Nigeria's struggle to break the 'oil curse' | FT Film
Summary
TLDRThe video script delves into Nigeria's struggle with its oil industry, highlighting the country's inability to refine its own oil, the impact of fuel subsidy removal, and the theft of crude oil leading to stifled investment. It discusses the potential of the Dangote Refinery as a game changer and the broader economic implications of Nigeria's heavy reliance on oil, including the neglect of other sectors like agriculture and the rise of artisanal refining. The script also touches on the environmental and social costs of oil production and the hope for a more diversified and resilient economy.
Takeaways
- 🇳🇬 Nigeria's inability to refine its own oil has been a longstanding issue, with the country exporting crude oil and reimporting refined products.
- 🛑 The removal of fuel subsidies in Nigeria caused panic and highlighted the country's heavy reliance on oil for daily life and economic stability.
- 💸 Corruption and mismanagement have stifled investment in Nigeria's oil sector, leading to poorly maintained refineries and lack of progress in the industry.
- 🏭 The Dangote Refinery, a $20bn project, aims to be a game-changer by processing a large volume of crude daily, potentially transforming Nigeria's economy.
- 👷♂️ The construction of the Dangote Refinery faced numerous logistical challenges, including building infrastructure from scratch due to the lack of existing facilities.
- 📈 Nigeria's economy is expected to diversify and grow in the coming years, moving beyond its current heavy dependence on oil revenue.
- 📊 The fluctuating supply of refined oil products has led to economic instability, with petrol stations running dry and affecting various sectors of the economy.
- 🌐 International oil companies like Shell and BP, who initially discovered oil in Nigeria, have been criticized for not participating in the country's refinery development.
- 💼 Entrepreneurial efforts in Nigeria are increasingly focusing on productive activities that create jobs and pay taxes domestically, rather than on oil arbitrage.
- 🎵 The impact of oil wealth on Nigerian society is complex, with some arguing that it has led to neglect of other sectors like agriculture and has not improved the lives of average citizens.
- 🚨 The Nigerian government's approach to managing oil resources has been questioned, with calls for more transparency, better distribution of wealth, and investment in education and skills.
Q & A
Why has Nigeria struggled to refine its own oil?
-Nigeria has struggled to refine its own oil due to a lack of investment, maintenance issues, and corruption within its refineries. The government-owned refineries have been unable to operate efficiently, leading to a reliance on importing refined products.
What was the impact of removing the fuel subsidy in Nigeria?
-The removal of the fuel subsidy in Nigeria led to panic and an increase in fuel prices, affecting the cost of living and transportation costs. It also highlighted the country's reliance on oil and the need for economic diversification.
How has the theft of oil affected investment in Nigeria's oil sector?
-Oil theft has stifled investment in the sector by creating an environment of uncertainty and risk. This has resulted in a lack of funds for necessary infrastructure improvements and refinery maintenance.
What is the significance of the Dangote Refinery project for Nigeria's economy?
-The Dangote Refinery is a significant project as it aims to be the world's largest single-train refinery, capable of processing 650,000 barrels of crude daily. Its success could encourage further investment in Nigeria and reduce the country's reliance on imported refined products.
What challenges did Dangote face in building the refinery?
-Dangote faced numerous challenges, including the need to build infrastructure such as a port, trucking factory, and power plant from scratch due to the lack of existing facilities in Nigeria. Additionally, he encountered difficulties in securing crude oil supplies for the refinery.
How has the discovery of oil in Nigeria affected its economy and society?
-The discovery of oil has had a mixed impact on Nigeria. While it brought wealth, it also led to over-reliance on a single resource, neglect of other sectors like agriculture, and environmental degradation. It also caused social unrest and conflict over the distribution of oil revenues.
What is the role of the Nigerian National Petroleum Corporation (NNPC) in the oil industry?
-The NNPC is a state-owned corporation responsible for managing Nigeria's oil resources. It is involved in the exploration, production, and sale of oil and gas, as well as paying fuel subsidies. However, it has faced criticism for inefficiencies and lack of transparency.
How has the fuel subsidy removal affected the Nigerian music industry?
-The removal of fuel subsidies has increased the cost of promoting music and organizing events, as everything from transportation to production costs has risen. This has led to a more challenging environment for artists and industry professionals.
