Essay on Oil Industry and Nigerian Development - 4319 Words

Oil Industry and Nigerian Development Oil is one of the most valuable natural resources in the world today. The oil industry carries with it a great deal of economic and political power across the globe. Having oil, or any natural resource, as a prime source of revenue has long been debated as being an advantage or a drawback. In any case it should at least lead to increased revenue and financing of industrial growth which, arguably, is related to an increase in the quality of life of the population. In the case of Nigeria, the oil industry is a double-edged sword. Since the discovery of oil in 1956, the oil industry in Nigeria has greatly increased the financial resources of Nigeria, and yet has proven a constant stumbling block in†¦show more content†¦Nigeria has traveled a unique path in its journey as an world oil power. Almost immediately after the discovery of oil in 1956, Nigeria was granted independence from Britain. Interestingly enough, it was also at this time that all ownership of mineral rights were transferred to the Nigerian government. All new and existing oil companies had to become entities of the Nigerian government. The next few decades were very difficult for the nation as a whole. Political and social turmoil, civil war, along with sharp rises and, more notably, falls in global oil prices severely affected the oil industry in terms of integrity, applied revenue that suffered under various military regimes, and public trust. It was also in this period that Nigeria began to incur large amounts of foreign debt. Military dictators sought foreign aid with the expressed intention of improving the fundamental elements of social and economic welfare of a relatively new nation, however, in practice, revenue was poorly allocated, and basicShow MoreRelatedThe Petroleum Revenue And Economic Growth Essay1610 Words   |  7 PagesBACKGROUND The Petroleum industry in Nigeria is the largest source of government revenue and it occupies a pivotal position in term of foreign exchange earnings with about 90 percent and over 80 percent contribution to the Gross domestic product. Petroleum sector is the mainstay of Nigerian economy since its discovery in commercial quantity in Oloibiri, Bayelsa State Nigeria in 1956. From 1970 to 2009, the income from petroleum stood at 82 percent with 18 percent from non-oil revenue. According toRead MoreThe First Commercial Discovery And Operation Of Oil And Gas Essay1720 Words   |  7 Pagesdiscovery and operation of oil and gas in Nigeria commenced effectively in 1956. Since then, the Nigerian economy has over time become largely dependent on petroleum. Petroleum accounts for about one-third of the country’s Gross Domestic Product (GDP), 76% of government revenue, and 95% of the foreign exchange earnings. Nigeria is the 11th largest crude oil producer in the world, and the larges t crude oil producer in Africa contributing about 3% of the global crude oil production . Nigeria is alsoRead MoreThe Giant Bomu Oil Field Essay1531 Words   |  7 PagesThe giant Bomu oil field in Ogoni located in Gokana Local Government Area, which has estimated ultimate recovery of 0.311 billion of barrels of oil and a total of 0.608 billion of barrels of oil equivalent including gas, was discovered in 1958 (Aniefiok et al 2013, Amanyie 2006, and Vassilion 2009). According to Amanyie (2005; 2006), in the late 1950s oil was struck in commercial quantity at Lekuma Khana in Ogoni soil, and in Bomu oil field in 1958. 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Hence, the Extractive Industries Transparency Initiative (hereafter the EITI) and many other international financial institutions have advocated that only greater accountability and transparency through disclosure of financial and non-financial transactions relating to petroleum contracts including investments in local content could cure the curse of oil resources (Klieman, 2012; Short, 2014). Nigeria, where â€Å"oil becomes a problem rather than a solution† (KopinskiRead MoreThe Discovery Of Oil And Its Effects On The World With Energy1506 Words   |  7 PagesIn 1958, oil was first discovered in Nigeria. The discovery has led to the transition from agriculture-based economy to that of oil economy. One would believe that a country that produces a numerous amount of oil used to support the world with energy would have improved domestic infrastructures and economic development. Unfortunately, this is not the case in Nigeria. 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