Ogoni Oil: Economic and Political Underrepresentation, and Environmental Degradation

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Ogoni Oil: Economic and Political
Underrepresentation, and Environmental
Degradation
Centre for Environment, Human Rights and Development, 2014

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Title Page
SPRING 2015
GLOBAL STUDIES CAPSTONE SEMINAR
SONOMA STATE UNIVERSITY
TITLE OF REPORT Ogoni Oil: Economic and Political
Underrepresentation, and Environmental
Degradation
GROUP The Underrepresented Ones
HAND-IN DATE April 30th, 2015
SUPERVISOR Rheyna Laney and Jeff Baldwin
TOTAL NORMAL PAGES 57.45 pages (137,888 characters with
spaces)
Rebekah Cryderman
________________
Lauren Silveira
________________
Jackson Stogner
________________
Taylor Vitangeli
________________

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Acknowledgments and Dedication
Our research team is grateful for the opportunity to learn from our peers and our professors at
Sonoma State University throughout our academic career. We would like to take the time to
thank our Senior Capstone Thesis advisors: John Nardine, Dr. Jeff Baldwin, and Dr. Rheyna
Laney. We would also like to express our appreciation to the authors from whom we have used
throughout our research to gain extensive knowledge on the topics of the resource curse,
corruption, political ecology, environmental degradation, and social movements. Lastly, we
would like to vocalize our gratitude and reverence to the local communities of the Niger Delta
who continue to strive for their improved well-being despite structural hindrances.
Cover photo of a protest by the Movement for the Survival of the Ogoni People (MOSOP) in
River State in 2014.
Photo courtesy of the Centre for Environment, Human Rights and Development
(http://cehrd.com/our-environment-is-our-life-clean-up-and-pay-up-now/).

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Abstract
Nigeria’s government, through corrupt practices, has excluded, politically and economically,
many ethnic communities in the Niger Delta. These same corrupt practices that have resulted in
the underrepresentation of local communities have also caused the marginalization and neglect
of the local environment. This neglect of the local environment has further marginalized the
local people who rely on the environment as a way of life. The Ogoni community of the Niger
Delta serves as a case study for this all-too-common path of developing regions of the world that
concentrate on resource extraction. They also represent a community that is mobilizing to
address these concerns, and though significant strides at the federal level are yet to be made,
there continues to be advocacy for progress on economic, political, and environmental issues.
The global context of resource extraction allows the broad themes and salient patterns found
through this research to become applicable for further research on other communities, and their
social movements, across the globe.
Key Words: Niger Delta, Underrepresentation, Social Movements, Oil, Resource Curse,
Corruption, Political Ecology.

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Table of Contents
1. Introduction
2. Methodology and Research Design
2.1 Approaches
2.2 Case Boundaries
2.3 Frameworks
2.4 Key Terms
3. Literature Review
3.1 The Resource Curse
3.2 Corruption
3.3 Political Ecology
3.4 Local People of the Niger Delta and Oil
3.5 Oil Industry and the Environment
4. Case Study
4.1 Petrol and Layered Logistics
4.2 Impaired Institutions
4.3 Facts about The Ogoni
4.4 The Economic Context of Development
4.5 The Story of Shell Oil
4.6 Environmental Degradation
4.6.1 Environmental Degradation
4.6.2 Environmental Regulations
4.7 Forms of Representation in the Delta
4.7.1 MOSOP
4.7.2 MEND
4.7.3 Local NGOs and Civil Organizations
4.7.4 Regional NGOs
5. Analysis
5.1 The Resource Curse
5.2 Corruption
5.2.1 The Role of Shell Oil

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6. Conclusion
7. Perspectives

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Abbreviations
AGRA: The Associated Gas Re-injection Act 1979
ANEEJ: African Network for Environment and Economic Justice
DPR: Department of Petroleum Resources
EEFC: [Nigerian] Economic and Financial Crimes Commission
GDP: Gross Domestic Product
IRIN: Integrated regional Information Networks
MEND: Movement for the Emancipation of the Niger Delta
MNEs: multinational enterprises
MOCs: multinational oil companies
MOSOP: Movement for the Survival of he Ogoni People
NDDC: Niger Delta Development Commission
NEITI: Nigeria Extractive Industries Transparency Initiative
NER: Nigeria Economic Report
NGO: Non- Governmental Organization
NNOC: Nigerian National Oil Corporation
NNPC: Nigerian National Petroleum Corporation
OEL: Oil Exploration License
OGEPA: Ogoni Environmental Protection Agency
OML: Oil Mining Lease
OPEC: Organization of Petroleum Exporting Countries
OPL: Oil Prospecting License
PPT: Petroleum Profit Tax
PSCs: Production Sharing Contracts
PWYP: Pay What You Publish
RMAFC: Revenue Mobilization Allocation and Fiscal Commission
RSSDP: Rivers State Sustainable Development Program
SPDC: Shell Petroleum Development Company
TNOCs: Transnational oil companies
TPH: Total petroleum hydrocarbon
UN: United Nation

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UNEP: United Nations Environment Program
UNPO: Unrepresented Nations and Peoples Organization
BBC 2015

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Ogoni Oil: Economic and Political Underrepresentation, and Environmental Degradation
1. Introduction
The topic of minority underrepresentation and its potential effects upon the environment
arose through a classroom brainstorming session dedicated to drawing out the different focuses
our Global Studies major. We then synthesized multiple ideas into a single topic in order to
reveal a new path of exploration for our research project. With our concentrations differing
between Social, Political and Economic Development and Global Environmental Policy, we
realized the potential in covering a topic that allows us all to delve into each of these realms. The
interdisciplinary nature of Global Studies allows us to come into contact with similar issues of
resource extraction and indigenous empowerment in developing areas of the world, expanding
our case study options. Each of our group members has had some exposure to this topic through
a variety of courses such as World Regions in a Global Context and Liberation Ecologies. To
further focus our topic on a specific region and situation, we discussed options at length
involving nearly every continent. After a period of meditation on the exact circumstance to write
about, we decided on the oil extraction industry of Nigeria and its local community members
who are not involved with, or benefiting from, those processes. This option appeals to our group
because of personal commitments to social justice, current reports of Nigeria in international
media regarding instability, and our own observations of falling oil prices while understanding
from scholastic backgrounds that International Political Economy is what is at play.
As a group, we have discussed several key topics that are generally known about
underrepresentation and oil in Nigeria. Nigeria is a major oil producing country and a member of
the Organization of Petroleum Exporting Countries (OPEC).1
Despite the vast oil wealth in
Nigeria, there is great economic inequality due to inequitable resource allocation.2
The lack of
just resource allocation has led to the underrepresentation of many groups within oil producing
communities, and has impacted their political and socioeconomic well-being. We also know that
1
Chris Nwachukwu Okeke. 2008. “The Second Scramble for Africa's Oil and Mineral Resources: Blessing or
Curse?” .International Lawyer. 42, no. 1. p. 200.
2
Chris Nwachukwu Okeke. ibid., p. 199.

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the Nigerian government has been accused of corruption. Another generally known fact is that
Nigeria was once colonized by Great Britain up until their independence in 1960.3
We have made one main assumption throughout our research of this topic: oil production
is, in itself, degrading to the environment. With that said, we will explain in more detail the
damage that is done by oil spills and gas flaring.4
However, we believe that the detailed
discussion of the harm caused by carbon emissions on a global scale is better left to the plethora
of existing literature specifically on that topic. At this juncture, we believe that this is the extent
of our assumptions. We have recognized that the other ideas that we thought we might be
assuming are actually going to be addressed in our research as we move forward.
In the areas that have great economic gains to be garnered from mineral or resource
mining, there are many dimensions to explore. There is often an associated favoritism of certain
shareholders and a neglected interest of undervalued stakeholders in these situations, typically a
socio-economic, ethnic, or political minority who goes unheard or unheeded. The political
systems in place have embedded social relations into their structures, sometimes referred to as
Godfatherism5
, which enables a politician to be chosen based on their strategic alliances and
promises to those who have helped them gain the position.6
It is the neglected groups which
require mobilization as civil society in order to have their interests advocated for, and which
must make sustained efforts to effectively partake in that processes of the planning and
extraction.7
Although some progress has been made, the detrimental environmental and social
effects of mining endeavors are partly due to the inability of communities to act as partners in
these projects and have their wisdom, interests, or input embodied.8
The relation between this
disregard and environmental degradation is what our group is hoping to explore through our
capstone research project. Our main research question is as follows: "In a country whose
economy has relied heavily on mineral resource extraction, how is the political and
3
Jesse Salah Ovadia. 2013. The Nigerian 'One Percent' and the Management of National Oil Wealth Through
Nigerian Content. Science & Society. 77, no. 3: 47-75.
4
C.O. Opukri, and Ibaba S. Ibaba. 2008. "Oil induced environmental degradation and internal population
displacement in the Nigeria’s Niger Delta’." Journal of Sustainable Development in Africa 10, no. 1: 173-193.
5
Okoye, I. 2007. "Political Godfatherism, Electoral Politics and Governance in Nigeria." In Annual Conference of
the Mpsa Held In Chicago, USA. p. 3
6
Sarah Chayes. 2015. Thieves of State: Why Corruption Threatens Global Security. WW Norton & Company:
pp.125-126
7
Julia Maxted. 2006. Exploitation of Energy Resources in Africa and the Consequences for Minority Rights.
Journal of Developing Societies. 22, no. 1. p. 35.
8
Julia Maxted. ibid.