What are the environmental implications of artisanal crude oil refining in Nigeria?
-Artisanal crude oil refining contributes to environmental pollution and degradation, particularly in the Niger Delta. It results in air quality issues, such as black soot, and the destruction of local ecosystems, affecting the livelihoods of communities.
What is the concept of 'Africapitalism' as mentioned in the script?
-'Africapitalism' is a concept that emphasizes the role of the private sector in making investments aimed at improving lives and creating social wealth. It focuses on achieving both profit and positive social impact, particularly in the context of African economies.
How does the script suggest Nigeria can move towards a more transformational economy?
-The script suggests that Nigeria needs to create investor confidence, diversify its economy beyond oil, and focus on skill development and empowerment of its youth. It also highlights the need for better management of oil resources for the greater good of all Nigerians.
Outlines
😔 Nigeria's Oil Refining Woes and Economic Struggles
The first paragraph delves into Nigeria's inability to refine its own oil, a problem that has persisted for generations. It highlights the impact of the removal of fuel subsidies, which led to panic and economic instability, and the negative effects of oil theft on investment in the sector. The speaker emphasizes the need for the government to recognize the ownership of oil by Nigerians and the hard work required to earn money in the country. The paragraph also touches on the nascent tech industry and the potential for a more diverse economy in the coming years. It discusses the absurdity of Nigeria exporting crude oil and then reimporting refined products, the challenges of local refineries, and the corruption and mismanagement that have plagued them. The Dangote Refinery project is introduced as a potential game changer for the Nigerian economy, aiming to process a significant amount of crude daily and reduce the country's reliance on imported refined products.
🏗️ The Dangote Refinery: A Monumental Undertaking
This paragraph focuses on the ambitious Dangote Refinery project, led by Aliko Dangote, Nigeria's richest businessman. It describes the challenges faced in building the world's largest single-train refinery, including the need to construct infrastructure such as a port, trucking factory, and power plant due to the lack of existing facilities. The paragraph underscores the potential impact of the refinery on Nigeria's economy, encouraging local and foreign investment, and shifting entrepreneurial focus from arbitrage to more productive endeavors. It also touches on Dangote's background in cement manufacturing and his role as a pioneer in the industry. The paragraph notes the refinery's progress, including test production of aviation fuel and diesel, and the hurdles faced in securing crude supplies, which have led to tensions with the Nigerian National Petroleum Corporation (NNPC) and even thoughts of abandoning the project.
🛑 Fuel Subsidy Removal and Its Ripple Effects
The third paragraph discusses the removal of fuel subsidies in Nigeria, which led to immediate crises, with riders unable to get fuel and filling stations halting sales or raising prices. It explores the impact on businesses, particularly the delivery platform Chowdeck, which has had to adapt by investing in non-fuel-based delivery methods such as bicycles and e-bikes. The paragraph also examines the broader economic implications, including increased costs for video directors, music producers, and band members, making it more expensive to promote music and participate in cultural events. The narrative reflects on the hardships faced by the Nigerian people due to inflation and the high cost of living, and the need for resilience in the face of economic challenges.
💰 The Economic and Social Impact of Fuel Subsidies
This paragraph examines the rationale behind the removal of fuel subsidies in Nigeria, which was intended to allow market forces to determine fuel prices. However, it notes that government intervention persists, and the true cost of petrol is likely higher than current prices due to inflation. The discussion extends to the historical and ongoing issues related to oil discovery in Nigeria, particularly the grievances of host communities in the Niger Delta who have not benefited from oil wealth. The paragraph recounts the protests led by Ken Saro-Wiwa against environmental pollution and the neglect of local needs, leading to his execution under a military government. It also mentions the Movement for the Emancipation of the Niger Delta (MEND) and the subsequent amnesty deal that attempted to address these concerns, though not without ongoing issues.
