‘Oil companies contribution to host communities fall below expectations’

updated: Tuesday 17-02-2009

Chief Ufot Ekaette,
Niger Delta MinisterAddress delivered by Chief Ufot Ekaette, Minister of Niger Delta Affairs, during a meeting with executives of oil companies in Nigeria in Lagos, recently.

WE are here today as people on whose shoul- der the responsibility of developing the Niger Delta, rests. As you are aware, President Umaru Yar’Adua, created the Ministry of Niger Delta Affairs with the mandate to coordinate and fast-track the developing of the Niger Delta and subsequently appointed us to carry out the onerous task of implementing that agenda so as to bring about sustained peace and stability in the region.

Mr. President places so much premium on the development of the Niger Delta that he has included it in the seven-point agenda of his administration.

As a prelude to carrying out that assignment, we have been interacting with stakeholders in the region in order to feel their pulse and find out how best we can serve them. We feel our consultations would not be complete without meeting with the oil companies as major stakeholder in the Niger Delta. We want to hear from you how you intend to partner with us in our effort to transform the Niger Delta and restore peace in the area to enable you to operate maximally.

Our meeting with you was necessitated by the current crisis in the Niger Delta, which has already cost Nigeria and its people a lot in terms of human and capital resources. We need to take some drastic actions to prevent the conflict in the Niger Delta from deteriorating further.

We decided to come, interact with you, having heard directly from the various interest groups in the region, as part of our effort to achieve a lasting peace in the area and ensure a condusive atmosphere for your We are here not to apportion blame for what has been done in the past but to find answer to the many issues raised by leaders of oil communities and other stakeholders during our just-concluded foray with stakeholder in the Niger Delta.

There is no denying the fact that you have tried to carry out oil production in accordance with the rules and regulations put in place by the Nigerian Government under Joint Venture Agreement. It is also a fact that each of you has experimented with various development projects and programs for the respective communities in which you operate in the Niger Delta.

However, one discernable thread that runs through the length and breadth of the region is that the people of the area are yet to get the full benefits of oil production.

In other words, we recognise the fact that there is a growing discontent in the region arising from the gap between what the oil companies are giving to the oil communities in the Niger Delta and what they really expect. What the host communities are getting from you falls far below their expectations, given the magnitude of the problems generated by oil production in their respective communities.

From our interactions with the oil communities in the nine states that make up the Niger Delta, the complaints are far-reaching:

They complain that oil companies have not fully involved them in what they are doing and as such they feel alienated form the process.

That oil companies provide services only in areas that directly aid oil production and not as a deliberate attempt to develop the communities and improve the living conditions of the people.

That the discrimination has resulted in a situation where only oil workers and their facilities dotting the Niger Delta are provided with water, electricity and health facilities while their hosts remain in darkness, drink from oil-polluted sources and suffer from preventable diseases. In other words, while oil workers in their communities enjoy reasonable comfort, their hosts wallow in squalor and penury, thereby increasing their feeling of marginalisation and neglect.

That oil companies’ farm out jobs, which could effectively be handled by them to non-indigenes thereby contributing to unemployment and suffering in the region.

That oil firms prefer to embark on minor programs such as the renovation of town halls, health centers, donation of buses, boats and fishing gears etc. to their host communities instead of capital projects like roads, bridges and training of their people to be able to fit into the oil business and guarantee long tern benefits for them.

That while some oil companies have signed Global Memorandum of Understanding (GMoU), with some oil communities in the Niger Delta, they have not been faithful in implementing such agreements.

That many of the Memorandum of Understanding (MoU) are signed by oil companies as a means of pacifying the communities and not necessary to bring about the needed succor to them, besides, such MoUs are unilaterally reviewed by oil companies without consulting the communities.

That oil companies have remained indifferent to the environmental degradation of their farmlands, sources of drinking water and means of livelihood, thereby making them victims rather than beneficiaries of oil production.

That despite the growing level of unemployment in the Niger Delta, oil firm has not done much to provide direct employment or auxiliary job for the youths as a means of arresting restiveness in the oil region.

The oil communities also complain that one of the oil companies with strong presence in the Niger Delta is reported to have made a profit of over $39 billion in 2007 but has made little effort to impact the lives of the communities positively.

They are bitter that it is the Niger Delta that the said oil firm flares the highest volume of gas in the world. They wonder why a company that makes such a huge profit should not plough backs some of the revenue to change the face of the area where it is getting the oil and making such huge profit.

As major stakeholder in the Niger Delta, we expect you to reflect on these issues and think of new ways of delivery service to the people of the oil production has brought to Houston Texas, Canada, Qatar, Saudi Arabia and Mexico to name but a few and we want the same level of treatment of oil communities in those countries to be brought to bear in the Niger Delta.

We have come to a point in the history of the Niger Delta where we have to adopt drastic measures dictated by the circumstances of the time, to provide succor for the people of the oil communities. Unlike in the past when communities were contented with minor schemes and freebies, oil companies should now begin to provide basic infrastructure that can guarantee long term benefits for the majority of the people of the region.

Since inaccessibility to the oil bearing communities of the Niger Delta appears as a recurring decimal, we wish to advice that you consider the construction of road to link up the oil communities as part of your community relations practice and sustainable development program. It is also our firm belief that if oil firms employ people from their host communities to do most of the jobs, which are sometimes given out to non-indigenes, the level of restiveness in those areas would be drastically reduced.

Oil firm should begin to embark on special training program to enable indigenes of their host communities to fit into some aspects of oil production in order to give them a sense of belonging. Continued marginalization of the people of oil communities can only heighten tension and give room for criminals to make the Niger Delta unstable for oil production.

We want to draw your attention to what the Nigerian Liquefied Natural Gas Company is doing in Bonny Island in River State . Although it may not be the perfect form of relationship in the world, it is something that is worthy of emulation by other oil and gas firm in the country. With a workable Mou in place, the company has been able to transform the area into a modern city under a peaceful and harmonious atmosphere. Under the GMOU, the people are made to be involved in the process to select concrete projects that meet their long term interest; they are allowed to participate in the monitoring and execution of the projects. With such an arrangement the people see the projects as theirs and do everything to ensure that they are adequately protected.

Oil companies that want to do business in the Niger Delta must now begin to partner with us in order to change the story of the suffering and deprivation in the oil communities.

They must be ready to engage the communities in meaningful ways to enable the natives to see themselves as partners rather than enemies.

This can only come about when the people see themselves as integral part of the oil firms’ activities in their area and can point to concrete things that add value to their daily lives. The tendency to resort to the policy of ‘divide and rule’ should give way to collaborative partnership and harmony.

As we have already pointed out during our meetings with the oil communities, the Niger Delta Ministry as in intervention and coordinating agency of the Federal Government is ready and willing to partner with major stakeholders in the Niger Delta-the state and local governments, oil companies, the youth and women groups etc, in the task of transforming the region.

We expect you to join hands with us in facilitating the desired change so as to bring about peace in the region.

We want to embark on projects and programs that will make people to feel the impact of oil production and to change their current negative disposition towards oil operations. We implore you to be part of the effort to make the required difference in the lives of the people of the oil communities.

We believe we can work together to make the difference. We need to hear from you on how you can partner with us so that we can avoid duplication of projects and programs in the interest of the oil communities.

We thank you for this opportunity and hope we can work together to bring about positive change for Niger Delta and Nigeria .