President Muhammadu Buhari deserves credit for presiding over positive changes that are responsible for the breakthroughs in Nigeria’s downstream oil ecosystem, says the writer. Picture: AP
President Muhammadu Buhari deserves credit for presiding over positive changes that are responsible for the breakthroughs in Nigeria’s downstream oil ecosystem, says the writer. Picture: AP

Bravo to Nigeria for turning oil curse into a blessing

By Opinion Time of article published Nov 29, 2020

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Victor Kgomoeswana

Johannesburg - Let us applaud Nigeria for its game-changing strides in its petroleum industry. President Muhammadu Buhari deserves credit for presiding over positive changes that are responsible for the breakthroughs in Nigeria’s downstream oil ecosystem.

Among these are two announcements in the past two weeks: a 5 000 barrels per day (bpd) modular refinery in the Ibigwe Field, Imo State, and the signing of a memorandum of understanding with Niger Republic to transport and store petroleum products. The latter will enable Nigeria to import Niger Republic’s excess refined products from the Soraz Refinery in Zinder, 260km from the Nigerian border.

Exporting the surplus is a welcome boost to the bigger dream of intra-Africa trade and regional integration within the Economic Community of West African States.

These are not small steps when seen against the world’s largest single-train oil refinery, due to commence production next year. Being completed by the Dangote Group in Lekki, Lagos, the refinery will be able to pump 650500 bpd when it comes onstream.

The refinery is the answer to what Africa craves: the beneficiation of its resources for local consumption. Nigeria has been synonymous with a country cursed by its own riches since oil was discovered there nearly 60 years ago. The same holds for every other African country, rich in mineral resources but exporting them cheaply and importing finished products at a premium.

Nigeria, thanks to its downstream projects, especially the Dangote Refinery, will demonstrate that problems are not a reason to give up. The $3 billion (about R44bn) injection into the Nigerian economy by a Nigerian corporation is a textbook case of African solutions for Africa.

Opec’s Annual Statistical Bulletin 2020 shows that petroleum products constitute 69.7% of Nigeria’s $64.8bn exports. Nigeria’s refinery capacity of 446 000 barrels in a calendar day is below its domestic demand of 469800 bpd, let alone the regional market for exports.

Anyone who has experienced Nigeria’s long queues at petrol stations or witnessed the degradation of human life and the environment in the Niger Delta will appreciate why the developments are desirable and progressive.

Nigeria has problems to overcome. When the country marked its 60th independence anniversary on October 1, there were understandable reservations and cynicism about whether there was anything to celebrate.

On November 10, the world commemorated the 1995, oil-fuelled assassination of writer, television producer and environmental activist Ken Saro Wiwa. Although there are success stories of agriculture making a return to the GPD mix, there are farmers, fishers and communities who will probably never be compensated for their lost livelihoods and lives as a result of the foreign-dominated oil industry.

The changes in the way the Nigerian National Petroleum Corporation is run, the prosecution of former petroleum ministers for corruption, and pursuit of domestic and foreign investment in the petroleum industry are promising signs that the Buhari administration could be remembered for transforming an oil curse into an indigenised industrialisation and growth cauldron. Bravo, Nigeria!

* Victor Kgomoeswana is author of Africa is Open for Business, media commentator and public speaker on African business affairs.

** The views expressed here are not necessarily those of Independent Media.

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