Petroleum Corporation (NNPC) and tens of petrochemical related companies. Added to these is the existence of a multi-billion naira Liquefied Natural Gas plant in Bonny which produces a million tones of gas per year.
It is, however, regrettable that in spite of Rivers State’s status as the hub of oil and gas in the country, these multinationals are reluctant to move their headquarters to the state citing insecurity and restiveness as excuses. It was even recently that NLNG relocated its head office to Port Harcourt.
Meanwhile, the new spate of development from marginal oil fields by the multinational oil giants has also created a vent for the participation of indigenous firms in the nation’s oil and gas sector. These firms include Minipulo, Nestoil, Belema Oil and Sahara Energy, among other upstream operators.
The import of this is that in spite of marginal neglect of the state by the Federal Government in terms of infrastructure and human development, Rivers remains the epicentre of Nigeria’s oil and gas activities, contributing a significant percentage of government’s revenue. That Nigeria was able to prosecute the three-year civil war successfully without borrowing a kobo was courtesy of the oil wealth. The oil boom of the 1970s also led to the mass importation of foreign manufactures, salary reviews and arrears payment, oversea scholarship and training of workers, among others.
Also given its position as a natural seaport and railway terminus, Rivers State has long established itself as an investor’s haven, with the bulk of its tenants in Trans-Amadi Industrial area of Port Harcourt.
Before now, there were several companies scattering around the state, such as Michellin, Pabod Breweries, Port Harcourt Flour Mills, Nigeria Engineering Works (NEW), West African Glass Industry (WAGI), Slumberger, Halliburton, Metalloplastica, Rivers Vegetable Oil Company (RIVOC), Riversbiscuit, Flag Aluminium, Indorama Eleme Fertiliser &Chemicals Limited, NAFCON, now Notore, among others.
Although a good number of these companies which once contributed to the economic growth of the state and Nigeria at large had since closed shop or relocated outside the country due to a number of factors ranging from poor electricity supply, general infrastructural decay resulting in high operational cost, multiple taxation and insecurity; a handful of them that are still in existence in the state make significant contributions to the nation’s economy in terms of employment generation and wealth creation.
Not too long ago, Pabod Breweries which was once moribund was revived by South Africa’s SAB Miller through a partnership that appears to be yielding good dividends to both the state and national economy, alongside Indorama Group.
Meanwhile, Rivers State also plays host to the second busiest seaport after Lagos. It hosts two of the nation’s seaports – Nigeria Port Authority (NPA), Rivers Complex and Onne Port. This suggests that the state constitutes a major commercial centre in the country. The state’s proximity to Aba in Abia State and Onitsha in Anambra State – two notable destinations for containerised imports, adds impetus to the commercial status of Rivers State, and also contributes in no small measure to the economy of the country.
Rivers State is not lagging behind either in the area of hospitality industry. Apart from the popular Hotel Presidential located along Aba-Port Harcourt Road, which has been in existence since the days of the Eastern Nigeria, there are several other hotels scattering around Port Harcourt and its environs. Prominent among them are Meridian Hotel at Old GRA, Port Harcourt; Landmark Hotel at Waterline area of Port Harcourt, Sasun Hotel at Trans-Amadi, and a host of others. The avalanche of these hospitality industries in the state does not only boost the economic base of the state, it also attracts and facilitates investment in the country.
Added to this impetus is the NEW vision of the present administration in the state led by Governor Nyesom Wike, which has led to a deluge of social infrastructures, thus attracting investments to both the state and the country at large.
It is, however, a painful irony that despite the avalanche of wealth tapped from crude oil sale and other economic opportunities in the state over the years, there has been a complete neglect of the state by the Federal Government in the area of basic infrastructure. For instance, the two major roads that link Rivers State with other parts of the country, namely, the Eleme section of the East West Road that leads to Onne industrial hub, and the Oyigbo section of the Port Harcourt-Aba Road have been in a state of disrepair for years without attention from the Federal Government.
Worst still, the multinationals that operate in the state and Niger Delta as a whole, and who ordinarily should be a propeller of development have only succeeded in adding to the sufferings of the people. They do not only devastate the environment with their oil activities and leave their host communities with destroyed farmlands, polluted air and deteriorating marine life, they also subject the indigenes to a second class citizens in terms of employment.