🌿 The Environmental and Political Ramifications of Oil in Nigeria
The fifth paragraph delves into the environmental devastation caused by oil operations in Nigeria, particularly in the Niger Delta. It describes the transformation of once-vibrant fishing communities into areas with dead water bodies due to pollution. The narrative highlights the role of multinational oil companies and artisanal crude oil refiners in contributing to this environmental crisis. The paragraph introduces the concept of 'Africapitalism,' which emphasizes the private sector's role in making investments that improve lives and create social wealth. It discusses the challenges faced by indigenous oil companies taking over from international companies, the impact of theft on oil production, and the need for investment and security to boost the economy. The paragraph concludes with a call for a transition from a transactional to a transformational economy to address the youth's restiveness and lack of opportunities.
🛑 The Struggle for Livelihoods and Environmental Justice
This paragraph discusses the struggle of communities in the Niger Delta for their livelihoods and environmental justice. It describes how local communities have been denied their traditional means of livelihood due to environmental pollution caused by oil companies and artisanal crude oil refining. The narrative includes personal accounts from a human rights defender and environmental activist, who calls for local and international attention to clean up the area and restore livelihoods. The paragraph also touches on the dangerous work of artisanal refining, the involvement of politicians and security operatives in illegal refining activities, and the broader implications of oil theft on Nigeria's ability to meet its OPEC quota and the environmental damage caused by illegal refineries.
🌟 The Future of Nigeria's Oil Industry and the Quest for Transformation
The final paragraph contemplates the future of Nigeria's oil industry, emphasizing the need for a transition from an economy reliant on oil wealth to one that is transformational and inclusive. It discusses the challenges faced by the industry, including theft, lack of investment, and the global push for energy transition, which has made financing for oil and gas more difficult. The paragraph highlights the efforts of Heirs Energies Limited to increase oil production and secure pipelines, as well as the government's role in supporting these initiatives. It concludes with a reflection on the broader economic and social implications of Nigeria's reliance on oil, the need for investor confidence, and the potential for a more diverse and resilient economy that confronts challenges and surmounts them.
Mindmap
Keywords
💡Refining
💡Subsidy
💡Theft
💡Investment
💡Dangote Refinery
💡OPEC
💡Infrastructure
💡Fuel Subsidy Removal
💡Economic Diversification
💡Artisanal Refining
💡Energy Transition
Highlights
Nigeria's inability to refine its own oil has been a longstanding issue.
The removal of fuel subsidies in Nigeria led to widespread panic and economic disruption.
Nigeria's heavy reliance on oil has overshadowed other potential areas of economic growth, such as technology and agriculture.
The country's refineries have suffered from poor maintenance, corruption, and lack of professional management.
The Dangote Refinery is a $20bn project aiming to be the world's largest single-train refinery.
Infrastructure challenges in Nigeria have necessitated the creation of independent systems for transportation, power, and more by businesses like Dangote's.
The Nigerian government's ownership of oil refineries has not resulted in successful petroleum product production.
The discovery of oil in Nigeria has had mixed outcomes, with some viewing it as a curse due to its overshadowing of other economic sectors.
The Nigerian National Petroleum Corporation (NNPC) has faced criticism for not delivering on crude oil supplies to the Dangote Refinery.
The removal of fuel subsidies has led to a reevaluation of government policies and their impact on the Nigerian economy.
Nigeria's potential to produce 2 million barrels of oil per day is hindered by theft and lack of investment in the sector.
The Nigerian government's focus on oil has come at the expense of other industries and has not necessarily benefited the broader population.
The country's youth are restless due to lack of skills, empowerment, and employment opportunities, posing a potential social risk.
Nigeria's oil wealth has not been evenly distributed, leading to questions about its use for the greater good of the nation.
The Nigerian economy is at a turning point with significant changes in refining capabilities and subsidy policies.
The need for a transformation from a transactional to a transformational economy in Nigeria is emphasized for long-term growth and stability.
Transcripts
Why Nigeria can't refine its own oil
is a question that's been asked for generations.
Two hugely important things have changed, refining and subsidy.
When the fuel subsidy was removed,
there was a kind of panic.
We now live on oil, sleep on oil,
eat on oil, which is unfortunate.
Because of the theft, it has created a scenario
where there has been a stifling of investment in the sector.
The government should know that we own the oil.
If you want to get money, in fact, in Nigeria,
you must struggle before you eat.
Our tech is just beginning to pick up.
Over the next few years, we will become a very, very diverse
economy.
How much do you have to hustle?
