Foreign oil companies in Nigeria Considering to move off shore
By Paul Ndiho
A wave of planned sales of onshore Nigerian assets by major oil companies has prompted speculation among some industry insiders that the firms are finally leaving the Niger Delta because of oil theft and political uncertainty. But other industry sources say the companies are staying.
Environmentalists living in Nigeria’s oil producing regions are pushing for a clean-up recommended by the u-n two years ago that said oil companies and the government were responsible for 50 years of oil pollution. Lawyer Chima Williams says communities in oil producing areas would fight any pull out by oil companies, if they attempt to leave before cleaning up.
“The number one thing for the companies to do is to clean up their mess, clean up the environment that they have destroyed before they now begin to consider selling off their facilities. So if they think they can run away by selling off those facilities instead of doing what they have been asked to do in the UNEP recommendations, then the next job goes to the community people to begin to go to court and seek for orders restraining the companies from selling of these facilities until the needful has been done.”
Oil theft, officially estimated at 250,000 barrels per day, is a massive criminal enterprise. Although it’s often associated with criminal gangs who tap crude from pipelines for local refining– most stolen crude leaves the country in large tankers, which could not happen without the complicity of top officials.
“What is happening is that those assets that are not economically rewarding are being sold off in the portfolio to indigenous other prospects. Basically, this is in reaction to a couple of things, one, the PIB has not been passed and a lot of people are having second thoughts about investing new money until the resources become…. until the laws become very clear and definite.”
Shell C.E.O Peter Voser nevertheless told voice of America the company was not seeking to leave Nigeria.
“But the whole sabotage issue and therefore the stealing of product, but also the environmental devastation needs to be tackled and it can only be tackled by the Nigerian government leading it, by all the industry players in it, the communities. So we are committed to Nigeria but we need to sort out some of the issues together with others.”
Energy majors are increasingly moving towards gas production instead of oil. The global shale oil and gas boom means there are more exploration opportunities, so it makes financial sense to keep only the most profitable businesses in Nigeria, like gas for export, and expand deep offshore where oil theft is highly unlikely.
“What is happening is that those assets that are not economically rewarding are being sold off in the portfolio to indigenous other prospects. Basically, this is in reaction to a couple of things, one, the pib has not been passed and a lot of people are having second thoughts about investing new money until the resources become…. until the laws become very clear and definite.”
A 2011 landmark u-n report slammed multinational oil companies, particularly shell, and the Nigerian government, for 50 years of oil pollution that has devastated the Niger delta’s fragile wetlands. Shell and the government swiftly pledged to act on the report’s findings. Militancy in the Niger delta over the last decade shut down nearly half of Nigeria’s oil output, until a 2009 amnesty. Oil analysts say the risk of renewed unrest, and the growing risk of financial liabilities from various court cases might ultimately be what spurs action from the government– and the oil majors to finally begin the clean-up.