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economic underrepresentation of local communities related to the presence of
environmental problems in the Niger Delta?"
In addition to the main research question and in order to comprehensively explore the
topic, other questions must be asked and researched. These questions include: How has
corruption in the government and unequal resource allocation contributed to underrepresentation
of local communities in the Niger Delta? How has the theft of crude oil impacted the
environment in the Niger Delta? What role does development, or lack there of, play in the
economy and underrepresentation in Nigeria? How does the environmental degradation of the
Niger Delta affect local populations? How do local politics and social movements in the Niger
Delta affect oil extraction in the region? How can the government encourage or discourage the
oil industry?
The purpose of our research is to explore these connections in a thorough manner and
obtain a greater understanding of the current circumstances in the Niger Delta. Our research has
the possibility of shedding light upon the crucial environmental leveraging points in the region,
across the continent and in other parts of the globe subjected to similar situations. We have the
opportunity to impact how others, in academic circles and in less formal arenas, may see both
underrepresentation and environmental issues in local and in global scopes. By providing an
inclusive contextual framework and a complementary perspective for viewing these themes, we
hope to be able to breakthrough the biases surrounding the African continent in popular
discourse and create a platform for future research, individual learning, and organizational action
to build upon.
2. Methodology and Research Design
In this section, we will discuss the approaches we chose in answering our research
question. We will also explain the process by which we chose our case study. The case we have
chosen is a single instrumental case9
–we can look at this case and use it as an example of a larger
problem plaguing many developing countries. The issue of the resource curse, environmental
degradation, and corruption are all issues that are by no means confined to the Niger Delta. For
this very reason, we have not classified this as an intrinsic case10
–we deem it not to be unique to
9
John W. Creswell. 2013. Qualitative inquiry and research design: Choosing among five approaches. Sage. p. 99
10
Creswell ibid., p. 100

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the region. However, an in-depth look at the situation in the Niger Delta could potentially be
generalizable to the greater issues of the resource curse, environmental degradation, and
corruption in other states around the world.
We have elected to narrow our research to a single case study as opposed to to a multiple
case study.11
Due to time constraints, our aim is to fully understand the situation in a single case,
rather than weaken our investigation through the task of examining multiple cases with
comparable depth. However, in a different setting, a multiple case study could illuminate
similarities between cases and provide additional data for future research. A single case study
will provide a substantial example to illustrate the multifarious character of our approach and to
produce solid findings that lend themselves as pattern-building for other works. The case of the
Ogoni people in the Niger Delta can be classified as what Alan Bryman would call an
exemplifying case–it demonstrates the circumstances of a situation prevalent around the world.12
This classification also makes a justification for the implementation of a single-case study. We
are approaching this study by applying a holistic analysis, rather than an embedded analysis,13
because there will not be a focus on a particular subunit within this case. Rather, we will be
examining this case entire case in a more general way.
We will be using complex reasoning for our research, applying inductive reasoning to
reach conclusions about information gathered, as well as using deductive reasoning to construct
themes and compare them with data collected.14
As Creswell suggests, we will be using multiple
methods for our research.15
Forms of data will include secondary sources such as books and peer
reviewed articles, as well as reliable sources from news outlets. By using multiple sources, we
can triangulate evidence and remove any inconsistencies presented in single-source data. The
validity of these document sources have been investigated by our group through the critical
examination of primary sources for first-hand account evidence, and secondary sources to
reiterate main points we make, and find differing points of view. Tertiary sources will only be
used to remain up to date on current activities occurring in the Niger Delta.16
We have been
11
12
Alan Bryman. 2008. Social Research Methods. Oxford University Press. p. 56
13
Creswell op. cit., pp. 100-101
14
15
Creswell ibid.
16
Kate L. Turabian. 2013. A Manual for Writers of Research Papers, Theses, and Dissertations. University of
Chicago Press. pp. 25-27

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adamant to use the works of respected field experts, university-affiliated professors, reliable local
organizations, and other credible authors who are part of reputable publishers and institutions.
2.1 Approaches
We are using an emergent design for this research paper; in other words, as we accrue
information and gather an increasing understanding of the topic, our research plan will evolve
accordingly.17
Our intent is to produce a paper that is credible, transferable, dependable and
confirmable.18
To ensure a final work that has internal validity, our explanation of the causal
effects will show a strong relationship between the independent variable of government activity
and the dependent variables of environmental degradation and underrepresention.19
External
validity will be established through our global framework which reflects upon the greater
application of findings from this common case, and ecological validity will be addressed through
the localized analysis of how indigenous groups are affected daily by the reality of their
situation.20
Constructing comprehensive qualitative research requires an awareness of researcher
roles in interpretation and the involvement of natural viewpoints which are “sensitive” to the
subjects being considered.21
A quantitative approach is unable to capture the intricacies of people
on the ground who are experiencing their lives within such a living, breathing context. Our data
is no less credible than numbers and because our focus is on the well being of humanity, the
situation may provide a more suitable occasion for analysis using epistemologies like social
constructivism rather than more rigid or reductionist methods like postpositivism.22
The
interpretivism embodied in our research is a logic utilized to seek an understanding of the
experience for marginalized communities rather than only looking for confined explanations of
the situation in the Niger Delta removed from human ascription. The subjects of our analysis are
essential to the hermeneutic approach we plan to employ; the hermeneutic approach recognizes
the significance of individual thought and processes that may impact a situation or
environment.23
Through the interpretation of data from the perspective of participants, we
17
Creswell op. cit., p. 47
18
Bryman. op. cit.,. p. 34
19
Bryman ibid., p. 32
20
Bryman ibid., p. 33
21
Creswell. op. cit., p. 44
22
Creswell. ibid., p. 24
23
Bryman. op. cit., p. 15

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acknowledge that our subjectivity may be a source of analysis but we will actively make it a
point to convey the meanings of our research by people actually living the experiences we
describe.
Upon a group reflection, we have discovered several predispositions engendered by our
academic and social experience which may lead to a perspective on the topic that differs from
those of other researchers. One major potential partiality is our feelings about the prospect of oil;
we all agree that the production of oil is a dead end road that should not gather continuing
investments in the future. For this reason, our perspective on oil production, and thus, the issue
of environmental degradation as a result of said production, may inherently be perceived as
negative. The other main potential bias which might be found in our research paper is that we are
all partial to local perspectives over foreign or corporate perspectives. For this reason, our
perception of conflicts between the two may lean towards favorable outcomes for local
communities. Our feelings on these topics stem primarily from our academic background. The
lifeblood of the Global Studies major is the desire for the understanding of global issues. Three
of our members have a concentration in global environmental policy. Thus, environmental
degradation is a sensitive subject. The fourth member of our group has a concentration on social,
political, and economic development of developing nations, so naturally, conflicts between local
communities and outside forces are of particular concern. These are the two main biases among
our group.
With that said, we will apply a holistic account24
–we will make it a priority to
acknowledge and address the various perspectives in this complex case in order to help us
understand the situation as a whole. These ethical leanings are situated within a research format
which applies a constructivist approach, meaning that we recognize how the significance and
understanding of situations are socially constructed by individuals as well as researchers, and we
have left our questions intentionally open in order to receive a more varied response from all
angles.25
We will analyze the relevance of theories that build our framework as well as those that
disagree with it in order to cultivate an objective outlook. The avenues mentioned will elucidate
24
Creswell. op. cit., p. 47
25
Creswell. ibid., p.24

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the exploration of our case with multiple perspectives without shaping our understanding in a
narrow direction colored by purely personal views.26
2.2 Case Boundaries
The boundaries of our study manifest in different levels according to our specific
research concentrations: social, environmental, economic, and political. The social dimensions of
our study will refer to the Ogoni ethnic group, local activists and other stakeholders living within
the Niger Delta in Nigeria. Because of the nature of interstate networks and connections, we
cannot confine our research of the Ogoni to a solitary spatial zone, despite the existence of an
area designated as Ogoniland. Instead, we have chosen to stipulate our social realm as the entire
Niger Delta, a relatively small, 70,000 km²27
portion of the state of Nigeria located where the
mouth of the Niger River meets the Atlantic Ocean. The environmental element of our research
will arrange itself within the region of the Niger Delta and its surrounding bodies of water
affected by Niger Delta oil activity. Our choice to limit the environmental aspects in this manner
allows for our work to spotlight the problems incurred by oil extraction, and not other industries,
and the difficulties endured by oil producing communities, not other localities which may have a
smaller impact from resource extraction practices. To the extent possible, we will attempt to
focus our research on the Niger Delta explicitly to provide an unambiguous insight into the
current situation. This being noted, we also recognize that the range of economic and political
circumstances in the Delta is greatly impacted by the actions of the national government. Hence,
for these intertwining yet separate realms of analysis, economy and politics, we will widen our
scope to the federal level and delineate our restrictions to the conduct of the Nigerian
government, institutions and markets.
In regards to temporal limitations, the scope of the case study will be limited to the last
twenty years–the time following Ken Saro-Wiwa’s death. We will look at changes and
developments in the political and economic status of the Ogoni people from 1996 onward, while
comparing it to changes in environmental degradation in the area over the same time period. The
focus, though, will be more on recent years than in the few years immediately following Saro-
Wiwa’s death. This paper will reference the history of oil in Nigeria, starting at its discovery in
26
Creswell. ibid., p. 60
27
World Wildlife Foundation. 2015. Niger River Delta.

