The quest for crude oil in Northern Nigeria
NaijaRock
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Posted by Felix Okoli on Tuesday August 30, 2016 at 11:22:45:
When many Nigerians in the south hear about how how the Nigerian government and most especially northern politicians are aggressively searching for oil in Northern Nigeria, they laugh and mock it as a wild good chase. "How can oil be discovered in a land that is dry" they may say. They says so because they feel that Southern Nigeria is more blessed than Northern Nigeria in terms of crude oil and see the quest for oil as nothing else but something done out of jealousy and in a bid to become as rich as the south.You won't blame Nigerians who don't support the search for oil in a region that has been more agriculturally blessed than oil blessed. Nigeria's oil rich regions since the 1960s are in the south, particularly in the Niger Delta areas and the comprising states have made a lot of money from the resource which generates over 90% of Nigeria's foreign income. Proceeds from crude oil has kept Nigeria financially buoyant for the past 30 years and one wonders why the trillions it has generated had not been used to diversify the mono-based economy till date.To hear that the Federal government is using a good amount of our national resources to search for oil in northern Nigeria is a bit confusing. Last time I checked, the cost has risen to over $400 million! That amount of money would have made millions of lives better and created a lot of jobs through economy diversification. Personally, I would prefer if such amount of money were used to invest in mechanized farming to grow Nigeria's food output. As a nation that has a lot of resources, we should not be importing food items like bags or rice or tin tomatoes when we have a wide expanse of fertile land. Yes, we shouldn't be importing rice, fish and chicken. I think the government should simply try to diversify the economy by investing more in agriculture so that we may also become a food exporting country as was the case in the past before the over-reliance on oil. Back in the days, Nigeria's used to be a major producer or palm oil and groundnut but now, the Asian countries have taken over. What happened to the pyramids of Kano?When oil was first discovered in commercial quantity in Southern Nigeria, I'm sure it was not as costly as the over $400 million that has been spent so far in looking for crude oil in a region that has been blessed with agriculture. It seems that it's harder to find oil in the Norther than in the South of Nigeria and so I would recommend they simply invest in areas where they are already strong rather than trying to invest in areas where they are weak. I believe that is similar to what economists call the law of comparative advantage. It's not that oil cannot be discovered in Northern Nigeria or that some states in that region don't have crude oil buried deep in their grounds but the issue is on whether it would actually be economically viable to focus on crude oil exploration in the north when it's cheaper to do so in the south.Well, I agree that there are some benefits of oil search in Northern Nigeria such as the fact that if one or 2 Northern states become oil producing states, it would offer some competition to oil wells in Southern Nigeria and it may attract foreign investors to the North rather than going to the south where there is a lot of violence and kidnapping. The question then will be whether violence and kidnapping that are rampant in the oil blessed Niger Delta regions of Southern Nigeria will not also occur in the oil producing states of Northern Nigeria. One thing I'm sure about terrorists or kidnappers is that they tend to target areas with wealth and the reason why they seem to be focused on the Niger Delta region is because that is where the billions of Naira are made in Nigeria. Another benefit of having oil producing states in Northern Nigeria will be that it would help make Northern Nigeria richer and less dependent on the oil wealth that comes from the South. Some politicians from Southern Nigeria have abused the north as being parasites since they contribute little or nothing while the south contributes most to the economy. Having oil wealth in Nigeria comes with benefits and this has made Nigeria's south richer. This is because the oil producing states of Nigeria get some extra benefits called oil derivation benefits and that's about 13% of the oil wealth they generate. Not all states in Nigeria get that and it's only limited to states that produce oil. Nigerian states like Bayelsa, Rivers, Abia, Ondo and Delta are among the richest states in Nigeria because of their oil wealth and benefits they get from the Federal government for being oil producing states.A look at the list of the richest states in Nigeria shows that most of the richest states on the first 10 on the list are from the south and oil producing regions while a good majority of states in Northern Nigeria are among the poorest states. The only states which are listed among the top 10 which are not oil producing states are Lagos(), Kano and Kaduna and that's probably because of the income they generate from taxes as a result of their high population which ranges from 2 to 10 million people.Nigeria's over-dependence on crude oil is not realistic and a bad plan. The market for Crude oil is something intelligent people have predicted is going out of fashion as the world is moving to a greener sources of power. However the market for fresh food products from the farm will always remain as humans will always eat food. Yes, they will always eat food but they may not always need crude oil. It's time to diversify the economy and stop doing the same mistakes out ancestors did by operating a mono-economy.I support the quest for oil in the North only if it's economically reasonable to do so and it would be actually more profitable than the patronizing the existing oil wells in the Niger Delta. If not, then it's better to stop wasting those funds and invest them in agricultural projects to boost the nation's food output as agriculture is what Northern Nigeria has been known for all the while. As far as I know, $400 million is not chicken change o!
