Another opportunity for job creation


By Magnus Onyibe(Guest Editor)

THESE are perilous times for President Mu­hamadu Buhari and the 36 state governors of Nigeria. In fact, some would argue that this is not a good time to be president or governor in Nigeria. .Already, about twenty of the states are said to be so insolvent, that the governors are unable to pay civil servants their monthly emoluments without assistance from the fed­eral government.

The burden is even more severe on the seven active crude oil producing state governors who are now facing the risk of having oil installa­tions in their domain vandalized by Niger Delta Avengers- an apparent offshoot of the dreaded MEND and such other environmental rights organisations or criminal elements now hold­ing sway in the Niger Delta.For the sake of the clarity of the issues at hand, let’s use Delta State and governor lfeanyi Okowa, in whose domain the militants recently attacked oil installations, as example.

With the resurgent militants destroying oil production and transportation facilities, Forca­dos crude oil pipeline linking export terminal operated by Shell and a rig owned by Chevron twice in two weeks, Delta State is now groan­ing in pains and the governor is practically traumatized.

This is because owing to the substantial loss of estimated 300, 000 barrels of oil per day, due to the damaged oil infrastructure, Delta State will suffer reduced monthly revenue allocation from the Federation Account, FAAC . Essen­tially, the amount of money received as Delta State’s portion of the 13% derivation fund, is determined by the volume of oil pumped into the central reserve for export from the facilities located in the domain of the various oil produc­ing states.

Although Delta State is populated by about five million people, it has a huge wage bill of about N8bn. l’m told that since the oil price slump, the state government has been receiv­ing a little more or less than N6bn from the Federation Account, which is a shortfall of about N2bn needed to settle workers salaries monthly.

What that means is that, workers emolu­ments are augmented with Internally Gener­ated Revenue, IGR, which is also a paltry N2 -3bn due to slowdown in business activities. With two major oil facilities damaged, the volume of oil which Delta State contributes into the national pool is now shorter by at least 300, 000 mpd. So the amount received from FAAC will drop further and that im­plies more financial headaches.

In Okowa’s world, workers’ salary is considered priority, because as a grassroots politician, who anchors his political power on workers and the masses, the government takes workers welfare seriously.

Invariably, after paying workers, there is little or nothing left to fund development initiatives, hence those close to Governor Okowa say, he is usually moody towards the end of the month, as he loathes to fail in meeting workers expectations.

The scenario in Delta State described above, applies particularly to all the oil/gas producing states and generally to all the states in Nigeria -from Abia to Zamfara be­cause they are all practically sustained by oil revenue which accounts for about 70% of national income and 90% of nation’s forex income.

The ugly situation in Delta State has even been further compounded by news from Shell -the biggest oil exploration firm in Nigeria-which has also just declared force majeure in one of her facilities, citing van­dalism as reason for shutting in another 200, 000bpd. According to statistics from Nigeri­an National Petroleum Corporation, NNPC, it recorded a scandalous 3,153 punctured points on its oil pipelines in 12 months, end­ing March. As a result of losses sustained from such vandalism, the NNPC suffered operating deficits in excess of twenty four billion naira, in February and over eighteen billion, in March. Consequently, Nigeria is unable to meet her OPEC allotted quota of 2.2mbpd. In fact, right now, Nigeria is strug­gling to export less than 1.6mbpd largely due to forced shutdowns etc. This is about seven million barrels, short of the badly needed crude export to generate income in order to replenish our fast depleting foreign reserve.

In a recent interview with the chief execu­tive officer of Shell Petroleum and Develop­ment Company, SPDC, in Nigeria, Osagie Osunbor, he revealed that in 2014, theft of crude oil from SPDC pipelines was 37, 000 barrel per day. It dropped to 25,000 in 2015, in part due to sale of some of the facilities to indigenous investors and the SPDC boss further disclosed that the number of attacks also dropped from 139 in 2014 to 93 in 2015, but nonetheless, theft and sabotage still con­stitute about 85% of spills from SPDC pipe­lines.

Ibe Kachikwu, the Minister of State for Petroleum Resources, who also doubles as GMD of NNPC, reckons that the losses are more as he insists that Nigeria’s oil produc­tion is down by about 40% due to renewed militancy in the Niger Delta. When you add the debilitating effects of such horrendous vandalism induced losses to the tumbling crude oil price in the international market, then you can vividly see the reason there is palpable apprehension about the looming insurgency of militants that could further exacerbate an already complex and precari­ous situation in the Niger Delta zones in par­ticular and which is bad news for Nigerians as a whole.

What the scenario above illustrates is that starting from governors who are assumed to be enjoying in government mansions to the ordinary man who is hamstrung by dearth of infrastructure like roads, hospitals , pipe borne water, and schools, the threat or actual vandalization of oil assets results in more heartache.

Worse still, similar types of losses in the oil/ gas sector apply to electricity, telephone and water/dam infrastructure which were being consistently damaged or under threat at the peak of Boko Haram terrorist attacks in the North Eastern parts of Nigeria.

The destruction of communication and electricity infrastructure by terrorists was os­tensibly to prevent remote communities under attack from calling security agencies for help.. There is the need to protect public water instal­lations in Nigeria, which are core parts of criti­cal national assets.

Viewed from the prism of the colossal amount of money and lives lost to vandalism related activities catalogued above, it goes without saying that government should seek for enduring ways and means of protecting critical national assets such as the ones identified as be­ing under threat.

I needed to project how very important the safety of our critical national assets are to every Nigerian by highlighting the adverse effects that damages on them are having, and would continue to have on revenue generation for the benefit of all Nigerians, so that everybody would be on the same page about the dire need for the establishment of assets protection corps, being proposed in this article. Already, Presi­dent Buhari and Vice President Yemi Osinbajo, in the course of their campaign for office last year, promised that the Federal Government would recruit 500,000 unemployed graduates into the teaching profession to create employ­ment and also boost education, which is good. Another opportunity to create 1,000,000 jobs for youths through the establishment of critical national asset protection corps is knocking on the door now. Currently, there are a plethora of youths-centric outfits such as the National Youth Service Corps, NYSC set up way back in 1973, as a national integration forum for Ni­gerian youths.

Onyibe is a former commission­er in Delta State.


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