SERAP releases survey findings on transparency, accountability in management of oil and gas resources in Niger Delta

A leading advocacy group in Nigeria, Socio-Economic Rights and Accountability Project (SERAP), at a stakeholders’ interactive session in Lagos, released the organisation’s findings on a research on

“Strengthening Transparency and Accountability in The management of Oil and Gas Resources in the Niger Delta Through Community Empowerment”.

The research was conducted and presented by Olubunmi Afinowi, Ph.D, on behalf of SERAP. National Daily Newspaper covered the interactive session in Lagos.

According to Afinowi, the report was based on the backdrop of the Right to a clean and Healthy environment.

She identified the right to a clean and healthy environment to include:

• Enjoyment of the highest attainable standard of physical and mental health.
• An adequate standard of living, adequate food, housing, safe drinking water and sanitation.
• Right to Participation in social and cultural life, for present and future generations.

The research indicated that the Niger Delta situation represents one of “Water, water everywhere, not  a drop to drink.”

The research observed that despite the wealth the Niger Delta holds, and provides for the entire nation, the region  remains deeply in the grip of squalor, poverty, and environmental degradation.

According to Afinowi, the Niger Delta situation presents a complete contrast to the contents of the ‘right to a clean, safe and healthy environment.’

She disclosed that the Report examined, through an empirical study:

• The economic activities conducted in the Niger Delta region
• The economic, social and environmental effects of these activities on the people of the region.
• How the Government responds to the social, economic and environmental injustices in the region.
• The remediation and reparation by the oil companies within the region,
•  and the level of transparency and accountability by the government and the agencies as well as Oil Companies. On Conceptualization,
• The study focused on the activities of Oil and gas companies in the Niger Delta region
• Specifically, the Upstream sector where the exploration and production of crude oil takes place.
  Afinowi,  highlighting the Oil and Gas Sector in the Nigerian economy, stated that –
•  The oil and gas sector has been an economic mainstay for the entire nation.
• As of 2020, the country had apparently 18 opetrational pipelines operated by various International Oil Companies (IOCs) producing about 1.8 million barrels of crude oil per day.
• In 2021, due to the COVID-19 pandemic,    the country recorded 1.7 million barrels per day of production.
• In all, Nigeria has crude oil and natural gas reserves of about 36.9 billion barrels and 203.1 trillion cubic feet, making it a leading producer and exporter of oil and gas in Africa.
• The oil and gas sector accounts for about 9% of Nigeria’s GDP, and about 90% of its export value.

In the year 2019, earnings from the sector contributed to about 65% of the government’s revenue.

Afinowi also identified the Niger Delta -Home to Upstream Sector, highlighting that the present day Niger Delta Region of Nigeria comprises nine states – Ondo, Edo, Delta, Bayelsa, Rivers, Akwa Ibom, Cross River, Abia and Imo. She noted that the nine states have 185 local governments and over 800 oil-producing communities and about 900 oil-producing wells.

The report indicated that the Niger Delta region had a population of approximately 43 million people as of 2016, according to information from the National Bureau of Statistics, noting that Rivers State is the most populated and Bayelsa the least populated state.

Identifying the Key Players, Afinowi stated that the Upstream subsector has a plethora of players spanning international corporations to national and sub-national state and non-state actors.

She added that the government, through various agencies and departments, plays the role of regulator and partner in oil and gas production in Nigeria.
Afinowi identified the regulators as:
the newly created Upstream Regulation Commission which has the core duty of regulating the upstream activities and advising on the granting of exploration, prospecting and mining licences.

• The Department of Petroleum which performed the main regulatory and monitoring duties together with the responsibility of collection of royalties and collation of data for the computation of the petroleum profit tax.
• The Nigeria National Petroleum Corporation (NNPC), which was until its privatisation, both a regulator and an investor in Upstream activities.
• The Niger Delta Development Commission (NDDC) which is tasked with the duty of sustainably resolving the socio-economic challenges experienced in the Niger Delta region as a result of the activities of the oil and gas industry in the region.

