Diversification is now vital for our sustainability. Nigeria’s position in the energy transition is not one of passive vulnerability, but a real, underutilised opportunity… The global energy transition is an economic reality already repricing assets and redirecting capital across every major economy. Renewable energy could generate an estimated 14 million jobs across Africa by 2030, with four million in Nigeria.
In 1956, the year Egypt’s Gamal Abdel Nasser shook the global order by nationalising the Suez Canal, and Morocco, Tunisia, and Sudan tasted the exhilarating air of independence, something equally historic happened beneath Nigerian soil. At Oloibiri, decades of prospecting ended in a dramatic geyser of crude oil and with it, the promise of a nation “flowing with milk and honey”.
|
|
That promise was not entirely hollow.
Oil revenues built roads, funded institutions, and kept a fragile post-civil-war economy breathing. For a young nation assembling itself from the ground up, petroleum was a genuine lifeline.
|
|
|
|---|
But 40 billion barrels later, oil’s contribution to Nigeria’s prosperity has fallen dramatically short of what was possible. Today, approximately 87 million Nigerians live in poverty. Ours is the story of a nation that was, in many ways, held back by its resource endowment.
Great promise, pipe dreams
Despite its outsized fiscal contribution, the oil industry directly employs just 18,712 people – 0.02 per cent of a workforce exceeding 100 million. Given Nigeria’s large population, the industry was structurally incapable of delivering. That is not a political verdict. It is the nature of capital-intensive extractive industries.
Nigeria historically exported up to 97 per cent of crude, while importing refined petroleum products at international prices. We sold the raw material cheaply and bought the finished product at a high price. That is resource sabotage. It is a structural disadvantage that we have sought to address by establishing the Dangote Refinery.
History rarely gave credit for the fact that before oil, Nigeria was an agricultural powerhouse by any global standard. We were the world’s largest producer of palm oil, largest exporter of groundnuts, second-largest exporter of cocoa. A significant force in rubber, cotton and cassava markets.
We did not inherit underdevelopment. We traded a diversified, resilient economy for the singular bet on petroleum, as highlighted in a new report, “Pipe Dreams”, by Oil Change International and Power Shift Africa.
Between 1970 and 1985, cocoa production fell by 43 per cent, rubber by 29 per cent, cotton by 65 per cent, and groundnut exports by 64 per cent. By the mid-1980s, Nigeria had become a net importer of food, a reversal of fortune with consequences that still ripple through our macroeconomy and food security till date.
IRENA’s analysis shows clean energy investment creates two to three times more employment per dollar than equivalent fossil fuel investments. For a country with Nigeria’s extraordinary youth demographic, that ratio goes beyond environmental significance; it could be the most credible answer we have to our unemployment challenge.
In the Niger Delta, 88 per cent of local fishing businesses collapsed. Income from shellfish collection declined by 60 per cent and cassava yields fell by 48 per cent in affected areas. The Niger Delta environmental remediation costs alone are estimated at well over $11 billion.
The oil economy owes host communities a debt that isn’t just financial but also environmental, social, and economic; values that must be reshaped as we transition forward.
The terms of our partnerships with international oil companies deserve scrutiny. Evidence from the “Pipe Dreams” report shows that hydrocarbon contracts across African jurisdictions have frequently delivered investor returns well above standard risk-adjusted benchmarks.
When Nigeria and Angola moved to update their fiscal frameworks, major operators sought further concessions. This is the natural commercial behaviour of investors operating where the host government is perceived as more dependent on the deal than the capital provider.
New Opportunity
Diversification is now vital for our sustainability. Nigeria’s position in the energy transition is not one of passive vulnerability, but a real, underutilised opportunity.
The global energy transition is an economic reality already repricing assets and redirecting capital across every major economy. Renewable energy could generate an estimated 14 million jobs across Africa by 2030, with four million in Nigeria.
IRENA’s analysis shows clean energy investment creates two to three times more employment per dollar than equivalent fossil fuel investments. For a country with Nigeria’s extraordinary youth demographic, that ratio goes beyond environmental significance; it could be the most credible answer we have to our unemployment challenge.
We have abundant solar irradiation. We have critical mineral deposits central to clean energy supply chains. We have 220 million people – the majority under 30 – who represent a competitive advantage in a labour-intensive green industrial economy. These assets are awaiting activation.
Regardless of what the oil era contributed to this country’s foundation, what we do now is entirely within our power to determine. The global energy transition is not a threat arriving from outside. It is an opening Nigeria can walk through on her own terms, with her own assets and for her own people.
Yet, the path forward does not require abandoning existing hydrocarbon assets overnight, but rather a deliberate, strategic repositioning pursued with the same institutional focus once devoted to oil exploration. Concretely, that means:
- Deploying decentralised energy where people actually live. Energy access is not charity. It is the precondition for every other form of economic activity. Solar mini-grids and distributed wind systems can reach communities neglected by the traditional grid infrastructure.
- Anchoring the industry in our renewable advantage. A deliberate policy framework can leverage Nigeria’s solar endowment to drive agro-processing, manufacturing, and digital infrastructure, creating value chains that retain economic benefit at home.
- Designing clean energy investment around employment. Clean energy deployment can be geographically distributed and labour-accessible, meeting young Nigerians where they are and giving them careers, not just wages.
- Breaking the cycle of commodity-driven fiscal crisis. Every oil price collapse that triggers a Nigerian budget emergency is a reminder that dependence on a single volatile commodity is a structural choice. We can choose a diversified, domestically anchored energy economy to drive our future energy security needs.
Nigeria is not struggling because it found oil. Nigeria’s challenge is that it found oil and, for too long, stopped looking for, building, and investing in anything else.
Regardless of what the oil era contributed to this country’s foundation, what we do now is entirely within our power to determine. The global energy transition is not a threat arriving from outside. It is an opening Nigeria can walk through on her own terms, with her own assets and for her own people.
What this moment demands is political will, institutional clarity, and the collective conviction that Nigeria’s best chapter is not the one already written, but the one about to be written.
Terseer Ugbor is a member of the House of Representatives and the deputy chairman of the House Committee on Environment.
Discover more from Premium Times Nigeria
Subscribe to get the latest posts sent to your email.
