Page 73 - Vol 33 Issue 34 2021

Opinion oil

The consequences were clear but regrettable. In added the environment, this space comprising the
the early 2000s, this writer as a reporter covering land, air and the seas, which belongs to all humans.
the industry visited the Niger Delta and saw first- In the new way of reasoning, what happens to the
hand the impact of oil and gas production on the environment as a result of economic activity should
region. Wading through the meandering creeks, be captured in the cost of the resultant goods and
the rivers, swamps and land areas, one saw the services and be charged for.
devastation from oil in its raw form. From Abonema Mineral extraction is one of the most destructive
Wharf on the sea to Kula Kingdom, the travails of activities to undertake in man’s process to exploit
the natives in oil-laden communities were evident. nature for his economic and social advancement.
In Ogoniland, the charred remains of flora and The extractive industries - solid minerals mining
fauna, oil wellhead (called Christmas Tree, because and oil and gas exploration- have a peculiar impact
of its shape) still dripping with oil and smoke oozing in this regard. They affect not only the health of
out after the fire had stopped), were symbolic of humans but also the health of the environment.
the extent to which people’s lives and livelihood There have been documented cases of the
had been destroyed because of natural oil resource outbreak of diseases, including cancers, arising
exploitation. from oil exploration in the host communities.
That period was also the time when militancy in These are part of the cost of a barrel of crude oil
the region was at its peak. Oil and gas companies from the communities. To the extent that this is not
know this because they paid dearly for the reflected in the costing of oil from Nigeria, to that
neglect of the communities. The natives or their extent will restiveness in these places endure.
representatives rose in their rage and took on In this regard, the Host Community Development
the operators. The impact left a sour taste in the Fund, the epicentre of the controversy over the
mouth. Nigeria as a country felt it, with declining PIB, should be seen as an honest desire to put a
crude oil output and even a decline in exploratory price tag on the cost to the community of oil and
activities in the region. While the oil companies gas exploration and production. This price should
responded to this in part by moving further afield cover such things as pollution and degradation of
to the offshore and deep offshore territories, that air, water and land resources. The hullabaloo over
did not entirely solve the problem. it is uncalled for and the reduction of the value of
Those who systematically watered the original this contribution by the oil exploration companies,
document down, producing in the process various from even five per cent to three per cent, is most
versions of the legislation, know clearly that what unfortunate. Vendor Neutral
they dished out is an open invitation to a rekindling Microeconomic theory underpins the need Archive Technology
of the days of restiveness in the host communities. for full costing of all resources used in producing
Some twenty years ago, the government then goods and services. The need for this arises from IntriHEALTH® is the leading diagnostics solutions
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communities and concluded that that fire needed uses. Therefore, without full costing of assets,
to be quenched before it blew out of hands. Twenty their true worth, which is the forgone alternative,
long years passed, and the nation’s lawmakers, as would be missing in the economic equation. And Vendor Neutral Archive
well as the oil and gas community, know that their without this, the pricing of the good and/or service Unifies diverse practice branches on a
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job is not over on this contentious matter. PIB was produced will be defective because it will fail to
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The complexity of the PIB is a mere subterfuge achieving a low-cost oil production of about $10 Fully Compliant
and should not be allowed to overshadow the per barrel, when a major cost element like the Fully compliant with regulatory
standards
purpose of this piece of legislation. On the environment is underpriced or neglected.
one hand, it is a political economy document In the past, markets did not care about intangible Lossless Compression
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much and for what reasons should accrue to on organisations. Knowing that they will be held
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contentious issue. It’s an ongoing debate and will www.intrihealth.com
probably not come to an end. To the list has been Stay connected with IntriHEALTH

AFRICAN POWER Mining & Oil Review Vol33 Issue 34 2021 | 73