You have to hustle hard.
Nigeria has been a big oil producer for decades now.
But very little of that oil has been refined.
So you have this absurd position where Nigeria pumps oil, sells
it abroad, and then reimports it in the refined products
that it needs.
The idea, in theory, is that if you have a refinery that
operates locally, you would be able to pay in the local naira
currency and reduce quite a substantial amount
of your dollar exposure.
Regular supply of refined product
will definitely go a long way to help our economy.
Now we have epileptic supply, queues
at petrol stations, many petrol stations running dry.
Given its basic potential to produce roughly 2mn barrels
of oil a day, then the first move up the value added chain
ought to be through refining oil products.
Oil was recently discovered in the east.
Nigerians are developing their industry with their own research
methods and their own hands.
Shell and BP found oil in Nigeria in 1956,
four years before Nigeria got independence from Britain.
There was huge hope for Nigeria, then a country of 45mn people.
Princess Alexandra handed over control on behalf of the queen.
Now, finally free of the shackles of colonialism,
with the bonus of having discovered this great resource
that could fuel its own economy, make
money that could be spent in Nigeria on Nigerians.
I believe we made a very, very deadly mistake.
We put all our eggs in one basket of oil.
We even ignored gas.
We were flaring gas, which is a very important commodity.
I know many Nigerians who think the worst
thing that happened to an independent Nigeria
was to discover oil.
The currency becomes artificially overvalued,
making it very, very difficult to produce and export goods
because they're too expensive and making it very
attractive to import goods.
So all sorts of Nigerian industries got wiped out.
We ignored agriculture, which should
have been the centrepiece of our economic development.
The government owns four refineries.
But despite billions of dollars in investment over the years,
they've just never been able to refine petroleum products.
They've broken down.
They've run out of spare parts.
At best, they've run massively under capacity.
And when I was president, I invited Shell,
and I said, look, come and take equity participation
and run our refineries for us.
They refused.
They said our refineries have not been well maintained.
We have brought amateurs rather than bring professionals.
They said there's too much corruption
with the way our refinery is run and maintained.
And they didn't want to get involved in such a mess.
For years and years and years, there
have been pledges that the refineries will be fixed.
How many times have they told us that?
And at what price?
Those problems, as far as the government refineries
are concerned, have never gone.
They have even increased.
So if you have a problem like that,
and that problem is not removed, then you aren't going anywhere.
Our huge investment of over $18.5bn in this industry has
been prompted by our desire to support and contribute
to the federal government's sustained efforts to transform
our economy and properly position our country
as a leading nation in Africa.
The Dangote Refinery is a $20bn project that, at its peak,
is designed to process 650,000 barrels of crude daily.
Well, it is a game changer.
I think this is not hyperbole.
Dangote decided to take on the challenge.
So he's building the biggest single-train refinery
in the world.
This was a project that was happening in the swamplands.
So they had to build their own port
to receive manufacturing equipment.
There weren't enough trucks in Nigeria to truck
all the equipment.
So he had to build his own trucking factory.
With the power shortages in Nigeria,
obviously, they couldn't rely on the national grid.
So they had to build their own power plant from the ground up.
In Africa, there is no infrastructure.
So when we are looking for cranes,
we couldn't get cranes to even hire.
He's had to kind of remake his part of the country, at least
even to get it off the drawing board.
When you import things into your country,
you are importing poverty, exporting jobs out.
So we have to stop it.
Aliko's investment in refinery, if it goes well,
it should encourage both Nigerians and non-Nigerians
to invest in Nigeria.
I think that the biggest impact is perhaps the most subtle one,
which is that all of Nigeria's huge entrepreneurial educative
energies go into basically an arbitrage
play, buying and selling crude and refined products.
And if they turn their attention to something else that
is productive, that creates jobs in Nigeria, that
pays more taxes in Nigeria, then of course,
the Nigerian economy will benefit hugely.
So Aliko Dangote is Nigeria's richest businessman.
Nigeria's foremost industrialist.
He made his fortune on producing simple things.
He is a pioneer in the cement manufacturing industry.
And now he's moved into refining oil.
Depending on who you ask, he is the greatest businessman
that Africa, certainly that Nigeria, has ever produced.