One of the most disturbing paradox is that crude oil for export is transported to Bonny and Forcados through a network of pipeline stretching across 6,000km over communities and living quarters approximately the distance between Cape Town in South Africa and Cairo in Egypt. Yet, little or no measure is taken to ensure the maintenance of the pipes which often corrode and burst, leading to oil spill, killing people and devastating environment, water and farmlands. Worst, the Federal Government that is supposed to be a regulator appears helpless and complacent as it lacks the political will to rein in on these oil conglomerates to stop the criminal environmental pollution in the state. This obviously accounts for occasional pockets of unrest and restiveness in Rivers and other Niger Delta states.
Many analysts and keen observers have decried the criminal neglect of Rivers State by the Federal Government. Piqued by the aberrant, incongruous structure of the Nigerian federation, especially the iniquitous disposition of the Federal Government in robbing Peter to pay Paul, a professor of Economics, Willie Okowa, had in a seminar presentation on Rivers State since 1967 said, “The use of oil resources derived largely from Rivers State in the creation of the infrastructure basis for development in other parts of the country while denying the same treatment for the territory in which oil is found speaks of a callousness that is numbing to the mind and an outrageousness that is a challenge to the ethics of civilised behaviour”.
The Rivers State governor, Chief Nyesom Wike himself has, at several fora, complained about the inequities and apparent lack of visible federal presence in the state despite the state’s contributions to the nation’s economy. He believes the state deserves a special status and consideration from the Federal Government given its contributions to national growth.
Presenting a paper on ‘Institutional Weakness and Challenges of Development in Rivers State in Abuja in 2016, Wike observed that, “the state has suffered sustained neglect, marginalisation and injustice from successive federal governments and its agencies”.
The governor continued: “Even as no new development project has been initiated in the state for decades, what is most distressing is the failure of the Federal Government to adequately maintain some of the critical federal infrastructure in the state.
“I am referring to the Port Harcourt Terminal building, the Port Harcourt seaport, as well as the East West Road, particularly the section that leads from Eleme junction to the Onne industrial hub that has remained broken for years without attention from the Federal Government.”
Five years after Governor Wike made this cursory observation, has anything changed? Perhaps not. Apart from the Port Harcourt International Airport Terminal building which was constructed recently, all other critical federal infrastructure listed by the governor for attention in 2016 have remained unattended to by the Federal Government. It took the intervention of the state government under Wike to fix two of the federal roads in the state: the Industry Road that leads to the NPA, Port Harcourt seaport and the Igwuruta-Chokocho Road.
Indeed, this disturbing irony of an oil state wallowing in poverty and squalor speaks of an utter insensitivity and indifference that is not only numbing to mind, but also strange to all ethical conducts.
But how long will this criminal neglect and deliberate marginalisation continue? When will the Rivers people get a fair share of the national cake? When will the Federal Government realise that Rivers State is the the wheel that propels the nation’s economy and should be accorded honour and respect? Who will rescue the Treasure Base of the Nation from the oppressive claws of national inequities? Questions. Endless questions.
By: Boye Salau
Business
NCDMB Hails Tinubu’s Oil Sector Executive Orders
The Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Felix Omatsola Ogbe, has commended President Bola Ahmed Tinubu over the announcement of three Presidential executive orders.
The orders, he said, are aimed at providing incentives in the Nigerian oil and gas industry, encourage new investments in the sector, reduce contracting costs and timelines, as well as promote cost efficiency in local content requirements.
According to a statement from the NCDMB’s Directorate of Corporate Communications and Zonal Coordination, the Executive Orders are the “Oil and Gas Companies (Tax Incentives, Exemption, Remission, ETC) Order 2024”, “Presidential Directive on Local Content Compliance Requirements, 2024 (EO 41)”, and the “Presidential Directive on Reduction of Petroleum Sector Contracting Costs and Timelines, 2024 (EO 42)”.
Speaking at the Nigerian Content Tower, headquarters of the NCDMB in Yenagoa, Bayelsa State, the Executive Secretary stated that the policy directives had reinforced the implementation of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act and codified the Service Level Agreements (SLA), which the NCDMB first introduced in May 2017, to fast-track approvals for the Nigeria LNG Limited Train 7 project, before expanding it to the entire industry after signing a Memorandum of Understanding (MoU) with the Nigerian National Petroleum Company Limited (NNPC Ltd), and five international oil-producing companies in September 2023.
Ogbe clarified that the Presidential Executive Orders did not whittle down the powers of the NCDMB or abrogate the schedule of the NOGICD Act.
He said, rather, the Executive Order 41 mandates the Board to ensure the patronage of local companies with domiciled proven capacities and capabilities to achieve cost competitiveness and project delivery within schedule.
