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Resource Extraction: How Ogoni Could Have Been Better Managed

According to a policy brief by the Nigerian Natural Resource Charter (NNRC), effective resource management involves maximizing benefits from resources while minimizing the costs imposed on the host communities. The case of Ogoniland is a classic example of how Nigeria failed in that regard, leaving the consequences to linger, writes e360

 

The federal government at a town hall meeting with stakeholders in Bori last week, pleaded for calm and peace to allow for the smooth takeoff of the Ogoniland clean-up. Government officials stressed that unless the people remain peaceful, their actions could delay (the already delayed) commencement of the clean-up of oil impacted communities in the area.

The Ogoniland oil spill issue is considered one of the world’s worst cases according to the United Nations. In 2011, a United Nations Environmental Programme (UNEP) report, commissioned by Shell, said it could take 30 years for the impacted area to fully recover from the damage caused by years of oil spills, for which Shell accepted part liability, blaming locals as well.

The resource rich Ogoniland in Nigeria’s Niger Delta region was a predominantly fishing community until oil spills from Shell’s operated facilities in the area devastated the land. Rather than a swift response to remedy the situation, years of blame trade as to who is fully responsible for the disaster followed. While Shell accepted part responsibility, the company blamed locals who vandalise its facilities for part of the spills. Then funding for the cleanup became another challenge.

Oil spills incidents is not peculiar to Nigeria alone, but it is the apparent mismanagement of the Ogoni spills case that makes the difference. While it is expected that communities would, to some extent, bear the disproportionate costs of resource extraction from environmental hazard and other socio-economic effects, according to the NNRC policy brief, it is also expected that priority be placed on minimizing the costs on the host communities as much as it is placed on maximizing the benefits from resources. But the Nigerian government failed to swiftly address the disaster, leaving the people to suffer severe hardships and health hazards for years.  

Polluted stream

 

For instance, the cleanup of the April 2010, BP oil spill disaster in the Gulf of Mexico, which is considered to be the largest marine oil spill in the history of the petroleum industry, was declared substantially complete in April 2014. 

Following the spill, a massive response ensued to minimizing the damage from the spreading oil. In the end, BP agreed to a $4.5 billion in fines and other payments with the US government. As of February 2013, the company had expended $42.2 billion on criminal and civil settlements and payments to a trust fund.

The responsiveness of both the operator and the US government to the cleanup of the spill which discharged an estimated 4.9 million barrels into the water, is a reference point which contrasts with the unresponsiveness of the Nigerian government and operator alike, in the case of Ogoni oil spill. 

However, Dr Marvin Dekil, the project coordinator, Hydrocarbon Pollution Remediation Project (HYPREP) in the federal ministry of environment, while speaking during the meeting which held in Bori, Khana Local Government Area of Rivers State, reiterated the present government’s commitment to the clean-up exercise, emphasizing that peace was needed in the area to enable contractors commence clean-up of decades-long oil spills. 

HYPREP had in January presented and handed over the sites to contractors who were tasked to carry out the remediation works in the communities. Ogoniland covers four local government areas including Eleme, Gokana, Khana and Tai. The contract for the clean-up exercise is put at N3.039 billion. The fund is put together by Shell and its JV partners, as well as the federal government. But restiveness has stalled the takeoff of the exercise in some areas.

Dekil while expressing sadness during the meeting over the lack of progress report on the project in most of the affected areas due to conflicts said, “Our meeting today would have been to inform the people of the level of work achieved by the contractors working in the communities. But, regrettably, we do not have any report to give. The reason is not far-fetched as restiveness affects people and activities.”

Devastated Farmlands

 

He noted however, that remediation works had fully commenced in Eleme local government area due to relative peace in the area, adding that youths in such places have already been engaged by the contractors.

He reminded the people that youth engagement and empowerment was a critical component of the clean-up project as recommended by the UNEP, adding, “We are urging the youths of Ogoni to give peace a chance; support the clean-up project and take full advantage of the opportunities that the clean-up brings.”

Blaming poverty and unemployment for the situation, the chairman of Khana local government council, Lateh Loolo, stated that poverty and unemployment are among factors responsible for restiveness in the area. “We appeal that HYPREP initiates more developmental programmes for our people such as skills acquisition training as well as human capital development,” Loolo said.

The Ogoni situation could have been better managed or minimized with proper management of resource exploration process, as natural resources ought to ordinarily benefit communities where extractive activities take place, particularly through transfer of resource revenues and corporate interventions rather than a plague, that became of Ogoniland.

In its 2017 assessment of the performance of Nigeria’s oil and gas sector against the 12 precepts of the Natural Resource Charter, NNRC found that Nigeria currently performs below average in managing local impacts of resource extraction.

Detailing the relevant findings in its Benchmarking Exercise Report (BER) 2017, captured in precept 5, it provided actionable policy recommendations that can enhance the management of local impacts of resource extraction, especially in response to the challenges identified in the BER.

Oil Spill

 

It noted that building an environment of trust and collaboration among host communities is critical for averting conflicts and maintaining good working relationships between all stakeholders.

The 2017 BER also noted that poorly defined social contracts between the host communities, government and industry players lead to an absence of trust. It also identified the lack of policies that enable meaningful participation of host communities in decision making as well as untenable public expectations due to the absence of an effective communication strategy as the factors limiting trust among host communities.

It therefore, recommended that government make provisions within the laws guiding industry practice that guarantee meaningful participation of host communities throughout the decision-making process as well as to develop a clear and effective communication strategy that creates viable expectations about the impacts of extractive activities to avoid untenable public expectations. This would help manage host communities’ expectation of benefits and improve their awareness of adverse effects of resource extraction prior to commencement.

Furthermore, to avoid mistrust and host community crisis in the future, the 2017 BER recommends the training of community groups on oil and gas sector issues to enable them understand the sector better and position them to make meaningful contributions in decision-making and sector enterprise. 

To forestall future occurrence, there is need for state actors to adopt the principles proposed in the NRC Framework to minimize the environmental, social and economic costs of extraction, particularly on host communities.

Furthermore, political parties in resource-rich countries, being important players in resource governance, should take responsibility in managing public expectations and delivering on promises. It is of key importance for political parties to articulate well thought-out, informed and comprehensive policy positions that cover relevant issues across the oil sector value chain.

 

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