CRUDE OIL AS A BLESSING AND A CURSE FOR THE NATION
When crude oil was discovered in 1956 at Oloibiri in the Niger Delta area, there were expectations of gradual depletion of poverty, and economic buoyancy in Nigeria.
Crude oil, often referred to as the black gold, has stood by Nigeria in hard times, acting as a pillar during economic instability. Many have argued that without oil, the country will be handicapped and will not forge ahead, while some upheld that ‘oil’ is an enemy of progress.
In 1988, Gelb said crude has become the backbone of the country’s economy after 1960, and according to Ogbeifun (2008), oil and gas dominated about 90% of Nigeria’s foreign exchange earnings and 83% of its Gross Domestic Products. Similarly, Adewumi and Adenugba shared in 2010 that Nigeria was among the world’s largest producers of crude oil, the 10th largest producer and the 6th largest exporter among Organisation of Petroleum Exporting Countries, OPEC.
Indeed, this is a great development, but how has it translated to the benefits of the masses? How has the discovery of crude oil improved the quality of Nigerians’ lives? The answers are not far-fetched – the truth is conveyed in the impacts of crude oil in Nigeria.
Recall that before 1960, agriculture was the mainstay of Nigeria’s economy (Federal Research Division, Library of Congress, 1991) with a GDP growth rate of 4.40USD, contributing over 65% of the total output and employing more than 60% of the total labour force, Metz and Helen, 1992 have this in record.
But when Nigeria experienced crude oil boom after the civil war in 1970, especially when production level hit 2 million barrels per day, it caused more ripples in Nigerians’ minds as they began to push agriculture behind the scene and welcome the new ‘visitor’ in full arms – its repercussions are still evident today.
Vanguard stated on December 7, 2018 that Nigeria’s economy was stable with agricultural produces between 1950s and 1970s. It also revealed that the crude oil discovery was a straw that broke the camel’s back in the nation. Nigeria depended so much on it, watching her agricultural productivity decline to 34% in 1988.
The exclusive concentration of the economy on crude oil did not only lead to a massive migration of people from the rural areas to cities in search of white-collar jobs where oil facilities are located, but also resulted in the transfer of the labour force from agricultural activities to industrial activities. The effect is that the number of applicants exceed the job vacancies available in the cities, thus, increasing the rate of unemployment.
Significantly, the economic growth of the country is subjected to the price of crude oil in the international market since it dominates its foreign exchange earnings. If the oil price crashes, the economy also follows suit, a reason some have associated with Nigeria’s rank among the poorest countries in the world.
Undoubtedly, oil has brought fame and dignity to the land, but despite the billions of dollars being transacted in the oil and gas sector on a regular basis, the industry is not self-sufficient talk less of catering adequately for the country and its people.
The refineries have been functioning below expectation. The economy has also been crumbling; cost of living has skyrocketed to an unbearable level. Prices of food items are continuously being inflated, with unemployment rate drastically increasing every year. Many farmers have been rendered jobless because their farmlands have been contaminated by oil spills. The fishermen equally suffer same fate, lamenting the destruction of their rivers and livelihood.
A large number of the masses are suffering: “We saw people drinking water from the same place where they are bathing, where they are defecating and where they are doing all sorts of domestic chores.” A Nigerian Senator Falorin shared this experience in 2007 in the Punch newspaper after a tour to an oil spill site in Ikot Ada Udo Village, an oil-producing community in Akwa Ibom state.
In October 2018, the Executive Secretary of the Nigerian Content Development and Monitoring Board, Engineer Simbi Wabote, said in This Day, that Nigeria supplied other countries gas that was enough to power their homes and industries, whereas it lives in darkness. He said: “We have heard for decades that Nigeria is a gas province with pockets of oil. We have 180 trillion cubic feet of gas reserves which is considered the largest in Africa and the 9th largest in the world.
“Our gas reserves are more than double that of Canada and five times that of Netherlands. But electricity generation in Netherlands is five times more than that of Nigeria while Canada generates 20 times more than what we currently churn out".
The cataclysmic effect of oil discovery in Nigeria is not limited to the above alone. It has also resulted in loss of lives.
For instance, communities where the black gold has been cited or where oil pipelines run through or where oil depots are located cannot sleep with their eyes fully closed. The fear of pipeline explosion pervades such communities.
Last year October, about 200 residents died in the Osisioma fuel pipeline explosion in Aba, Abia State. The youths, numbering 2,000, later barricaded the gate of the depot with a coffin containing the corpse of one of the victims, lamented that the pipeline explosion was caused by NNPC’s negligence – conveying petroleum products through faulty pipelines which had been abandoned for over three years.
From the ongoing, it is obvious that oil is characterised with environmental destruction, economic instability, increased unemployment rate, mass suffering, loss of lives among others, nevertheless, its discovery remains pivotal and more of a blessing than a curse, considering the economic roles it plays in the country.
In conclusion, poor management of these resources is the reason for this curse, although if there was no oil discovery, nobody might be talking about the management.