The Role Of Oil Companies In The Nigerian Developmental Process

The Role Of Oil Companies In The Nigerian Developmental Process

Chapter One

Preface

The quantum of the patron’s wealth is a conjecture depending on price, system, and position of out put and peace of product. Nigeria is an oil painting- producing nation, and oil painting occupies a veritably important position among the nations profit sources. Its significance in the nations frugality can not be explained solely in terms of barrels produced and vended. Other important variables similar as the dynamics of transnational energy requests the part of association of petroleum exporting countries( OPEC) the political realities country, are all significant aspects.

With the veritably strategic position oil painting profit occupies in the Nigerian frugality, counting for over three – diggings of government profit from all sources, Nigeria has always dreaded inimical changes from oil painting prices in general and from OPEC’s holds the you and the cutter. This miracle has earned the popular saying that “ when OPEC ’S oil painting polices in particular as these changes oppressively and concertedly affect our public development process, OPEC determines the number of barrels of oil painting to be produced and vended per day by any member country. In this realistic position, OPEC holds the yam and the cutter. He determines whatever portion any member nations eats. This miracle has earned the popular saying that when OPEC sneezed, member nation frugality cried out “.

Presently, profit from oil painting is trying to wake up from a deep slumber it fell into for so numerous times now. With the current OPEC product, import volume, domestic consumption position, Nigeria expects a brighter future and has grounded the budgets on the proceeds. These show not only Nigerian frugality on oil painting profit for case, the maturity of the estimated federally collectable profit comes from oil painting source whilenon-oil source are anticipated to yield a nonage of total estimated profit.

At the time oil painting was discovered in marketable volume in Nigeria in 1956 up to the time product and disquisition took place in 1958, the country had reckoned on imported petroleum products to meet it’s domestic conditions. As oil painting hadn’t started to enthrall the commanding height of the public frugality, disquisition and product were in the hands of a British company( shell D’Avcy 9 shell BP). The emphasis of the government dividing this period was to give a roper advisory an nonsupervisory body to supervise the conditioning of the foreign oil painting companies. This company shell D’Avcy( now shell BP) continued as the sole concessionaire in Nigeria until 1959 when exclusive disquisition right came available to companies of other ethnicities. In 1961, other companies Gulf, Agip, Safrep( now Elf) Tennnesco and Amoseas( now Texaco Nig. Ltd) Mobil. Ap etc, started concertedly the explorers for oil painting in the on share areas of Nigeria.

As the times went by, petroleum policy was geared towards direct and active participation in the three phases of the assiduity, videlicet, disquisition and drilling, refining, distribution and marketing. Hence after replying a product position of1.531 mbd in 1973 representing about 31 of total world oil painting product and the establishing herself as an oil painting fiefdom, Nigeria Joined the Organization of Petroleum Exporting Countries( OPEC). With the Nigerian enterprises creation decree 1977, this figure had gone up to about 60 in some of the oil painting companies. also the Nigerian National Oil Corporation( Nnod was established in 1971 to give effect to direct exploitation of the countries strategic coffers.

Statement Of Problem

oil painting is a commodity like no other. It’s a high source of energy that can not be snappily replaced. It’s product is held in many hand. It’s directors can chosen at the turn of value either to increase its flower to reserve it in the ground. In the farther, in it stores value of1.291 mbd and atterage demostic consumption of 300,00 mbd. Since the oil painting smash, one would anticipate a reasonable position in growth, development and artificial listen but substantiation has give other wise.

Although Nigeria’s oil painting assiduity has contributed largely to the growth trouble in the country and has handed enhanced profit to the government especially during the oil painting smash 1970’s the full benefits of the assiduity have been realized. Indeed, Nigeria’s oil painting assiduity has operated with minimal relation. Indeed, Nigeria’s oil painting assiduity has operated with minimal relation with the ret of the frugality. For case, for over thirty times of marketable discovery, product and exploitation of crude oil painting, petroleum technology for your industrialization and development will our oil painting profit has been nearly insolvable.