He also noted that Executive Order 42 re-emphasized NCDMB’s obligation to fast-track approval processes as required by the SLA and section 23 of the NOGICD Act, which mandates the Board to review projects’ documentation within 10 days and advise the concerned operating company.
The Board’s helmsman assured that the NCDMB would comply with the terms of the Presidential Executive Orders, insisting that the Board had always been pragmatic with its implementation of the NOGICD Act, and mindful of the cost competitiveness of projects and schedules.
He also stated that the objectives of the Executive Orders and the SLAs were directed to shorten the oil industry’s contracting cycle to six months or less, engender speedy development of new projects, contribute to increased oil production, and improve the national economy.
The Executive Secretary expressed delight that President Tinubu had put his stamp of authority on the noble objectives of the SLAs, and commended him for acknowledging the giant strides recorded in Nigerian Content development.
Particularly, he noted the impressive capacities built by local oil and gas service companies in key areas of the industry and the substantial benefits that had accrued to the Nigerian economy and her citizens through local content implementation.
The NCDMB boss assured that the agency would continue to serve as a business enabler and maintain the recognition conferred by the Presidential Enabling Business Environment Council (PEBEC), which awarded the Board the most efficient agency amongst all Federal Government’s MDAs in 2022, and the PLATINUM rating by the Bureau for Public Service Reforms in recognition of the self-imposed reforms of the Board’s processes.
Ariwera Ibibo-Howells, Yenagoa
Business
Nigeria Opens Land, Air Borders With Niger Republic
President Bola Tinubu has directed the opening of Nigeria’s land and air borders with the Republic of Niger.
He also directed the lifting of other sanctions against the country with immediate effect.
A statement signed by the President’s Special Adviser on Media and Publicity, Ajuri Ngelale, said “President Tinubu has also approved the lifting of financial and economic sanctions against the Republic of Guinea”.
The statement is titled “Nigeria opens land and air borders with Republic of Niger, lifts other sanctions”.
The President’s directive has come just days after the ECOWAS Authority of Heads of State and Government lifted economic and travel sanctions on Niger, Mali, and Guinea at its extraordinary summit on February 24, 2024, in Abuja.
ECOWAS leaders had agreed to lift economic sanctions against the Republic of Niger, Mali, Burkina Faso, and Guinea.
Consequently, the President directed that sanctions imposed on the Republic of Niger be lifted immediately alongside others.
The sanctions are: “Closure of land and air borders between Nigeria and Niger Republic, as well as ECOWAS no-fly zone on all commercial flights to and from Niger Republic.
“Suspension of all commercial and financial transactions between Nigeria and Niger, as well as a freeze of all service transactions, including utility services and electricity to the Niger Republic.
“Freeze of assets of the Republic of Niger in ECOWAS Central Banks and freeze of assets of the Republic of Niger, state enterprises, and parastatals in commercial banks.
“Suspension of Niger from all financial assistance and transactions with all financial institutions, particularly EBID and BOAD.
“Travel bans on government officials and their family members”, the statement read.
Business
FG Targets Standards For Electric, CNG Vehicles
The National Automotive Design and Development Council (NADDC) has announced plans to validate its National Occupational Standards for the conversion and maintenance of electric vehicles and Compressed Natural Gas (CNG)vehicles.
The Director-General of NADDC, Joseph Osanipin, disclosed this during the validation workshop exercise for the draft of the national standards for auto gas vehicles in Nasarawa recently.
He stated that the primary objective of the workshop was to develop a blueprint for skills development and standardised operational procedures in the conversion, calibration, and maintenance of those new automotive energy sources, aligning with the government’s renewed hope agenda.
Osanipin noted that upon approval of the draft by the National Assembly, it would facilitate job creation and reduce greenhouse gas emissions, as ongoing plans include the establishment of more CNG gas stations in Abuja.
He said, “If we achieve what the Federal Government wants us to achieve with autogas, it will reduce the dependency on PMS and diesel and mitigate environmental concerns. It will also create more jobs and wealth for the nation”.
According to Osanipin, the essence of the workshop was to ensure that the input of all relevant stakeholders was captured in the making of this national document.
“This is in line with international best practices. It is expected that the document will come out of this effort at international standards and help to drive the auto sector to global standards”, he added.
He emphasised the significance of the Nigerian Automotive Industry Development Plan 2023 – 2033, relaunched by the Federal Government in 2023, aimed at revitalising the automotive industry and fostering sustainable growth through technological and skills development.
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