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1956, to encompass the full connotation of what has occurred over time. We feel it is important
to look at the past in order to understand the present situation in the Niger Delta. The colonial
context and continuous accounts of exploitation provide a more nuanced discernment of current
conditions, and demonstrate why communities have felt the need to organize against oil
extraction as their needs have been relentlessly ignored.28
This historical information will be
used exclusively for the purpose of providing background. We have placed these spatial and
temporal limitations for our case study, but we will relate our findings to their significance in a
global setting in our paper.
Our decision to research this topic was driven by our curiosity to delve into one of the
most highly politicized commodities of the global market: oil. Industrialized nations consume
this nonrenewable resource at a rapid rate, wars have been fought, and local people conveniently
forgotten in order to procure this commodity.29
We have collectively chosen to explore the
ongoing struggle for environmental, social, and economic justice in the face of transnational oil
corporations and corrupt governments in the Niger Delta through the example of the Ogoni
people. Our decision stems from the immense level of activity that has occurred in Ogoniland for
decades and the inspiration that has come from learning about the tragedy surrounding Ken Saro-
Wiwa and the execution of the Ogoni Nine which gained global infamy in 1995.30
This ethnic
group has become a focal point within the Niger Delta and a representation of what can go awry
when local peoples endeavor to achieve equality within an unequal system. The Ogoni people
have remained active in the Niger Delta as they continue to demand agency regarding their lands
and livelihoods.31
2.3 Frameworks
For the qualitative research indicative of social sciences like Global Studies, the
perspective of the various participants are essential to include and strengthen the work’s worth in
the wider world.32
In the instance of our specific research case the topic in question is the
underrepresentation of local groups in the Niger Delta and so the largest mistake we could make
28
Maxted. op. cit., p. 33.
29
Julia Maxted. ibid., p. 29.
30
Human Rights Watch. 1996. Nigeria Permanent Transition 1996.
31
Movement for the Survival of the Ogoni People. 2015.
32
Creswell op. cit., p. 47

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would be to leave out the voices we have found that need to be heard. Because we have not had
the opportunity to travel to Nigeria and observe these circumstances first-hand, we cannot speak
from a place of understanding in the way indigenous people of the area are able to. The meaning
given and interpretations ascribed to the occurrences in the Delta are most significant when they
are provided by those participating in the struggle and advocacy discussed. Stakeholders in the
extraction of natural resources in the Niger Delta are multi-level and include: both local and
national governments and politicians, state judiciary structures, transnational oil corporations,
international bodies, non-governmental organizations, state civil society, and local communities
of the Niger Delta that include individuals such as activists, militants, and agrarians. Each
contributor plays a significant role in either the perpetuation or prevention of harmful systems.
As parties with different concerns, they do not always agree on strategies or even goals. Some
citizens have been assimilated into the current markets in a sustainable way but some
communities have also been taken advantage of and had to defend their rights to land, livelihood
and life from the encroachment of multinational corporations, government mandates and
interests that do not represent them.
Our research has been guided under a series of related frameworks such as political
ecology33
and the resource curse.34
Political ecology is a complex term, the meaning of which we
have gathered from Garry Peterson. Peterson defines political ecology as “combining the
concerns of ecology and political economy that together represent an ever-changing dynamic
tension between ecological and human change, and between diverse groups within society at
scales from the local individual to the Earth as a whole.”35
This framework will provide a path of
multidimensional understanding as it relates to our study and the heavy leverage that politics
have upon an environment. The resource curse which has been outlined by Michael Ross will be
an important aspect of our analysis as we explore how the economic climate of the Niger Delta
can impact the political circumstances in local communities.36
The resource curse can be
described as an instance in which states who have incredible wealth in the form of natural
resources are adversely affected by this plenty through a subsequent narrowed focus of policies,
33
Garry Peterson. 2000. "Political Ecology and Ecological Resilience:: An Integration of Human and Ecological
Dynamics." Ecological Economics 35, no. 3: 323-336.
34
Michael L. Ross. 1999. "The Political Economy of the Resource Curse." World politics 51, no. 02. p. 298.
35
Peterson. op. cit.
36
Ross. op. cit.

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resulting in nonreciprocal economic remunerations and therefore a slower route to sustainable
development. The framework of the resource curse is useful for our research because of its direct
relation to the circumstances of extraction-concentrated economies in a developing country like
Nigeria. It is also useful for the illustration of the consequences borne by oil producing
communities who do not receive equitable compensation for their land productivity and who
instead bear political, social, and environmental costs.
2.4 Key Terms
There are several key terms that we wish to define, as they will appear frequently
throughout this paper. The first key term is corruption. It is a common word, but a clear
description of how we interpret it will be beneficial. By corruption, normally referring to
government corruption, we mean the illegal and intentionally secret behavior that leads to
personal gain at the cost of society as a whole, often in terms of public revenues. Kleptocracy is
synonymous with our working definition of corruption, and is a term that may be used
throughout the paper to refer to this phenomenon. The next key term is environmental
degradation. By this we mean anthropogenic damage to air, land, water, and the ecosystems that
benefit from them. Another key term is underrepresentation. In this context, underrepresentation
means the lack of a proportional contribution to decision-making regarding social, political,
economic and environmental matters. A word we will use synonymously with
underrepresentation is exclusion. We are using these words with intent, and define them in a
specific fashion, because these concepts are the essence of our research and will arise frequently
throughout this paper. They are the most indispensable terms in our study, and it is important for
the reader to be able to clearly understand our meaning of these terms as our study unfolds.
3. Literature Review
3.1.The Resource Curse
Our two frameworks, political ecology and the resource curse, have guided us in our
exploration of applicable literature. We will be able to explore a variety of works by experts in
these fields, along with different perspectives concerning the circumstances which the country of

20
Nigeria is facing, in order to enhance our understanding and capacity to critically assess those
circumstances properly.
Chris Nwachukwu Okeke, an accomplished Nigerian professor who has been the dean of
two Faculties of Law at Nigerian institutions, calls the present day foreign presence in Africa the
“Second Scramble”, a reference equating the colonial era of infiltration and imperialism of
African lands to the “modern oil craze” of Western countries and corporations.37
The association
of these two time periods has the suggestion of immense exploitation, though the second round
has the central difference of increased private sector and international financial institution
involvement. Also, compared to the first round which was comprised of mainly government
action, the clamber is grasping for not only physical minerals but the control of state-owned
enterprises of African administrations as well. Despite the escalation of investment in the natural
extraction industry by affluent transnational companies, “little of the proceeds from the oil
wealth eventually get to the majority of the people who need help most.”38
This manipulation is echoed in Julia Maxted’s article, which covers multiple cases across
Africa and has an entire section on the situation occurring in Nigeria. Similar to Okeke, she
states that there is a “current scramble” for African resources, especially those necessary to
generate power, and that this “new imperialism” has left the social, economic, environmental,
health, and human rights issues of local communities in the Niger Delta “unfulfilled”.39
Influential state economies such as those of the United States depend heavily on oil for the
maintenance of their public and private lifestyles, including an increasingly large percentage
imported from West African states like Nigeria so as to lessen their reliance on states from the
contentious Middle East.40
Despite this growing demand and income accrued by the Nigerian
Federal Government, basic needs are not met in Nigerian communities such as potable water
sources, viable opportunities for livelihoods, and functional health or educational facilities,
particularly those in the Delta who were promised development by oil companies. This is blamed
on the prevalence of corruption and the equivocal reports on profits and local apportionment by
state administrations, the Niger Delta Development Commission (NDDC) and international
37
Okeke. op. cit., p. 194.
38
Okeke. ibid., p. 199.
39
Maxted. op. cit.
40
Maxted. ibid. p. 29.

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extraction corporations.41
Maxted emphasizes the damage done to Nigerian communities facing
prevailing transnational corporations who consistently leave the population out of essential
decision-making processes about their own land. As Section 7 of the Environmental Impact
Assessment Decree states, “before the Agency gives a decision on an activity … the Agency
shall give opportunity to government agencies, members of the public, experts in any relevant
discipline and interested groups to make comment on environmental impact assessment of the
activity.”42
Regrettably, tactics are utilized that make public participation of indigenous
communities difficult, traditional political structures are obstructed with policies of ‘divide and
conquer’, and violent strategies have been employed in order to quell voices of protest in areas of
unrest.43
Modern linkages between the governments of less developed nations and the commercial
interests of foreign states, which benefit both foreign powers and local elites more than
indigenous populations, demonstrate how state resources and policies disregard local interests.
The influence of multinational oil companies on economies is strong in the region but the
situation has also taken on a local quality in which extraction is supported by elite politicians and
officials who stand to gain personally from agreements and unenforced laws.44
This perspective
is helpful to our analysis because it encourages a critical view of the actions undertaken by
natural extraction industries and the governments who allow them to operate in their territories
by framing those arrangements with the historical continuation of profits bought at the cost of
human well being. This outlook is necessary to transcend other vested arguments which state that
certain economic practices are for the betterment of all; we have seen through our research and
through the lens of local peoples that this is not the case.
A foundational framework within our research has been the resource curse, which has
been a major part of the international discourse since the 1990s, though it has been building in
backgrounds since the 1970s.45
Scholars such as Michael Ross and Terry Lynn Karl have
elucidated the resource curse, which is also called the “paradox of plenty” and the “King Midas
problem” considering the juxtaposition of natural wealth and economic poverty within some
41
Maxted. ibid. p. 34.
42
International Centre for Nigerian Law. 1992. "Environmental Impact Assessment Decree No. 86 1992."
43
Maxted. op. cit., p. 34.
44
Terry Lynn Karl. 2005. "2. Understanding the Resource Curse." Covering Oil. Open Society Institute, New York.
p. 116.
45
Angela V. Carter. "Escaping the resource curse." Canadian Journal of Political Science 41, no. 01. p. 216.

22
states.46
In Ross’ pioneering article “The Political Economy of the Resource Curse”, he
addresses the strong indications that countries which depend heavily upon the extraction of a
single resource have a correlative and corrosive relationship with myopic economic strategies.
He claims a few reasons for the presence of the resource curse which fall into either the political
realm or economic realm. When he wrote this article in 1999, Ross found that of the countries
that were immensely in debt and impoverished, 27 out of 36 had economies concentrated on
natural resource extraction.47
Economic causes include volatile world markets, deteriorated trade provisions for natural
resources, “Dutch Disease” and the feeble support among multiple sectors of the economy.48
Political explanations for detriment involve the poor capacity of government leaders to see
beyond the momentary riches to be made, plans that ignore the property rights of locals, policies
that encourage the depletion of resources, and the creation of unaccountable rentier states.49
A
rentier state is one which “lives from the profits of oil,” or other locally-situated natural
resources sold to foreign powers, to a significant extent for its economic stability.50
Because of
this concentrated income a dynamic can arise that blends political action and economic policy to
a indiscernible and convoluted point. The Mahdavy commentary found in Ross postulated that
rentier states damage democracy as the dependence of governments on primary commodity
exportation to bolster coffers left them unconcerned with attempts to gather taxes for revenue,
and hence allowed them to remain unanswerable to the people of the state.51
When governments
become uncaring about their citizens, violence can erupt from clashes with public soldiers,
especially when locals attempt to assert their agency. Nigeria is listed as one of the countries
where “the rest of the economy, and the rule of law, have largely broken down” due to causes
such as those of the political and economic dimensions mentioned above.52
Karl aims to help readers in comprehending the resource curse and its manifestations by
first defining what it is not, and then by the parameters of what it is. The resource curse is
explained to not be an idea subject to the fluctuating misconceptions which surround it. Some
46
Karl. op. cit., p. 21.
47
Ross. op. cit., p. 322.
48
Ross. ibid., p. 306.
49
Ross. ibid., p. 308.
50
51
Ross. op. cit., p. 312.
52
Ross. ibid. p. 321.

