In July 2017, members of an oil exploration crew working for the Nigerian National Petroleum Corporation, NNPC, were ambushed and abducted by Boko Haram armed insurgents near Jibi Village in Gubio Local Government Area of Borno State.
At least 27 people died in the attack after rescue efforts by soldiers and members of the Civilian Joint Task Force, CJTF. The victims, who included soldiers, staff of University of Maiduguri, engineers and some personnel of the Civilian Joint Task Force, CJTF, were ambushed while on an oil exploration mission in Lake Chad.
The Nigerian government, in its reaction, halted exploration in the region.
In September, few months after the attack, the NNPC announced its resolve to commission another team to handle a similar mission in the Sokoto basin.
The move is believed to be part of President Muhammadu Buhari’s directive to the NNPC on resumption of oil expedition and gas exploration activities in the inland frontier basins of Northern Nigeria, especially the Chad Basin and the Kolmani River in the Benue Trough.
Earlier in July 2016, the Group Managing Director, GMD, of the NNPC, Maikanti Baru, had disclosed the president’s plan for the frontier basin in the Chad and some area close to the Kolmani River (Bauchi State) where Shell had made some indicative discovery of hydrocarbons.
“Mr President has directed me to go into that area to improve and further explore the magnitude and prospectivity of those finds,” Mr. Baru had said.
The decision to continue with the oil exploration in the region has thrown up arguments among Nigerians, with analysts divided on the plausibility of the government’s and NNPC’s decision.
Dauda Garuba, an oil and gas expert and civil society advocacy campaigner, said there was nothing ordinarily wrong with the continuous search for oil in the Chad basin. He, however, expressed concerns about the future of the nation without oil.
“I personally do not see anything wrong with exploring for oil anywhere in the country – North or South,” he told PREMIUM TIMES in an interview.
“Those opposed to it have either argued from the point of view of competition with the Niger Delta region or from the point of falling oil prices. I look at it from the point of view of balancing sources of revenue as against overstressing one region.
“The argument about low oil prices does not hold water. Experiences have shown that oil reserves are better grown during periods of low prices to prepare for a future of high prices. Saudi Arabia has had this. Alaska in the US also had same experience. Nigeria’s offshore oil was developed during the same difficult times in the early 1990s.
“This is the right time to use incentives to develop more reserves that will deliver the revenue during the period of high prices. Commodity markets generally is often imbued with periods of low and high prices. What should bother us is the likely fate of oil in the nearest future.”
But other analysts are of the opinion that the search is a shortsighted initiative that does not put into consideration the bleak future of oil resources.
Auwal Rasfanjani, Executive Director, Civil Society Legislative Advocacy Centre, CISLAC, said the initiative is symptomatic of Nigerian leaders’ misplaced priority.
Speaking in an interview with PREMIUM TIMES, he said, “Nigerian leaders rarely think of the future and that is why we are fixated on oil in the Lake Chad basin. The project even has not been seen as a national effort to diversify government revenue. There are signs that it is more about politics than efforts to increase our oil revenue.”
Mr. Rasfanjani also said that the manner the government is pushing the idea shows it might not be for pure economic reasons but to also achieve some ethno-political objectives.
The CISLAC boss said it was disturbing that Nigeria is searching for oil at a time when the world is moving away from oil to renewable energy sources.
A report by the Centre for Social Justice, CSJ, a civil society organisation, said commercial crude oil exploration in Nigeria and the rest of the world would become unprofitable within the next 13 years.
The report, published in August, also projected that within the next four to five years, the price of crude oil would further reduce to about half of its current value.
Speaking in a chat with PREMIUM TIMES, Executive Secretary of the CSJ, Eze Onyekpere, expressed worry over Nigerian government’s continued search for oil in the Lake Chad basin.
He explained that in few years, it may become unprofitable for companies to continue drilling oil in commercial quantities, adding that crude oil would have little value and many oil based investments would be stranded.
“I have said this in several interviews that the search (for oil in Lake Chad basin) may not be in the best interest of the nation,” Mr. Onyekpere said.
GLOBAL DRIFT TOWARDS RENEWABLE ENERGY
In August, the world top producer of oil, Saudi Arabia, announced plans to exceed its target to generate 9.5 gigawatts of electricity from renewable energy annually, to highlight its long-term commitment to green energy.
“The whole idea of this is to give investors a sense of comfort that the Kingdom has a long-term vision for renewable energy,” Turki al-Shehri, Saudi oil minister, told Reuters.
The Saudi government said it plans to generate 9.5 gigawatts (GW) of electricity from renewable sources a year by 2023 through 60 projects, involving an estimated investment of between $30 billion and $50 billion.
Earlier, Bloomberg news agency reported that major global oil companies are joining Silicon Valley in backing energy-technology start-ups, a signal that that those with the deepest pockets in the global oil industry are casting around for a new strategy outside oil.
The report listed the oil majors to include Royal Dutch Shell Plc, Total SA, Chevron, Exxon Mobil Corp., among others. It added that the biggest investor-owned oil companies are putting money into ventures probing the edge of energy technologies. The investments, it added, go beyond wind and solar power into projects that improve electricity grids and brew new fuels from renewable resources.
The money involved, put at a fraction of the $7.5 billion that venture capital and private equity injected into the clean energy industry in 2016, aims to support work that may evolve into major income streams in the decades ahead as governments across the world work to limit fossil-fuel pollution and global warming.
Shell Technology Ventures, a unit of Royal Dutch Shell Plc, on its part split its spending between oil and gas technology and clean energy equally, according to the report. The green share, however, may increase to about 60 per cent in the years ahead, according to van de Wouw, an official of the oil firm.
In July, reports said several countries of the world already laid out ambitious plans to eliminate fossil fuel-powered automobiles. The reports listed France, Germany, Netherlands, China, Norway and India among these countries.
NIGERIA’S ‘OILY FUTURE’
In its search for oil in the North-east region, a Guardian report said that about $3 billion has been spent by the Nigerian government in seismic expedition, with the government bent on continuing its crude oil exploration in the region.
In September, Mr. Baru confirmed that the government would continue in its search, adding that contracts have been awarded.
“We have been on the issue of exploration in the frontier basins and so far some measures of steps have been taken. We have already purchased aeromagnetic data and its being interpreted to determine the sedimentary thickness and the basin configuration,” he said.
Analysts said the decision to continue with the search is worrisome, as such resources could be committed to other endeavours with developmental potential in the future. They also raised concerns about the value of oil in years to come.
“The world is thinking of renewable energy and we are still fixated on oil. It is really disturbing,” noted Mr. Rasfanjani of CISLAC.
For Mr. Garuba, Nigeria needs to think beyond oil and work around other alternative energy sources like other countries of the world.
He said, “What should bother us is the likely fate of oil in the nearest future. As it is often said, stone age ended not because of the lack of stones, but simply because of the growth in technology.
“Research on alternative sources of energy is advancing and the reliance on oil to drive technology will eclipse someday. The question should be whether investment in long time oil business is worth undertaking with all available resources.
“If you ask me, I will advise that we make such investment with caution; especially preparing our country and our people for a post-oil future. Only countries that invest in that future will reap the benefits when it eventually comes,” he added.
(This reporting was facilitated through a training programme of the Natural Resource Governance Institute, NRGI).