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Nigeria loses N63.778 trillion to oil production
15 May, 2018

Over $177.136 billion (N63.778 trillion) has been lost to the halt in crude oil production from 96 oil wells in Ogoni land in the last 25 years.

The Shell Petroleum Development Company (SPDC) started operations in Ogoni land in Rivers State in 1958, drilling a total of 96 wells to bring nine oil fields on stream.

By the end of 1992, Ogoni production was some 28,000 barrels of oil a day, about three per cent of SPDC’s total production, but SPDC stopped production in Ogoni land and withdrew from the area in 1993 after violence against its staff and action targeting the company’s facilities due to massive crude oil production, which destroyed the communities’ rivers and farmlands.

Prior to the crises in the Niger Delta communities, SPDC had produced 28,000 barrels per day (bpd), which amounted to 102,2000,000 barrels in one year.

At the current Brent crude oil price of $69.34 per barrel, the country has lost an average of $7.01 billion in one year and a total of $177.136 billion in the last 25 years.

Although SPDC has produced no oil or gas from Ogoni fields since 1993, Ogoni land continues to serve as a transit route for pipelines transporting both SPDC and third-party oil production from other areas.

The Movement for Survival of Ogoni People (MOSOP) was established in 1990 and began campaigning for greater control over oil and gas resources on their land, for economic development, and autonomy over their affairs, (including cultural, religious and environmental matters). MOSOP’s demands were summarised in their 1990 ‘Ogoni Bill of Rights’, which were mostly of a political nature and addressed to the Nigerian government.

By November 1992, MOSOP was also demanding $6 billion in royalties from past oil production and $4 billion for alleged environmental damage, and SPDC was given 30 days to accept or leave Ogoni land.

Despite the loses incurred by the country through non-oil production in Ogoni land, activists in Niger Delta have continued to caution the Federal Government and oil companies against the resumption of oil production in the Niger Delta communities.

MOSOP President, Chief Legborsi Saro Pyagbara, has insisted that crude oil production will not be allowed in Ogoni land until the Federal Government and the oil companies carry out the necessary clean up in the communities polluted by massive oil spills.

Former President of the Movement for the Survival of the Ogoni People (MOSOP), Ledum Mitee, said that any resumption of oil production activities without credible cleanup of the polluted environment would be tantamount to profound insensitivity to the plight of Ogoni people.

Mitee stated that while Ogoni people are still battling with the non-implementation of the United Nations Environment Programme (UNEP) report, they are now being confronted with plots by the Federal Government to resume oil exploitation in Ogoni through some firms of doubtful pedigree and credibility without the needed painstaking engagement with the long-suffering Ogoni people.

Speaking on its relationship with the communities in Ogoni land, SPDC has publicly called for reconciliation among Ogonis and between the Ogonis and SPDC and continues its SPDC’s community development programme in the area despite the fact it is no longer an oil producing area.

Responding to the allegation by the communities and Amnesty International report on its slow response to oil spill, SPDC’s General Manager, External Relations, Igo Weli, said that the company regularly test emergency spill response procedures and capability to ensure staff and contractors can respond rapidly to an incident.

However, he noted that response to spills, cleanup and remediation depend on access to the spill site and ultimately on the security of personnel and equipment while work is ongoing.

Weli said the transparency in the online reporting of spill incidents by SPDC in its areas of since 2011, which Amnesty International itself acknowledged, demonstrates its commitment to creating awareness and enhancing collaboration with key stakeholders on oil spill response and cleanup processes and deepening understanding of the complex and challenging operating environment.

“SPDC reiterates its commitment to carrying out operations in line with best practice in a responsible and environment-friendly manner,” he added.

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