Thousands of jobs depend on him.
He's the biggest taxpayer in Nigeria.
And he's broken this curse of Nigeria importing everything.
To his detractors, he's a man who's
manipulated the government.
He's a monopolist.
He's rigged the system so that he doesn't have to compete.
When the FT interviewed him last year,
he was at pains to say that this was the wrong characterisation,
that he is someone who has built his business from the ground up.
But I think whatever you think of him he
is the most important business person working in Nigeria today.
Dangote thinks the refinery will reach 85 per cent capacity
by the end of this year.
Most people would tell you that that's very optimistic.
In December of 2023, the Dangote Refinery took delivery of its
first 6mn barrels of crude and started test producing aviation
fuel and diesel.
But it's struggled to get a hold of the crude supplies it
needs to ramp up production.
And so it has turned to suppliers in far flung places
like Brazil and the United States.
Dangote has been at odds with the NNPC, short for the Nigerian
National Petroleum Corporation.
He says they haven't delivered all the crude
they were supposed to.
And their stake in the project has now been watered down
to 7.2 per cent.
He has mused openly about walking away from this $20bn
refinery.
But we've spoken to people in his camp
who say this was just him letting out his frustration
and that should not be taken too seriously.
If those who are selling or supplying
refined products for Nigeria feel
that they will lose the lucrative opportunity,
they will also make every effort to get him frustrated.
A lot of people who have been making a very good living based
on the kind of pickings from this trade,
theoretically, much of that could disappear.
So clearly, there's going to be a whole class of people who
do not want this to succeed.
You expect them to fight through non-supply of crude,
non-purchase of the product.
But I think it's all temporary.
We'll get there.
I knew that there will be a fight.
But I didn't know that the mafia in oil,
they are stronger than mafia in drugs.
The fuel subsidy is gone.
For years, fuel subsidies have kept
fuel prices artificially low.
And one of the first acts of this government
was to remove the fuel subsidies.
So the day that we heard that the government was
removing fuel subsidies, that day, we had a crisis.
Riders couldn't get fuel.
Filling stations actually stopped selling fuel.
And some increased their prices.
So there was a kind of panic.
Since yesterday morning, we have been here.
Chowdeck is an on-demand delivery platform for Africa.
We are currently live in eight cities in Nigeria today.
As at last week, we do about 20,000 deliveries every day now.
Sometimes I use a bicycle for my work.
Sometimes I use a scooter, depending
on which one is available to me for the time
as well as availability of fuel.
We are now investing heavily in hiring more riders that
have bicycles, partnering with e-bike companies,
and just ensuring that we have non-fuel-based means
of delivering orders for our customers.
If delivery prices are increased too much,
it might turn off people that use the service.
They might not want to buy.
So that means you using the fuel,
you're the one that has to spend more.
How long?
How long?
We deliver food from restaurants and medicines
from pharmacies, groceries from supermarkets.
People started like ordering for these things on Chowdeck
because it was actually cheaper to transport
those things from the market to their house
than them entering bus or public transport to go deliver
those items.
On a typical day on Chowdeck, I can do 10 orders, sometimes 12.
I can make within 8,000 [naira] to 10,000.
And I've seen a day when I made like up to 12,000.
There's always crises to fight every time as a business owner.
So I think that's the excitement of trying
to build a company in Nigeria.
I'm not excited about the crises.
I hope crises don't happen.
But when they happen, it just gives us
a chance to be resilient and just solve problems
as they come.
Yes.
I think that we are at a turning point.
Two hugely important things have changed, refining and subsidy.
Fuel subsidies are part of the national psyche in Nigeria.
I think people regard them as the only benefit they've
gotten from their oil-rich rich country.
But this is also a very expensive policy
because it means that, as the oil price goes up
internationally, the amount that you have to subsidise petrol
also goes up.
The NNPC is a state-owned corporation,
although two years ago, they said they are now
a private limited corporation.
If you want to do an offshore deal,
you need to do business with NNPC.
If you want to do an onshore deal,
you need to do business with NNPC.
The NNPC is the state agency responsible for paying the fuel
subsidies.
And that means that oftentimes they
don't have enough money left to pay back
into the government account.