When many Nigerians in the south hear about how how the Nigerian government and most especially northern politicians are aggressively searching for oil in Northern Nigeria, they laugh and mock it as a wild good chase. "How can oil be discovered in a land that is dry" they may say. They says so because they feel that Southern Nigeria is more blessed than Northern Nigeria in terms of crude oil and see the quest for oil as nothing else but something done out of jealousy and in a bid to become as rich as the south.You won't blame Nigerians who don't support the search for oil in a region that has been more agriculturally blessed than oil blessed. Nigeria's oil rich regions since the 1960s are in the south, particularly in the Niger Delta areas and the comprising states have made a lot of money from the resource which generates over 90% of Nigeria's foreign income. Proceeds from crude oil has kept Nigeria financially buoyant for the past 30 years and one wonders why the trillions it has generated had not been used to diversify the mono-based economy till date.To hear that the Federal government is using a good amount of our national resources to search for oil in northern Nigeria is a bit confusing. Last time I checked, the cost has risen to over $400 million! That amount of money would have made millions of lives better and created a lot of jobs through economy diversification. Personally, I would prefer if such amount of money were used to invest in mechanized farming to grow Nigeria's food output. As a nation that has a lot of resources, we should not be importing food items like bags or rice or tin tomatoes when we have a wide expanse of fertile land. Yes, we shouldn't be importing rice, fish and chicken. I think the government should simply try to diversify the economy by investing more in agriculture so that we may also become a food exporting country as was the case in the past before the over-reliance on oil. Back in the days, Nigeria's used to be a major producer or palm oil and groundnut but now, the Asian countries have taken over. What happened to the pyramids of Kano?When oil was first discovered in commercial quantity in Southern Nigeria, I'm sure it was not as costly as the over $400 million that has been spent so far in looking for crude oil in a region that has been blessed with agriculture. It seems that it's harder to find oil in the Norther than in the South of Nigeria and so I would recommend they simply invest in areas where they are already strong rather than trying to invest in areas where they are weak. I believe that is similar to what economists call the law of comparative advantage. It's not that oil cannot be discovered in Northern Nigeria or that some states in that region don't have crude oil buried deep in their grounds but the issue is on whether it would actually be economically viable to focus on crude oil exploration in the north when it's cheaper to do so in the south.Well, I agree that there are some benefits of oil search in Northern Nigeria such as the fact that if one or 2 Northern states become oil producing states, it would offer some competition to oil wells in Southern Nigeria and it may attract foreign investors to the North rather than going to the south where there is a lot of violence and kidnapping. The question then will be whether violence and kidnapping that are rampant in the oil blessed Niger Delta regions of Southern Nigeria will not also occur in the oil producing states of Northern Nigeria. One thing I'm sure about terrorists or kidnappers is that they tend to target areas with wealth and the reason why they seem to be focused on the Niger Delta region is because that is where the billions of Naira are made in Nigeria. Another benefit of having oil producing states in Northern Nigeria will be that it would help make Northern Nigeria richer and less dependent on the oil wealth that comes from the South. Some politicians from Southern Nigeria have abused the north as being parasites since they contribute little or nothing while the south contributes most to the economy. Having oil wealth in Nigeria comes with benefits and this has made Nigeria's south richer. This is because the oil producing states of Nigeria get some extra benefits called oil derivation benefits and that's about 13% of the oil wealth they generate. Not all states in Nigeria get that and it's only limited to states that produce oil. Nigerian states like Bayelsa, Rivers, Abia, Ondo and Delta are among the richest states in Nigeria because of their oil wealth and benefits they get from the Federal government for being oil producing states.A look at the list of the richest states in Nigeria shows that most of the richest states on the first 10 on the list are from the south and oil producing regions while a good majority of states in Northern Nigeria are among the poorest states. The only states which are listed among the top 10 which are not oil producing states are Lagos(), Kano and Kaduna and that's probably because of the income they generate from taxes as a result of their high population which ranges from 2 to 10 million people.Nigeria's over-dependence on crude oil is not realistic and a bad plan. The market for Crude oil is something intelligent people have predicted is going out of fashion as the world is moving to a greener sources of power. However the market for fresh food products from the farm will always remain as humans will always eat food. Yes, they will always eat food but they may not always need crude oil. It's time to diversify the economy and stop doing the same mistakes out ancestors did by operating a mono-economy.I support the quest for oil in the North only if it's economically reasonable to do so and it would be actually more profitable than the patronizing the existing oil wells in the Niger Delta. If not, then it's better to stop wasting those funds and invest them in agricultural projects to boost the nation's food output as agriculture is what Northern Nigeria has been known for all the while. As far as I know, $400 million is not chicken change o!