23
interpretations conceive that the unfortunate effects of the resource curse, such as substandard
rates of social well-being, are endured by any state with any amount of natural abundance. In this
article Karl discusses the numerous societal ailments that accompany the failing policies of
struggling extraction states, generating environmental degradation, poverty, and intolerable
health conditions for local communities.53
But, contrary to the idea that all natural commodities are an offense, states without a
substantial economic concentration on extraction do not suffer from the same consequences as
those that do. She clarifies the confusion of the term by mentioning that “in its narrowest form,
the resource curse refers to the inverse relationship between high natural resource dependence
and economic growth rates.”54
Reliance is typically demarcated by comparing the proportion of
primary resource exports to the aggregate state exports; if these amounts show that oil or other
extracted resources account for 60 to 95 percent of all state exports then the state is considered
dependent.55
Her work has found that “oil- and mineral-driven resource-rich countries are among
the weakest growth performers, despite the fact that they have high investment and import
capacity”56
and the “crux of the problem” is found in the incapable structures of governance.57
She asks a provoking question in her article that highlights the unequal standing of developed
and developing countries on the world stage: “If sophisticated governments in the more
developed world have trouble executing ambitious interventionist policies, how can governments
in less developed countries be expected to administer even more ambitious and complicated
policies?”58
This leaning on natural resources is in agreement with Ross by identifying it as a result of
rentier states, but differs in outlook by commenting that “not all resources are created equal.”59
Oil is one of the resources considered a specialty “‘point source’” export because of its origins in
constricted geological and fiscal jurisdictions.60
For countries which “[look] powerful but [are]
hollow” the democratic will of the people is subverted beneath the material aspirations of
53
54
Karl. ibid., p. 23.
55
Karl. ibid. p. 22.
56
Karl. ibid. p. 23.
57
Karl. ibid. p. 25.
58
Karl. ibid.
59
Karl. ibid. p. 23.
60
Karl. ibid.

24
government officials who aim to personally profit from the state’s natural oil endowment.61
The
corruption that arises from the shadows of greed and mismanagement have come characterize
many resource-wealthy, economically poor countries like Nigeria, and led to the present
deplorable situation in local communities of the Niger Delta.62
Authors like Karl often speak of a “reality” where “countries that depend on oil for their
livelihood are among the most economically troubled, the most authoritarian, and the most
conflict-ridden in the world”, but these absolute insinuations are challenged by other studies in
the field.63
In the research conducted by Stephen Haber and Victor Menaldo, the affiliation
between authoritarianism and primary resource exporters is calculated. Through the design of
numerous models and tests which account for variable factors in 168 countries with data ranging
from the years 1800 to 2006, they strive to determine how polity has altered in times before and
after production.64
With the assortment of differing states, results were categorized by the
strength of the association and many were surprisingly recognized as having democratic
circumstances improve once financial prosperity was acquired through natural resource exports.
Nigeria is classified as an inconclusive C category: Neither Blessed nor Cursed, which denotes
the absence of evidence for a significant pattern of autocratic politics before exportation that
would indicate resource reliance as the cause of dictatorial governments.65
We found this result
surprising as the history of Nigerian government constitutes a picture of inveterate
authoritarianism and military rule that has existed for the majority of time since independence
and throughout its dealings with mineral extraction. When Olusegun Obasanjo came to office in
1979 he installed an election format and a small stint of civilian rule lasted from 1979 to 1983,
but then domineering coups re-emerged and continued until 1999 when civilian rule was again
restored and Olusegun Obasanjo became the first democratic elected official voted into the
presidency of Nigeria.66
With this timeline demonstrating Nigerian polity, the uncertain
impression imparted by Haber and Menaldo seems unsuitable for the reality of past political
patterns in Nigeria and their study did not account for these features in a practical way.
61
Karl. ibid. p. 25.
62
Karl. ibid.
63
Karl. ibid. p. 21.
64
Stephen Haber and Victor Menaldo. 2011. "Do Natural Resources Fuel Authoritarianism? A Reappraisal of the
Resource Curse." American Political Science Review 105, no. 01: 1-26.
65
Haber and Menaldo. ibid.
66
Reuters. 2011. “Timeline: Nigeria's road to democracy.”

25
While they conclude that the assumption of the ties among the resource curse and
tyrannical regimes are more about correlation than causation in most cases, the “resource
blessing” proposed for some states is characterized to be, in fact, quite minimal.67
They even
suggest that “the weight of the evidence indicates that scholars might want to reconsider the idea
that there is a resource curse.”68
The authors’ capacity to troubleshoot strange outcomes drives
them to run assessments for a multitude of scenarios, but also admit to their own shortcomings
such as the difficulty of allowing for conditions like revenues supporting dictatorships afterward
or how weak states may be prior to the introduction of natural resource trade. These authors are
rigorous in their methods, but the lack of definite quality to such quantitative data leaves readers
wondering how applicable their conclusions are. It can be understood that not all cases of
resource wealth have a direct consequence of autocracy, but these findings don’t reveal much
about the actuality of current situations in states who are resource reliant and non-representative.
When they state that there may not be a resource curse, they do not provide an alternative
approach to understanding the correlation that they agree upon with other scholars. Although we
agree on the uncertain nature of social research, we have chosen to place our trust in a larger
body of academic work and believe that the resource curse is an actuality in resource-reliant
states.
3.2 Corruption
Government corruption is, and historically has been, a prominent issue in Nigeria. O.T.
Omololu points out that corruption is demonstrated in every aspect of government.69
The aspect
that will dominate our research is public revenues. The Government of Nigeria has a reputation
for allowing large sums of money to vanish. Accusations and charges of various politicians have
materialized, but the issue of embezzlement remains. Richard A. Joseph also tackles this topic.
Joseph uses the term “prebendalism” to explain this phenomenon. Joseph describes the term
“prebendal” to “refer to patterns of political [behavior] which rest on the justifying principle that
such offices should be competed for and then utilized for the personal benefit of office holders as
67
68
69
Omolulu. ibid., p.31

26
well as of their reference or support group.”70
In other words, prebendal politics is a scenario
where the motive for becoming a politician is the monetary gain to be had. Granted, Joseph does
not explicitly state that the “personal benefit” from holding a position in office is a monetary
one, but the examples of alleged embezzlement are rampant. He goes on to explain that the
(ideally) primary use of the office tends to be neglected in a prebendal situation; the focus is the
pursuit of financial gain, and the importance of justice and order is forgotten.71
Omololu cites the National Planning Commission, who claims that corruption and poor
transparency have helped to stifle development. He notes how poorly Nigeria ranks in terms of
corruption according to Transparency International. As of 2014, Nigeria ranked 136th in the
Corruption Perceptions Index out of 175 countries ranked.72
This is an improvement from the
2007 rank of 147 out of 179.73
With that said, these rankings change each year–for example, in
2008, Nigeria jumped up to a rank of 121st out of 180,74
and then back to 130th out of 180
countries ranked in 2009.75
Thus, we are not necessarily seeing a pattern of improvement, but
rather merely small shifts not associated with any major governmental improvements. The one
consistent pattern is that Nigeria remains in the bottom half of the world in terms of
transparency. Omololu specifically notes fraudulent trade, bribery, and abuse of office, among
others, as problematic forms of corruption in Nigeria. Embezzlement may fall under the umbrella
of abuse of office, and there have been plenty of charges of politicians concerning stolen public
revenues.
Omololu claims that “corruption and bad governance” were the main justifications for the
military when they decided to step into governmental power in Nigeria in 1966. Ironically, the
military rule showcased a similar amount, if not a greater amount, of corruption76
–an idea that
was similarly explained by Joseph.77
Eventually, Omololu believes, corruption became the norm.
What came with this standard of government was a stagnation of development and a drop-off in
70
Richard A Joseph. “Democracy and prebendal politics in Nigeria.” Vol. 56. Cambridge University Press, 2014.
p. 8
71
Joseph. ibid.
72
Transparency International. Corruption Perceptions Index 2014.
73
74
75
76
Omololu. op. cit., p.31
77
Joseph. op. cit., p.70

27
education.78
The recurring point that Omololu makes throughout this paper is that corruption in
Nigeria has been the cause for a lack of any development whatsoever. Furthermore, it has also
exacerbated the issue of political instability in the country.
Sarah Chayes, author of Thieves of State: Why Corruption Threatens Global Security,
has some interesting notions that are valuable inclusions in our discussion. Chayes considers the
1980s, when major growth in oil production occurs, as “the first tipping point on the road to
acute, systemic corruption.”79
Chayes ties corruption tightly with the growth of oil production in
Nigeria. She goes on to note, as Omololu also noted, that while oil production has produced so
much wealth, social developments like education and healthcare have not grown at a
proportional rate. Chayes also notes that average income is lagging as well. She explains that the
wealth from oil production is shared between the federal government and each state government,
as well as hundreds of local governments. But this does not do as much good for the state and
local governments as it should, because not all of the wealth ends up being accounted for, she
explains. She includes some stifling numbers: total sales of crude oil between January 2012 and
July of 2013 were missing an estimated US $11 billion, with one estimate of the missing funds to
actually be near US $20 billion. Chayes’ findings imply that President Goodluck Johnathan is
linked to corrupt practices.80
With all of these political issues, Chayes mentions that the
agriculture industry in Nigeria has been troublingly stagnant over the last several decades. She
refers to Nigeria as an “oil ‘monoculture,’” pointing out that the manufacturing industry has also
slowed down, and as such, the oil industry overshadows all others. According to Chayes,
senators in Nigeria make over a million dollars each year, not including any money that may or
may not have been embezzled.
Chayes identifies a second tipping point of corruption in Nigeria’s history: the switch to
civilian rule in 1999. Chayes points out the irony that the first tipping point was partly driven by
the lack of accountability caused by military rule in the 1980s.81
Corruption in a civilian
government as well as a military government makes for a dilemma that must be acknowledged
when discussing solutions for the problem of corruption in Nigeria.
78
Omololu. op. cit.
79
Sarah Chayes. 2015. Thieves of State: Why Corruption Threatens Global Security. WW Norton & Company:
p.122
80
President Johnathan will be in office until May of 2015, just after the completion of our paper. The successor,
President Muhammadu Buhari, will not make his way into our study as acting president.
81
Chayes. ibid., pp.122-125