So you've had this absurd situation
that as the oil price spiked, NNPC was literally handing
over zero to the Treasury.
Obviously, there's very little money
left for revamping its own pipelines
or its own infrastructure, which contributes
to the inability of the country to meet its Opec targets.
But also, in terms of little money
left to invest in trying to revamp the refineries as well.
When the fuel subsidies got to a peak of about $10bn in 2022,
there was a sense that Nigeria could no longer afford this,
especially because it felt like the government was paying these
huge sums at the detriment of other sectors,
including health and education, that have very poor outcomes
in Nigeria.
When Bola Tinubu came in, in his inaugural speech,
he said almost offhandedly, subsidy is gone.
Fuel prices skyrocketed.
The cost of fuel has obviously driven people into poverty
because Nigeria relies on fuel for not just power
generation, but also moving goods and services and moving
people as well from one part of the country to another.
You and I and I,
It was perfect timing.
My name is Aramide.
I am a singer, songwriter, and guitarist.
I've been doing music for quite a while.
It's my happy place.
And we fantasise, I realise.
I sing a lot about love and life.
It takes them away from what the real problems
are: inflation, no lights.
Everything is expensive.
Like, it's depressing enough.
If you were filling your tank with 20,000 naira before,
now you're filling your tank with close to 60,000 naira.
The moment we have been waiting for, Aramide.
How much do you have to hustle?
You have to hustle hard.
So I think that most people, before they
decide to come for an event, they try to prioritise.
They're like, OK, do I really have to be there?
Video directors are charging more.
Music producers are charging more.
Band people are charging more.
Like, everything that happens in the economy,
it's a ripple effect.
It's expensive to promote music.
It's expensive to put yourself out there now.
Things seem anxious and uncertain.
I understand the hardship you face.
I wish there were other ways.
But there's not.
You could argue, and I think most economists would argue,
that the subsidy was hugely distortionary to the Nigerian
economy, distortionary and expensive and really
needed to go.
But the way it was done was really shock therapy overnight.
What hardship can they cause people?
How are you going to ameliorate that?
There's a lot of work that needed to be done.
Not just wake up one morning and say you remove subsidy.
The purpose of removing fuel subsidy in Nigeria
was to allow the free hand of the market
to decide how much petrol would cost per litre.
But what we're seeing right now is that there's still
some government intervention.
The cost of petrol should be more than what it currently
costs right now.
Because of inflation, the subsidy that we have removed
is not gone.
It has come back.
Some of the major problems with the discovery of oil in Nigeria
have come from host communities in the delta
who have often asked what oil has
done for them as a community.
A very famous protagonist was Ken Saro-Wiwa,
who protested specifically against Shell,
and who said we are suffering from pollution.
Meanwhile, our kids are not going to school.
Our other industries are a wreck.
And we want a redress.
Unfortunately, this happened under a military government
who hanged him.
In the mid-2000s as well we saw a movement
called the Movement for the Emancipation of the Niger Delta
(MEND) that also began agitating for better conditions for people
in the delta.
And this led to attacks on oil installations.
Oil workers were kidnapped.
Here's my name, my name is high chief Solomon
Ndigbara, 'When the chief steps out people run away',
of Ogoniland.
In our own area, there was no kidnapping.
We can vandalise the pipeline, blow up the pipeline.
Any government activity, we would obstruct them from doing.
My fight was that government should know that we own the oil.
They killed one of our heroes, Ken Saro-Wiwa.
And that made me join [the movement].
He said that no, you cannot come to our place and collect oil
without giving us a good school and good water.
He talked in peace.
Nobody listened to him.
The next thing they do is to kill him.
In my place, until now, the government
has not been able to collect our oil.
The reason why we marched today is that we want to let people
know there is a plan to collect oil from Ogoni.
Those selfish politicians, they want to stay in Abuja,
decide the companies that will come to Ogoni and take oil.
And we say, no.
This picture you see, is just when I came out from the creek.
So eventually, the government of the day in 2009
reached an amnesty deal that saw a lot of fighters
drop their arms in exchange for money
and for the government setting up a commission
to address the concerns that the agitators were bringing
to the table at the time.
There are leaders of that movement
who are now politicians.