The bulk of our oil painting profit is thus spent on the importation of colorful- consumer goods. Capital goods and other husbandry yield which could be cultivated in Nigeria in reasonable volume therefore our hard- earned oil painting profit has only succeeded in keeping foreign growers employed and in keeping foreign diligence working. In this manner, the substantiation of substantial growth in the frugality has neither redounded into important development nor into significant metamorphosis of the frugality.

The marketing and distribution of petroleum products were entirely in the private hands. This lasted up to 1975 when the private companies cold no longer meet the domestic demand for the product. This was as a result of the expansion of profitable conditioning and the unknown explosion in the demand for the products owing to the quick recovery from there Nigerian Civil War( 1967- 1970).

previous to this time, there was lack of uniformity throughout the country in the price of petroleum products. The pump price system, depending on the point of trade. The oil painting marketing companies naturally concentrated heir at law conditioning in areas where cost of distribution was smallest and profit were loftiest. Lagos and Port Harcourt areas were well served while the outlands were process of profitable growth and development of all nations.

maturity of people hold the articulation that oil painting has not played a pivotal part in the process of profitable growth and development of Nigeria due to advance domestic backups. Intermittent and abrupt wide spread saturates of petroleum product, lack of acceptable road tempers and uneasy access to spare corridor.

Others on the other hands, hold he view that the major constraints lie with the transnational backups; the shady oil painting deals smuggling and bunkering, crude oil painting price glut and the Nigeria class in Organization of Petroleum Exporting Countries( OPEC).

maybe, the root of all the backups lies in cure part of oil painting companies in the Nigerian profitable development process.

It’s thus, the purpose of this study to examine the places the oil painting companies play in our profitable development process and also inversely grope out other blights, institutional, productive and distribution blights that form stumbling blocks to our profitable development.

exploration ideal

Having defined the problem of the design study and concluded by bringing our the overall end of the exploration, it’s necessary at this juncture, to present the specific objects which this work intends to achieve.

1. To examine the exact places of oil painting companies in the Nigerian profitable development process.

2. To mokes the extent to which they’ve achieve the places.

3. To examine he goods of the association of Petroleum Exporting Countries( OPEC) on the price, demand and force of the Nigeria crude oil painting.

4. To examine the goods of the invariant pricing policy of the government on the domestic consumption of petroleum products.

5. To search for the problem that defy the anticipated part of oil painting assiduity as a whole in the Nigerian profitable development process, and give recommendations of the achievement of the needed places.

exploration thesis

In other to carry out this study, and in view of the stated objects of this work, there thesis have been formulated they are-

1. The donation of oil painting sectors in Nigeria justifier the huge investments being committed to sector by civil government.

2. The erratic nature of the world oil painting prices has been a great influence on the trend of the Nigerian profitable development sweats.

3. Domestic consumer of petroleum petrol diesel, kerosene, etc are satisfied with the present position of distribution of the products.

SIGNIFICANCE OF STUDY

This work is significant in exposing the complications in he oil painting assiduity with the view to making strategic the position this sector holds in Nigerian frugality public the main stay of the frugality.

It’ll inversely make estimable the need diversify the Nigerian frugality and pay attention to other profit source especially husbandry source is said that, two good heads are beer than one. In the same avian, oil painting is noway , and will flash back be the only source of energy; Nigeria is endowed abundantly with other energy source, videlicet coal, natural jas and uranium.

Information and recommendation given in this work won’t only be useful to the oil painting companies in formulating better polices to ameliorate their distribution system but will also be useful to the government in checking the overdue surpluses of hoarding, bunkering and smuggling of petroleum products, and more importantly the abating of the crude oil painting prices.

Eventually the result from this study will be useful for farther studies into this aspect of our frugality especially the inefficiencies associated with the oil painting assiduity arising from wide spread sleight, tendencies toward price increase or drop with the attendant social profitable uneasiness.

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