28
It is perplexing that civilian rule can accommodate a level of corruption similar to that of
military rule, but one unquestionable contributor to corruption in a democratically ruled Nigeria
is election rigging. Christian Opukri contributes information about election rigging in his paper
titled “Electoral Crisis and Democracy in Nigeria.” According to Opukri, all the elections that
have taken place in Nigeria since it became independent have been controversial.82
Joseph gives
a similar attestation regarding Nigerian elections.83
Opukri also states, not unlike Chayes, that,
“[while] the many years of military rule are significant, the years of democratic governance are
perhaps more significant, due to the near total lack of democratic values and principles in
governance.”84
This is similar to Chayes’ argument, which is essentially that the beginning of
civilian rule–her “second tipping point” –is at the very least comparable to, if not more
significant than, the growth of oil production, which coincided with military rule as a landmark
for corruption. The only difference is that Opukri does not specify the point of oil production
growth; he merely compares the time of military rule to the time of civilian rule. Opukri
expresses the importance of elections to a democratic system, and that election rigging has run
rampant in Nigeria, and, essentially, because of this, democracy has been compromised.85
He
points out the 2003 elections specifically as an example: 42 different forms of rigging were
recognized. These forms of election rigging varied widely; all were reprehensible, and some used
the threat of violence.86
As a result of the corrupt election, several political parties refused to
accept the results as legitimate.87
The 2007 election is his second example of an illegitimate
election. He draws attention to the failure of some polling stations to ever open at all, as well as
others having shortened hours of operation. The list of 2007 polling flaws goes on, once again
including violent behavior. Opukri indicates that these practices convinced voters that their
participation was irrelevant.88
Chayes describes this situation in the same way, noting the
violence associated with the elections as well as the consequential decrease in participation.89
Opukri goes on to note the overwhelming official results of the 2007 presidential elections.
82
Christian O. Opukri. 2013. "Electoral Crisis and Democracy in Nigeria." Journal of Research in National
Development 10, no. 3: pp. 178-187
83
Joseph. op. cit., p. 171
84
Opukri. ibid., p. 180
85
Opukri. ibid.
86
Opukri. ibid.
87
Opukri. ibid., p. 181
88
Opukri. ibid., pp. 181-182
89
Chayes. op. cit., p. 126

29
Perhaps the most important aspect (as it pertains to our study) of Opukri’s entire paper is his
explanation of the relevance of ethnicity. He argues, “It is an acknowledged fact that the
Nigerian electoral system is tainted by ethnic considerations and to claim that some of these
ethnic leaders scored no more than a few thousand votes even in the states and backyards where
their ethnic majority commands the electoral stakes is hard to believe.”90
To put it in a different
way, Opukri is noting that these rigged elections are making it so that certain ethnic groups’
votes are not being counted. This point is of the utmost relevance to our research. The corruption
present in Nigeria is marginalizing certain ethnic groups.91
The term political ecology has been around since the 1970s “as a way of thinking about
questions of access and control over resources … and how this [is] indispensable for
understanding both the forms and geography of environmental disturbance and degradation, and
the prospects for green and sustainable alternatives.”92
According to Richard Peet and Michael
Watts, political ecology is a combination of ecological concerns with those of political economy.
As a result, political ecology provides a perspective that includes the discussion of communities
as well as natural resources.93
These authors use this lens to examine the situation in Nigeria. They point out the
tremendous amount of wealth generated from oil, and compare it to the per capita annual
income, which (as of 2004) was US $290. The point that they are trying to make is that the
amount of oil wealth generated should translate to a wealthier society, but such a translation has
been lacking. They also point out the estimate of about US $50 billion that has “disappeared”
from government revenues as well, implying issues with corruption. Not surprisingly, they claim
that living standards have not improved over a span of 44 years–from Nigeria’s independence to
the time of publishing.94
Furthermore, they make the claim that the oil producing communities
“have benefited the least from oil-wealth.”95
Lastly, these communities, which are all in the
90
Opukri. op. cit., p. 184(1)
91
Opukri. ibid.
92
Richard Peet and Michael Watts. 2004. “Liberation Ecologies: Environment, Development, Social Movements.”
p. 6
93
Peet & Watts. ibid., p. 7
94
Peet & Watts. ibid., pp. 274-275
95
Peet & Watts. ibid., p. 275

30
Niger Delta, suffer the consequences of oil spills and gas flaring, which occur at a greater rate
than anywhere else in the world. These authors make it clear that Niger Deltans suffer from
“marginalization” and “neglect”.96
3.4 Local People of the Niger Delta and Oil
Ken Saro-Wiwa was an activist working for justice of the Ogoni people in regards to
issues surrounding the production of oil. He was dedicated to a non-violent movement for
ecological and and social justice, which ultimately resulted in the creation of the Movement for
the Survival of the Ogoni People (MOSOP).97
In 1994 Ken Saro-Wiwa along with eight others,
who together formed the Ogoni Nine, were arrested for the involvement in the murder of Ogoni
leaders. After eight months of imprisonment without access to lawyers, medical care, or family
members the Ogoni Nine were brought before a special tribunal. In October 1995 the Ogoni Nine
were sentenced to death then executed in November of 1995. MOSOP continues to work for
justice under the original vision of Saro-Wiwa. 98
A major aspect of our research is to develop an understanding concerning the relationship
between the extraction of oil and the local people of the Niger Delta. “Oil Conflict and
Accumulation Politics in Nigeria” written by Kenneth Omeje begins with an overview of the
history of oil and conflict in the Niger Delta. It details important facts regarding where the
transnational oil companies (TNOCs) operate and whom the companies affect. The article also
provides some details on the politics of Nigeria and who is benefiting from the oil profits99
.
Other articles do not tend to provide as much basic background information and we believe it is
an important aspect in understanding the complex relationship between local people and TNOCs.
While this article centers on local ethnic groups generally, “Shell, Nigeria and the Ogoni:
A Study in Unsustainable Development I” written by Richard Boele, Heike Fabig and David
Wheeler, is focused on the Ogoni people specifically. The Ogoni people are the main ethnic
group that we are researching because they are still currently active in conflict with oil
companies. Although Omeje’s article has general background information, this article details the
history of oil extraction specific to the Ogoni people. This article concentrates on the
96
Peet & Watts. ibid.
97
Remember Saro-Wiwa. 2014. “The Life of Ken Saro-Wiwa.”
98
Movement for the Survival of the Ogoni People. 2015. “Ogoni”
99
Kenneth Omeje. 2006-2007.“Oil Conflict and Accumulation Politics in Nigeria” ECSP Report: Issue 12: pp. 44-
49.

31
environmental issues that have come with the rise in oil extraction. It also explains how the
conflict lead to the execution of Ken Sara-Wiwa and the Ogoni Nine, which was a factor in our
group choosing to focus on the Ogoni people.100
The article written by Boele et al. also outlines the lack of, and need for, sustainable
development. This is a very important issue for the Ogoni people as well as other local
communities.101
Another article discussing local peoples, written by Gabriel Eweje, also
highlights the need for sustainable development. The article argues that development is the
responsibility of the multinational enterprises and they are both socially and economically
responsible for the development to be sustainable.102
Omeje also claims that if the state fails to
aid communities in development it is the obligation of oil companies to provide this aid.103
While
we believe that the state should be responsible for development and there is a need for
sustainable development, we agree that should the state fail, oil companies should be held
responsible, to an extent. Given that oil companies have such a large presence and effect on
communities, they should provide some aid in the development of communities.
Omeje’s article refers to transnational oil companies, however the article by Boele et al.
specifically references the Shell Petroleum Development Company (SPDC), and the article by
Eweje discusses multinational enterprises (MNEs) and multinational oil companies (MOCs). It is
important to recognize and separate what each article is referring to and the differences between
each. Multinational enterprises is the broadest of these terms and includes oil companies as well
as other companies.104
Omeje gives examples of TNOCs such as Royal Dutch Shell,
ExxonMobile, and ChevronTexaco,105
indicating that TNOCs can include any oil company
working in Nigeria. Multinational oil companies are essentially the same thing as transnational
oil companies. SPDC is a single company operating in Nigeria but can be considered a TNOC,
MOC and a MNE.
100
Richard Boele, Heike Fabig, and David Wheeler. 2001. "Shell, Nigeria and the Ogoni: A Study in
Unsustainable Development I.” Sustainable Development 9, no. 2: pp. 74-86.
101
Boele. ibid.
102
Gabriel Eweje. 2007. "Multinational Oil Companies' CSR Initiatives in Nigeria: The Scepticism of
Stakeholders in Host Communities." Managerial Law 49, no. 5/6: 218-235.
103
Boele, op. cit., p.45
104
Eweje, op. cit., p.218-219
105
Omeje. op. cit.