One of them last year got a contract
to help the Nigerian government prevent attacks
on oil installations.
Sometimes they say amnesty is working.
No.
Some of the people that participated in the struggle
never got anything.
But when you tell [the people], let us make peace,
then tomorrow, they have something doing.
They will continue [with] the peace.
Nigeria is the type of country where you can pay bribes.
If they see God, they go and bribe God.
When I see that the all the things the federal government
said they would do for me, they did not do any of them,
I decided to open a mill where I do [palm] oil,
so that I can train my children and do other things.
See, over here is the palm fruit.
That's what I did.
Nigeria politically is a complicated country anyway.
You could argue that it was sort of cobbled together
under British colonialism.
So there's not necessarily this inbuilt sense of national unity.
So if you have nine states where the oil is concentrated,
it's quite natural for those states to say, well, hang on.
Isn't this ours?
And yet, what happens in the Nigerian political economy is
basically, the money from oil goes
to the federal government now based
in Abuja, who then redistribute.
Now, some of it goes preferentially back
to those nine states.
But there's huge dissent.
My name is Fyneface Dumnamene, Fyneface.
I work as a human rights defender, and of course,
an environmental activist.
Where I'm seated now, if you look behind me,
you will see massive environmental pollution.
The people have been denied of their traditional means
of livelihood.
But some time ago in this Bolo community,
it was a place that you can see houses very close to the water.
You can put your pot on the fire cooking.
And you come to the back of your house, you throw your net.
And you can catch fish to put in the same pot that
is on the fire.
The entire water body is now dead.
And there is a need for both local and international
attention to be drawn to this so that this place can
be cleaned up and the people can have their livelihoods restored.
Multinational oil companies, they
are contributing to environmental pollution
in the Niger Delta.
We also have the role being played
by a new generation of polluters,
the artisanal crude oil refiners.
It's a very big process that employs more people
than some state governments in Nigeria.
They vandalise the pipelines and they get the crude oil.
And the youths don't believe that they steal the crude oil.
They believe that they collect the crude oil
because they said it is their God-given resources that is
under their soil in their land.
At least the survival of human beings first before environment.
Kpo-fire is the local language.
But it's where we go to a site and tamper with the pipes,
break the pipes and get crude to survive.
I have worked with the artisanal refinery for 11 years now.
I have more than 60 workers, more than six-seven camps.
I have people that cook for them at the camp.
Altogether, I have about eight speedboat drivers.
When the product arrives, some cook the product at night.
Those ones, they boil it special.
Then I have also the section that sells.
By the grace of God, that is what
I've been doing, because I have no job.
This is the product I'm talking about.
You can use it for car or generator.
This is about 3,000 naira, $2.
dollar.
To tell you the truth, sir, it's dangerous.
But if you want to get money, in fact, in Nigeria,
you must struggle before you eat.
I have had incidents like two or three times, fire incidents.
Four people killed, some got injured.
Even when there were deaths, [other] people
are still rushing to work.
Where there is money, there is always danger.
Majority of community people support
what they are doing because it makes them
to have DPK, which is kerosene.
The Nigerian government is unable to produce the kerosene
from any of its refineries.
Ask a community member, can you show me an artisanal refinery
in this community?
They will tell you there's nowhere
that it exists in the community.
That is because they are benefiting from the activities
and it's contributing to the development
of the local economy.
And these sites are also owned, allegedly,
in partnership and collaboration with politicians,
in partnership and collaboration with security operatives
that operate in the Niger Delta.
They all share according to their investment
into the process.
So it is an organised crime process.
For years now, Nigeria has not been
able to meet its Opec quota.
A lot of it is because that oil is stolen.
And you cannot talk of boosting the economy when you are turning
a blind eye at the issue of security.
Even if I stop, what about the rest behind me?
It is from me they are feeding.
Even as a boss, I've been arrested once.
My workers, they have arrested them several times.
But I know how to get them out.
At least through negotiation, they will come out.
And the work will keep on flowing on.
Illegal refineries are not a victimless crime.
They contribute to existing environmental damages.
There's a problem of black soot, which
means that the air quality in Port Harcourt is not very good.
You can feel the soot literally on your hands.
Yeah, definitely, the work we are doing is dangerous.