She maintained that the IOCs dominate the oil and gas industry with the key players holding about 80% of extraction and production. These companies, according to Afinowi, include Royal Dutch Shell PLC, Chevron Corporation, ExxonMobil Corporation, TotalEnerges SE, Agip and others.

Afinowi added that the host communities are major stakeholders in the oil and gas sector, particularly, the upstream subsector.

She asserted that their interest is primarily marked by the fact that the oil and gas extractive industry is situated within their local communities, and they must continually endure adverse impacts, including gross economic deprivation, infrastructural neglect and environmental degradation.

Afinowi also identified the Regulatory Framework to include:

The Petroleum Industry Act of 2021 (PIA) which oversees the governance and regulations of the oil and gas sector in Nigeria and makes provisions for the development of host communities where the activities are carried out.
She added that it created the Nigerian Upstream Petroleum regulatory Commission (NURC), which has the duty to regulate upstream operations and ensure compliance with all applicable laws and regulations in the sub-sector.

Afinowi said that under the PIA, the NURC takes over the functions and duties of the DPR.

The report acknowledged that the PIA included a chapter on host community development with the aim of

• Fostering sustainable prosperity within host communities.
• Providing direct social and economic benefits from petroleum operations to the host communities.
• Enhancing peaceful and harmonious coexistence between licensee and host communities, and
• Creating a framework to support the development  of host communities.

The study further reflected on the Oil and Gas Industry in the Niger Delta as typifying “A Case Study paradoxes”.

Afinowi argued that while the region is rich in natural resources and biodiversity and is the economic mainstay of the entire country, the host communities continue to experience a plethora of adverse impacts.

These impacts, she said,  have been classified into negative economic, social, political, security and environmental impacts.

The report stated that about three-thirds of the population of Baylesa depend on either fishing or farming, noting that due to the high rate of oil spillages, and land and water contamination, the people are having to turn to other means of survival.

Afinowi observed that environmental degradation has led to massive rural-urban migration, as the younger population are found to leave their communities in search of a means of survival in the cities.

The report further revealed that the region is vulnerable to the adverse effects of climate change due to geographical and social vulnerabilities.

“There is a high susceptibility to coastal inundation and erosion, sanitation of fresh water, river flooding, storm surges, migration of species and so on.

“These impacts have the likelihood of exacerbating existing socio-economic and environmental challenges as well as creating new ones,” Afinowi declared.

She said that there is also the challenge of Insecurity due to agitations for better living conditions, long term neglect and disregard of the region by both the government and the IOCs.

“These agitations led to the springing up of various interest groups, some of which had to resort to various forms of violence to drive home their agitations,” she said.

Afinowi noted that the state of insecurity continues to hamper infrasturctural economic development within the area.

“Research by the Stakeholder Democratic Network shows that one in 20 households experienced bereavement as a result of conflicts in the region between 2010 and 2017,” she noted.

The report cited: According to Obiam and Amadi,

“The Niger Delta region is characterised by a general state of underdevelopment, underemployment, excessive poverty, and a lack of competent and suitable infrastructure. The rural areas of the region are characterised by failed and abandoned development projects aimed at improving people’s material living situations; but economic and social rights, such as the right to an adequate standard of living, remain unmet. Administrative neglect, deteriorating social infrastructure and services, high unemployment, social deprivation, abject poverty, filth and squalor, and endemic war are all… problems in the region. The majority of the region’s residents lack appropriate access to clean water and healthcare services. Their poverty, in contrast to the wealth generated by oil, is a classic illustration of poverty in the face of abundance. ”

Afinowi also identified Specific Development Challenges in the Niger Delta to include:

• Unemployment
• Lack of access to water and hygiene
• Lack of healthcare facilities
• Insufficient roads and transportation infrastructure.

The report revealed that participants for the study were drawn from four major groups – and these include members of the community, government agencies and departments, civil society organizations (CSOs) working with the Niger Delta region, and oil and gas companies operating in the region.

At the interactive session where the report was presented by Olubunmi Afinowi, Ph.D, on behalf of SERAP, at the Banquet Hall, Sheraton Hotels, Lagos, participants included members of Nigerian Guild of Editors (NGE), stakeholders, including traditional rulers from the Niger Delta, media organisations, CSOs, among others.