32
All three articles bring up the issue of local people not seeing any of the benefits from the
extraction and production of oil. Omeje states that despite Nigeria’s oil resources, 80 percent of
the revenues only benefit 1 percent of the population and 70 percent of the population lives in
poverty, off of less than US $1 a day.106
Boele et al. state that revenue distribution is an issue for
many communities including the Ogoni people. The vast majority of the revenue went to the
state government whose responsibility was to distribute the wealth, but most communities never
saw these benefits.107
Since 1999, the 13% derivation principle states that no less than 13% of oil
revenue must go to the oil producing state. As of the year 2000 this revenue refers only to on-
shore oil production. The remaining 87% of revenue would go to the central government, which
could be distributed to other regions.108
Although this has been the practice since the 1999
Constitution, there has been dissatisfaction among oil producing communities regarding the
allocation of funds. There is a call from several communities for the creation of national and
state derivation committees to properly manage the funds.109
Eweje goes on the argue that local
communities have the right to other benefits such as social services, welfare programs, and
community development programs but never saw such benefits.110
Each article makes the point
that local communities are suffering from consequences of oil extraction without receiving any
benefits.
3.5 Oil Industry and the Environment
While we will be focusing on more present issues related to the Nigerian oil industry, it is
important to look at the history of Nigerian oil to understand the present. In “Indigenization
Versus Domiciliation: A Historical Approach to National Content in Nigeria’s Oil and Gas
Industry,” Jesse Salah Ovadia writes about the history of the oil industry in order to help the
reader gain an understanding behind current Nigerian oil content laws. Previous content laws
theoretically promoted revenues being spent by the Nigerian government in order to empower
106
Omeje. ibid.
107
Boele, Fabig, and Wheeler. op. cit.
108
Ehtisham Ahmad and Raju Singh. 2003. “Political Economy of Oil-Revenue Sharing in a Developing Country:
Illustrations from Nigeria.” IMF Working Paper.pp. 1-26.
109
Festus Owete . 2014. “Delta, Ondo Oil Communities Demand Control of Derivation Money.” Premium Times.
110
Eweje. op. cit., 218-235.

33
Nigerians with new economic opportunities and give Nigeria control over the oil industry.111
As
we have seen in current history, these laws were not successful. In later years, decrees were
passed aiming to increase indigenous Nigerian participation in the economy by transferring
foreign capital to indigenous hands.112
We will be able to use past Nigerian history to discuss
how it has negatively impacted the present.
Plundered Nations?: Successes and Failures in Natural Resource Extraction, edited by
Paul Collier and Anthony J. Venables, also looks into the history of the Nigerian oil industry.
Unlike Ovadia’s literature, the authors look at the management of oil resources throughout
history and analyze what decisions were made that ultimately led Nigeria to become a struggling
oil state.113
We already know that some of oil revenues are reinvested into infrastructure in
Nigeria. During the 1970s, the Nigerian government was focused on reconstruction and the
development of human capital, health services, and infrastructure like roads and sea ports.114
Nseabasi S. Akpan, author of “From Agriculture to Petroleum Oil Production: What Has
Changed about Nigeria’s Rural Development?,” has different viewpoints on how oil revenues
were reinvested back into society. Akpan claims that rural infrastructure has typically been
neglected and that infrastructure was, and currently is still focused on major cities. It will be
important to look at expenditures of government money to clarify where and how oil revenues
were reinvested into Nigerian infrastructure.
A major component to our research is the negative environmental effects that come as a
result of oil production. Prior to reading, we already knew that oil spills, gas flaring, and land
degradation were all harmful impacts oil production have on the environment. In “Coping with
Climate Change and Environmental Degradation in the Niger Delta of Southern Nigeria,” gas
flaring and oil spills are discussed in depth and their ultimate consequences to farmlands, rivers,
and the ocean.115
We found that oil spills, gas flaring, and acid rain not only affect the
111
Jesse Salah Ovadia. 2012. "Indigenization vs. Domiciliation: A Historical Approach to National Content in
Nigeria's Oil and Gas Industry." African Political Economy: The Way Forward for 21st Century Development.
112
Jesse Salah Ovadia. ibid.
113
Paul Collier and Anthony J. Venables, eds. 2011. Plundered nations?: successes and failures in natural resource
extraction. Palgrave Macmillan.
114
Collier and Venables. ibid
115
Etiosa Uyigue, and Matthew Agho. 2007. "Coping with climate change and environmental
degradation in the Niger Delta of southern Nigeria." Community Research and Development Centre
Nigeria (CREDC).

34
environment, but the livelihood of local peoples as well.116
The book Oil, Environment and
Resource Conflicts in Nigeria, edited by Augustine Ikelegbe asks interesting questions in the
introductory section:
Since oil and gas are exhaustible resources, what happens when they are exhausted and
when no revenue inflows would be expected to the region?...what would happen as the
land and waters of the region are devastated, livelihood sources have been destroyed,
social lifestyles have been perverted and productive orientations have been
disoriented?117
While this paper is about the facts of the oil industry in Nigeria, it poses interesting “what-if”
scenarios, should the oil industry not make strides to better its infrastructure and environmental
regulations. Along with posing consistent statistics with other works of literature, this will enable
us to draw conclusions on our own, on the negative impacts of oil production.
116
Uyigue and Agho. ibid.
117
Augustine Ikelegbe ed. 2013. Oil, environment and resource conflicts in Nigeria. Vol. 7. LIT Verlag Münster: 4.

35
4. Case Study
4.1 Petrol and Layered Logistics
The Federal Government of Nigeria and the multinational oil companies that operate in
Nigeria are conspicuously intertwined, resulting in an obscure partnership, multi-level financial
arrangements, and a system of property rights that values the state as an entity more than
individual indigenous stakeholders. Oil discovery in 1956 brought a new and powerful
dimension to the colonial economy and after Nigeria gained independence, it continued to be an
important factor in fiscal security. Tenure systems for land and the ownership of mineral wealth
was realized to be crucial in these processes, and the new government began to pass laws
regarding these issues. In 1969 the Petroleum Decree was enacted, placing the gas and oil
supplies of the country under the authority of the federal government. In a related legislation, the
1978 Land Use Decree placed all land of any type under national control, essentially using
nationalization as a substitute for the long-standing rules of customary land ownership.118
Rather
than “negotiating directly with oil companies over access to land and compensation” as was done
before the decrees, the power of bargaining for communities was usurped by local and state
institutions.119
Claims of “overriding public interest” after the 1978 statute also enabled the
federal government to easily appropriate lands for the construction of pipelines and extraction
projects.120
Many communities struggle with these laws which do not recognize the land that
members live and work on, and therefore the minerals beneath the land, as territories owned by
those who have inhabited it for generations. These decrees, by allowing the state to have absolute
proprietary rights, leave communities living on resource-rich lands subject to the complete
control of state economic interests, and the uncertainty of a stable residence if their area is seen
as too valuable for just human occupancy.
The Federal Government of Nigeria began to seek dominion within all oil industry
aspects, beyond only mineral rights. Nigeria joined the Organization of Petroleum Exporting
Countries (OPEC) in 1971, becoming part of an exclusive group of countries with the ability to
regulate oil output and influence prices around the world.121
OPEC insists that member states
118
P. Francis and S. Sardesai. 2008. “Republic of Nigeria Niger Delta Social and Conflict Analysis.” World Bank. p.
12.
119
P. Francis and S. Sardesai. ibid.
120
P. Francis and S. Sardesai. ibid.
121
Organization of the Petroleum Exporting Countries (OPEC). 2015. “Nigeria Facts and Figures.”

36
engage in all stages of petroleum production as a majority associate as much as possible.
Therefore, in order to begin taking back privileges from foreign companies, the federal
government created the Nigerian National Oil Corporation (NNOC) in 1971.122
“The NNOC was
empowered to acquire any asset and liability in existing oil companies on behalf of the Nigerian
government,” and throughout the 1970s, the NNOC recovered allowances from numerous
transnational oil corporations.123
The federal establishment managing petroleum commerce
became the Nigerian National Petroleum Corporation (NNPC) in 1977 and “inherited the
commercial activities of the NNOC.”124
Although the NNPC has some oversight capacity, the
majority of regulation is under the jurisdiction of the Federal Ministry of Petroleum Resources
and their Department of Petroleum Resources (DPR).125
Joint ventures solidified between the
NNPC and transnational oil corporations ensure that the state government has a 55% to 60%
“participatory interest,” and therefore some say in the procedures performed by oil companies.126
Agreements such as these joint ventures are the most common type of business agreement in the
Nigerian oil industry, and are so prevalent that they constitute 95% of Nigerian petroleum and
natural gas activities.127
The most prominent multinational corporations, which make up almost 97% of
production endeavors, include well-known names like Shell, Chevron/Texaco, and
ExxonMobil.128
Before companies can operate in a way that earns profits they must obtain three
permissions granted by the Minister of Petroleum Resources. The authorizations encompass the
Oil Exploration Licence (OEL) which is “necessary to conduct preliminary exploration surveys,”
the Oil Prospecting Licence (OPL) which begins contract agreements with the government, and
the Oil Mining Lease (OML) which allows commercial extraction in an area for 20 years.129
Since 1973, deals with conglomerates have had another common aspect: they are considered to
be Production Sharing Contracts (PSCs) that place the risk of exploration on companies, whether
122
Olajumoke Akinjide-Balogun. 2001. “Nigeria: Legal Framework Of The Nigerian Petroleum Industry.” Mondaq.
123
Olajumoke Akinjide-Balogun. ibid.
124
15.
125
Olajumoke Akinjide-Balogun. op. cit.
126
127
33.
128
Olajumoke Akinjide-Balogun. 2001. “Nigeria: Legal Framework Of The Nigerian Petroleum Industry.”
Mondaq.
129

37
oil is found or not.130
Theses types of agreements also split discovered oil into a few categories
with varying importance: "Royalty Oil" pays concession rents and royalties, "Cost Oil" covers
the cost of operations, "Tax Oil" gives to the government through the Petroleum Profit Tax
(PPT), and "Profit Oil" leaves what is left to divide as percentages between all partners of an
agreement.131
Royalties and the Petroleum Production Tax are amassed by the Federation Inland
Revenue Board as an act of government and, with profits made, comprise the total oil income for
Nigeria.132
Revenues are apportioned among many parties and the numerous layers to agreement
and payment processes have not been successful in distributing income effectively, or improving
the lives of most Nigerians.
The equitable allocation of revenues gathered from the oil industry has been a point of
contention for many communities in the Delta for many years. A derivation formula was
established from the outset of oil production in 1958 which set revenues to be distributed to
extraction communities at a rate of 50%, the Federal Government of Nigeria at 20% and the
Distributable Pool Account, created to apportion funds to states from the federal sphere, at a rate
of 30%. Since that time the percentages have been erratic as more states have been created,
transitions of government rule have occurred, and offshore drilling has become the domain of the
federal administration.133
In 1999 the new constitution, under the category of Public Revenue
section 162, speaks to a ‘Federation Account’, previously the Distributable Pool Account, which
accumulates all revenue by the federal government, apart from certain officials’ income taxes,
and allocation is decided after the President councils with the Revenue Mobilization Allocation
and Fiscal Commission (RMAFC). The President and his council then consider “population,
equality of States, internal revenue generation, land mass, terrain as well as population density”
into choices of disbursement. The article goes on to state that “the principle of derivation shall be
constantly reflected in any approved formula as being not less than thirteen per cent of the
revenue accruing to the Federation Account directly from any natural resources.”134
The
arguments surrounding this number only serve to hinder the formation of an improved system,
130
Akinjide-Balogun. ibid.
131
132
133
27.
134
The Federal Republic of Nigeria. 1999. “Constitution of the Federal Republic of Nigeria.”