I have been attacked six times.
Just last year, about nine boys came out of the bush
and started shooting at me.
In reverse gear.
We have to continue from where our forbearers stopped.
Like Ken Saro-Wiwa is from my area.
So no matter the threat we face, we
continue to speak for us to have a better environment that
supports the life of the people.
There are huge problems, reputational, logistical,
criminal, and regulatory around these onshore wells.
As the big oil majors pull out, local companies
who either believe that they can or indeed are
more able to negotiate some of these problems are moving in.
Empowering Africa.
My name is Osa Igiehon.
I'm the chief executive officer of Heirs Energies Limited,
the operator of [oil block] OML 17.
We operate about 5 per cent of Nigeria's oil production
and roughly about another 5 per cent of Nigeria's gas production
into the domestic market.
Whilst we hear the global narrative of energy transition,
which talks about moving from predominantly one source
of energy to another source of energy, in Nigeria
there is a big transition also going on,
not about energy sources, but particularly
with onshore with IOCs, international oil companies,
leaving and being replaced by indigenous oil companies.
It is posited that by the end of the decade
most of the international oil companies
would no longer be active onshore,
and they will now be indigenous oil companies.
We're at 5,000.
We need to go to 7,000.
We need a few things.
So Africapitalism positions private sector
in the lead of making investments to improve lives,
making substantial prosperity and, at the same time,
creating social wealth.
It talks about profits.
And it talks about impact.
The country should be in the position to produce 2mn to 2.5mn
barrels of oil per day.
Today, we are only able to produce somewhere in the range
of 1.2mn to 1.5mn barrels of oil per day.
There are a number of causative factors,
but the biggest is the theft.
The second challenge is then the point of investment.
Because of the theft, it has created a scenario
where there has been a stifling of investment in the sector.
Thirdly, there is a global push for energy transition
that has made getting financing for oil and gas
more challenging.
We took over operational control from the previous operator
in July of 2021.
We essentially doubled our oil production in the hundred days
from 27,000 barrels to 52,000 barrels of oil per day.
But we noticed very quickly that whilst we
are trying to ramp up production, what was getting
to the terminal was declining.
In December of 2021, we only got 3 per cent of our production
at the terminal.
Today, we now get an average of 85 per cent of our production.
So lots of appreciation to the government for these steps
and very decisive steps they have taken and sustained
to secure the pipeline.
Nigeria is usually the biggest producer in Africa,
it produces anywhere from between 1.3mn to 1.5mn barrels
of oil a day.
It's a member of the Opec+ cartel.
And it's one of the top 15 producers of oil globally.
The easiest thing for the government to do
is really cream off oil wealth.
And that is what it's relied on for decades.
And so it has this outsized role in the Nigerian economy,
both in terms of the foreign currency that it generates,
because that is basically the sum of Nigerian exports,
and in terms of the government revenue, oil is really king.
The Nigerian government doesn't collect that much tax.
That means that the government focuses lots of its energy
on making sure that the oil keeps flowing
and the oil keeps pumping.
In terms of GDP, it's not as big as people imagine.
There's lots of other stuff going on in Nigeria.
It has a very big banking industry, insurance.
There's a lot of entrepreneurs.
It has a big tech industry.
The question that a vast majority of Nigerians
ask themselves is: has the oil wealth
being used for the greater good of all of Nigerians?
And I think the overwhelming answer would be no.
The oil wealth has not trickled down
to the most vulnerable in Nigerian society.
Our youth are restive.
And they are restive because they have no skill.
They have no empowerment.
They have no employment.
We are all sitting on a keg of gunpowder.
And my prayer is that we will do the right thing
before it's too late.
Oil has been a blessing to Nigeria.
It could have been more of a blessing, yes.
And it can be a bigger blessing for the future.
Our people, our diversity, our dynamism, our resilience,
our capacity to confront challenges and surmount them.
Personally, I feel that oil has been more of a curse
than a blessing.
You have a natural resource that takes over the national psyche
so much that it's kind of led to a lack of imagination.
2mn barrels of oil is not enough to make 200mn people rich.
So what you get is you get a scramble.
There must be investor confidence created.
You have to go from transactional economy
to transformational economy.
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