38
and obscure other issues of marginalized communities, mismanaged distribution and inadequate
well-being which persist despite large profits of the oil industry.
4.2 Impaired Institutions
The legacies of colonialism have left their mark upon the political and social structures
that dominate Nigeria today, and the formation of a resource dependent state since independence
has not enabled an internally stable government to be built. The indirect model of colonization
exercised by the British meant that although they pulled strings in the capital, local chieftaincies
and leaders who were friendly to the interests of Britain were bestowed the privilege to continue
acting as authority figures in communities, thereby blurring the understanding of the situation for
rural communities.135
Identities held dear by local peoples and nationalistic ideologies under
colonial rule brought some civil rights, but also a disconnect with the definition of who was the
bearer of customary rights. Nigeria was then made to create statutory regulations to “decide
which ethnic groups were indigenous and which were not [as] a basis for political
representation.” This process is said to have “convert[ed] ethnicity into a political force”,
although one may argue that such systems had been instigated from the beginning of British
rule.136
In the post-independence era the three states of the federation, which had been created
under colonial rule and favored the three most prominent ethnic groups, were still the only
officially acknowledged regions, but disagreement over these lines came soon after liberation.
The Ogoni Central Union had arisen prior to independence and formed the Ogoni Native
Authority in 1947 to advocate for separate space, and was reluctantly lumped into the Eastern
Region where the Ogoni people suffered “tremendous neglect and discrimination” at the hands
of the prevailing Igbo people in the area.137
In order to address the worries of smaller ethnic
groups in the region who were being underrepresented, the Willink Commission was entrusted
with the task of exploring local concerns stemming from this issue in 1958 as the prospect of
Independence approached.138
Despite the proposal for the outlining of new states, the
135
57.
136
Michael Watts. 2004. "Resource curse? Governmentality, oil and power in the Niger Delta, Nigeria." p. 73.
137
Watts. ibid. p. 67.
138
Francis and Sardesai. op. cit., p. 30.

39
Commission chose instead to install the Niger Delta Development Board in 1961 to work on the
problems voiced in that locality. The proceedings of this board were “largely ineffective” as it
lasted less than a decade and was spoiled during its term by the outbreak of the Biafran War, a
conflict from 1967 - 1970 that was rooted in the secessionist movement of the Eastern Region.139
Although during the war, the Rivers State was created in order to “appease the minorities of the
Niger Delta”, other concerns of minority communities fell by the wayside as the region strained
its energies on the efforts of war rather than working to the solutions that could prevent similar
cases in the future.140
The marginalization of minority communities across Nigeria manifested as interethnic
tensions as well as intra-ethnic issues of which examples can be found even in the clans of
Ogoniland. Ogoniland became incrementally integrated into the Rivers State, but cohesion was
still being constructed among its community members. As Ogoniland defined itself, certain
subgroups gained a dominance of political persuasion within the Ogoni, and others such as the
Eleme clan refused to sign the Ogoni Bill of Rights because of their connection to clan loyalty
first.141
These instances demonstrate Watts’ point of nuanced inconsistencies between vying
identities such as local and national. Ken Saro-Wiwa hoped for a more unified Ogoni people
despite tensions, and Watts described Saro-Wiwa’s “crowning moment of glory” as the inception
of the Ogoni anthem and the Ogoni flag on January 4, 1993–Ogoni National Day–which
represents the solidarity he had always yearned to see in his homeland.142
The past disagreements
seem to have dissipated as communities have come together in the creation of organizations
seeking to improve the living conditions of humans and nature in Ogoniland.
4.3 Facts about The Ogoni
The Niger Delta is comprised of nine states with five such states considered to be “core”
to the region, including: Bayelsa, Delta, Akwa Ibom, Cross River, and Rivers.143
Ogoniland is in
the Rivers state of the South-South geopolitical zone, a Southeastern region of the Niger Delta
near Port Harcourt with an area of approximately 1,000 square kilometers. There is evidence
139
Francis and Sardesai. ibid., p. 57.
140
141
Watts. op. cit., p. 69.
142
Watts. ibid. p. 70.
143

40
showing that the Ogoni people have inhabited the area for over 500 years, and were not fully
under British colonial rule until 1901, when British forces arrived in the region. A resistance
against British rule lasted for 13 years until Ogoniland was finally subjugated in 1914. In regards
to Nigeria as a whole, the British grouped Nigerians into a mere few ethnic groups, ultimately
leaving the Ogoni without proper representation and effectively stratifying ethnic interactions.144
The traditional government of Ogoniland simultaneously operates within the current
structure of the Federal government of Nigeria. Ogoniland encompasses six kingdoms: Tai,
Eleme, Ken-Khana, Nyo-Khana, Gokana, and Babbe, with the town of Bori acting as the capital
of Ogoniland.145
Each kingdom has individually ruling chiefs, and often councils of elders,
though there is Paramount Ruler that presides over all kingdoms titled His Majesty King Godwin
N.K. Gininwa. Ogoniland incorporates four local administrative districts including: Tai, Eleme,
Khana, and Gokana, which each control diverse ranges in the area as well as the diverse cultures
that live within their boundaries. Although each of the four zones are considered to be Ogoniland
and the area has some shared history, the indigenous groups who reside in each area are unique
unto themselves with distinguishing characteristics which generate variances not just in language
but in their traditional arrangements of power, politics, and decision-making.146
These differing
qualities of over 250 linguistic and indigenous communities were largely ignored during the
colonization of Nigeria by the British Empire; only a few ethnic groups gained formal
recognition by the British when the territory was split into three federal regions: the Yoruba, the
Igbo and the Hausa-Fulani.147
The British decision to discount these smaller cultural groups
would begin the socially-accepted downgrading and relegation of these groups to a realm of less
importance that became apparent in colonial administrations and within interethnic relations.148
4.4 The Economic Context of Development
Prior to the discovery of oil in Ogoniland, fishing and agriculture was the primary means
to make a living in this region. Subsistence agriculture satiated local consumption and was so
144
Unrepresented Nations and Peoples Organization. 2008. “Ogoni.” UNPO.
145
Unrepresented Nations and Peoples Organization. 1995. “Report of the UNPO Mission to Investigate the
Situation of the Ogoni of Nigeria” UNPO.
146
United Nations Environment Programme. 2011. “Environmental Assessment of Ogoniland.” p. 24.
147
148
Unrepresented Nations and Peoples Organization. 1995. “Report of the UNPO Mission to Investigate the
Situation of the Ogoni of Nigeria” UNPO.

41
fruitful that the region began to produce enough food to provide for the demands coming from
foreign industrialized nations.149
After the discovery of petroleum in 1957, concentration on the
agricultural and fishing sectors of the economy diminished and the new focus became oil. In the
period between 1973 and 1981 this transition became increasingly apparent as records indicate
farmed commodities dropped from US $1.5 billion to almost US $300 million in terms of
economic worth.150
The extraction activities within the region have severely limited the ability of
farmers to produce as large corporations have seized territories and oil spills have damaged the
surrounding land and bodies of water, making a hostile condition to foster crops.151
To this day,
there are numerous environmental and social problems stemming from the oil industry still
facing Ogoniland and its inhabitants, damaging traditional ways of life.
Nearly 60% of people in the area remain reliant on their surrounding environment for
income generation, and World Bank research from a 2003 study discovered that if crops were
counted as part of livelihood as well, then 100% of family economic power was dependent on
the environment. This fact is compounded by the high rates of underemployment and joblessness
in the Delta compared to all other state constituencies. The labor market in the oil sector is
unable to meet the supply provided by local community members because its formal work
typically requires technology and capital, and therefore there is less of a desire for the unskilled
laborers which are mostly available.152
Because Delta residents are unable to compete with
transnational corporate efforts, there has been a consistent failure to financially support social
capital and indigenous economies, characterizing the circumstance of low local content.153
Policy
moves on the part of government to encourage local content, or ‘Nigerian Content’, in smaller oil
industry ventures owned by indigenous businesses have made “very little positive impact”
overall. However, there is hope for a future of greater connectivity among differently sized and
spatially oriented companies in the national petroleum economy with the enactment of more firm
149
United Nations Environment Programme. 2011. “Environmental Assessment of Ogoniland.” p. 20.
150
United Nations Environment Programme. ibid. p. 20.
151
Unrepresented Nations and Peoples Organization. 2008. “Ogoni.” UNPO.
152
153
Ugwushi Bellema Ihua, C. Ajayi, and K. N. Eloji. 2009. "Nigerian Content Policy in the Oil and Gas Industry:
Implications for Small and Medium-sized Oil Services Companies." In Proceedings of the 10th Annual Conference.
p. 163.

42
legislation.154
According to Shell Nigeria’s website, it “directly” employs 4,500 people, 95
percent of whom are Nigerian, and 66 percent of whom are from the Niger Delta specifically.155
These numbers equate to 4,275 people from Nigeria, and 2,970 of those from the Niger Delta
who are directly employed by Shell Petroleum Development Company of Nigeria. The number
of Shell-employed individuals from the Delta is not very impressive, nor indicative of
inclusivity, when the total population of the Delta is considered to be over 31 million.156
Some
local people have also reported being discriminated against when seeking work in the petroleum
industry; their applications are ignored in favor of other ethnic groups.157
A lack of economic
inclusion into the oil industry formal sector, and the absence of local employment for petrol
firms, reinforces a downward spiral of unemployment and the futile search for jobs in the area.
Youth between the ages of 15 and 24 have an especially difficult time finding work to support
themselves and their families; beyond the statistics of all other geopolitical zones, a level of non-
working youth estimates being upwards of 40% for the Delta, show a need for gainful
employment not being met.158
With limited occasions to branch into lucrative activities or stable
incomes, the informal and illegal sectors become the most prominent alternatives, and insecurity
becomes a reality for many families.159
The Gini coefficient, which measures the equality of income shared throughout a society,
when applied to the Niger Delta, finds numerical data that shows a pronounced inequality of
wealth distribution. In Rivers State in particular the coefficient of 2004 was 0.479160
as compared
to the coefficient for all of Nigeria in 2003, 0.437.161
The closer the coefficient is to zero, the
more evenly the wealth is distributed. Despite an improvement from 1997’s coefficient of 0.506,
the numbers symbolize a vast economic gap that still exists.162
Surveys completed in the Niger
Delta found that 77% of the people residing there view themselves as ‘living in poverty’, with
154
Ugwushi Bellema Ihua, C. Ajayi, and K. N. Eloji. 2009. "Nigerian Content Policy in the Oil and Gas Industry:
Implications for Small and Medium-sized Oil Services Companies." In Proceedings of the 10th Annual Conference.
p. 168.
155
Shell Nigeria. 2015. “Shell Petroleum Development Company of Nigeria.” Shell.
156
157
158
159
160
161
Central Intelligence Agency (CIA). 2014. “Nigeria.” The World Factbook.
162
Central Intelligence Agency (CIA). ibid.

43
around 30% of the entire population self-evaluated as ‘very poor’.163
Although these findings
have inconsistencies when compared to some national accounts, due to the subjective nature of
personal assessments, they demonstrate the perspective of Delta peoples on their own
circumstances. With capricious definitions of the poverty line demarcated by countries, which
can be based upon their own conceptions of poverty and may be able to sway the significance of
statistics, the exact numbers may be difficult to determine. In 2010, however, there was an
estimate that 70% of all Nigerians lived below the poverty line.164
This major percentage of their
population, from an already an impressive 172 million, represents a serious proportion of
Nigeria’s citizens who do not have an adequate means of income. The World Bank’s Nigeria
Economic Report (NER) from 2014 shows some progress in the living conditions of the poor but
these efforts have been almost entirely concentrated on urban cities rather than where levels of
poverty are most persistent in rural localities.165
Income inequality breeds extreme discontent
among citizens who suffer most poignantly from a maldistribution of wealth, leading their self-
perceptions to reflect the appalling systemic nature of their suffering, especially when looking to
how others may be living affluent lifestyles elsewhere in the nation.
As for the federal derivation principle, in 1979 the government eliminated the practice of
derivation funding and even though it had made its way into the economic sphere again in 1992
the portion for oil producing communities was a meager 3%.166
Because Ogoniland stopped
producing oil in 1993, their years of operation endured an unstable allocation of revenue, before
the constitution had solidified agreements for extraction communities. The Ogoni peoples were
not able to profit extensively from the derivation principle while it was in effect due to a
tumultuous history of changing percentages, and certainly not directly from the post-
constitutional 13% minimum.
Current revenues are distributed to the federal government, as well as state and local
governments, and are then meant to make their way to local residents. Audits on government oil
revenues for the years of 2007 to 2011 have demonstrated that “from the sharing formula under
the Nigerian fiscal federal principle, the Federal Government took 56% of the total revenue,
163
164
Central Intelligence Agency (CIA). op. cit.,
165
The World Bank. 2014. “Nigeria Economic Update: World Bank Cites Positive Economic Trends and Progress in
Poverty Reduction.” World Bank Group.
166
Francis and Sardesai. op. cit.,. p. 28.

44
states 24%, while the local governments collected 20%.”167
Though these portions are above the
13% minimum for states and local administrations, the development that is meant to accompany
these funds is still not present, making the increased percentage ineffective in providing more
positive results. The local administrations often collaborate with chiefs who are then charged
with the responsibility to dole out these funds properly to individuals and to sustainable
development projects. Unfortunately these community leaders are sometimes seen as self-
seeking and untrustworthy, causing tensions within communities.168
Research into the Ogoni
people and their milieu depicts a setting where development projects, as of 2004, were found to
be lacking. Dismal figures such a health care system with a doctor to patient ratio of 1:100,000,
illiteracy for four out of five individuals, and infrastructure such as electricity being present in
very few homes.169
Reports also show that Rivers State is a rarity in the Delta due to its over
70% allocation of funding set for “capital projects” in its vicinity, but still only 10% of this
amount was destined for important social amenities such as health, education, infrastructure and
employment in the period between 2007 and 2011.170
The progress missing from Ogoniland
speaks to the disproportionate benefits and revenue results which were supposed to have been
ensured since the start of extraction, but are not apparent in the present day.
Because Ogoniland sees no money from oil production, the area relies on the funding
given to Rivers State to provide for development. In 2007 Rivers State was given US $1.7 billion
by the Federal Government of Nigeria, a number which exceeds the GDP of some neighboring
West African nations.171
As Ogoniland has lost its status as a host community where extraction
takes place, the area is no longer “entitled to development goods and payments” from oil
corporations which are given to other petroleum production sites.172
These additional
compensations provide a sort of ‘social license to operate’ but can also be a “divisive and
exclusionary” force between local communities.173
Here, the state government has failed to
allocate such a large financial support to localities transparently or equally, leaving many people
167
Zainab Ahmed.. 2014. “Deepening Knowledge About How Oil Money is Spent.” Extraction Industries
Transparency Initiative (EITI).
168
169
Watts. op. cit., p. 67.
170
Zainab Ahmed. op. cit.
171
172
173

45
of Ogoniland without basic needs met. The actual amount of money acquired through oil
production or derivation can only provide a partial explanation of the situational absence of
public works in the Niger Delta. The issue being raised today more often concerns the manner in
which these funds are spent and how they are managed by state and national officials.174
It is not
clear where the funds that the states receive are actually going.
The insufficient development in the region has prompted the creation of organizations to
address concerns over allocation uses, which bear impacts on local communities. In 2000 the
Niger Delta Development Commission (NDDC) was formed at the federal level while
organizations such as the Rivers State Sustainable Development Program (RSSDP) were started
at the state level a few years later. Both the federal government, through “ecological fund
allocations” and a portion of the 13% derivation, and transnational oil companies have
contributed to the NDDC, who then provides funds to Delta states.175
But in 2007 the NDDC
spoke out about a deficit discrepancy in their fiscal backing from the Nigerian Federal
Government throughout the seven years since its inception, amounting to US $1.9 billion.176
In
addition to this admittance, audits of the NDDC for 2007 to 2011 found that US $41.4 million
that was promised to projects in the Delta went unaccounted for, and could only partially be
explained by falsified completions and duplicated reports.177
Other federal funds to improve the
quality of life in the Delta such as the Stabilization Fund and the Natural Resources
Development Fund were exposed as “anything but close to its original objectives” because
money provided was utilized for unrelated activities, and there was even debt which accumulated
for the work of these inappropriate projects.178
Because members of the commission are chosen
by federal level politicians, residents of the Delta perceive the dealings of the commission to be
more invested in the transnational oil companies and politics funding them, rather than the
locals.179
Although the two phases of project implementation have produced some income
generation through cassava processing and aquaculture, efforts of the RSSDP are also often
thought of as a “political instrument with limited concrete benefits for the people of Rivers
174
175
176
177
Zainab Ahmed. op. cit.
178
Zainab Ahmed. ibid.
179

46
State.”180
Cries for transparency have attempted to be heard as part of the dialogue due to
occasions such as these where oil revenues travel through many hands and disappear before they
are able to reach local peoples. The civil society groups that have arisen to meet the demands of
indigenous communities in the Niger Delta and within Ogoniland are putting forth efforts to
create more accountability, local integration, informed awareness, and civic engagement with the
issue.
4.5 The Story of Shell Oil
For the last several decades, Shell Oil Company has been closely tied with the story of
Ogoniland. In 1957, Shell Oil Company began drilling for oil in Ogoniland.181
After 36 years,
protests eventually drove Shell to discontinue oil production in the region in 1993. It was
reported that the Nigerian government would find a replacement for Shell that met the Ogoni
people’s standards by the end of 2008.182
As of Spring of 2015, however, oil production in
Ogoniland has yet to resume; most of the Ogonis remain opposed to any oil drilling at this
juncture,183
although reports of support from Ogoni leaders did surface.184
Two years after the suspension of oil production, the then military government of Nigeria
executed poet and Ogoni activist Ken Saro-Wiwa. This event shook Ogoniland as well as the
entire country, and gained international attention. Allegedly “complicit” in the death of Ken
Saro-Wiwa was none other than Shell Oil. In 2009, Saro-Wiwa’s family was ready to take Shell
to court over the supposed wrongdoing, but Shell settled the case at a price of US $15.5 million.
Shell denied that the payout was an admission of guilt. Instead, they called it a “‘humanitarian
gesture,’” although the Ogonis do not believe the settlement took away from the malicious role
Shell played in Saro-Wiwa’s death. However, they did count it as a success to receive this
payment from Shell.185
Around the same time as this settlement, in 2008 and 2009, two major oil spills
devastated Bodo, Ogoniland, for which Shell Oil took responsibility.186
Shell does claim that
180
181
Movement for the Survival of the Ogoni People. 2015. “Ogoni.”
182
“Nigeria’s removal of Shell hailed.” 2008. BBC News.
183
Press Release. 2015. “Stay away from the Ogoni oil - MOSOP writes Belema Oil.” World Stage News.
184
Okafor Ofiebor. 2015. “Ogoni Again: Trouble Over Oil.” The News.
185
Andrew Walker. 2009. “Will Shell payout change Niger Delta?” BBC News.
186
John Vidal. 2011. “Shell accepts liability for two spills in Nigeria.” The Guardian.

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