Register for free      |     Facebook    |    twitter    |    Google+     |    Advertize for free

Author Topic: What Happens in 10 Years When We Hit 250 Million and Oil Sells for $15?  (Read 750 times)

Offline Admin

  • Administrator
  • Hero Member
  • *****
  • Posts: 1178
  • What do you think +3/-0
  • Gender: Male
  • Watch me as I unfold
    • View Profile
    • Oil & Gas Planet
Nigeria is probably the only country in the world that operates without a plan for the future. The country's revenues - mainly from crude oil - have been dropping steadily in the last few years. This has been attributed to many reasons, the most serious being that our biggest buyers have become less dependent on foreign oil. The United States, for instance, has cut its oil imports by more than one million barrels daily, a situation which is expected to continue in the next few years.

In the next 10 years, the United States would become an oil-sufficient nation. Oil import terminals are already being converted to export terminals. It has even been said that, in three years, the United States may stop buying our oil altogether and, in 10 years, it will become self-sufficient in oil. Improved technology on fracking and the release of shale rock gas have been chiefly responsible for this game changer. Moreover, in five years, 14 African countries would become major oil producers; in 10 years, many more would have joined. What this means in simple logic is that, in 10 years, the international price of crude may hover between $15 and $25 per barrel. This was the state we were during General Sani Abacha's days, except that Abacha was by far a better manager of the economy than all the three PDP presidents we have had since 1999.

Our current leaders behave as if they have no stake in the country. That is what could explain why they do not care what becomes of the country with this stark reality. In 10 years also, Nigeria's population should be about 250 million with the current growth rate, according to some estimates. What then happens to Nigeria when we are 250 million and crude sells at between $15 and $25 per barrel? Is anyone in Aso Rock giving that a thought?

There's no evidence that Nigeria's leaders are even thinking in this direction. That is not their problem at all. Their problem now is how they can continue in power beyond 2015 and how they can get as much as possible from the current easy money from oil. Even at that, we are not investing in new oil fields like other oil producers and the theft in crude goes on as if there is no government in place. Someone recently remarked that Nigeria should actually be categorised among the ungoverned areas of the world. This is not the first time I am writing about this impending doom on this page and will probably not be the last, but, as long as the current set of people remains in power, I could well be speaking to myself.

Of course, there is a way out and I have consistently discussed this. Agriculture, solid minerals and tourism are sectors that could earn even more money for Nigeria and provide many more jobs for Nigerians than oil. But does anyone care? The last comment on this I remember was President Jonathan saying he was not responsible for the woes of Nigeria and, therefore, nobody should disturb him.

The amount of revenue the country loses from gold alone is about N4 trillion per annum, which is roughly equivalent to our annual national budget. Poachers, which include many foreigners, steal gold from Zamfara State and transport it through Ghana and Benin Republic from where it finally ends in Europe and the Middle East for international trading around the world. And this is gold alone. Nigeria has more than 500 locations of solid mineral deposits and 33 different solid minerals in the country are in commercial export quantities; so what is stopping us? What is more, even though some states have more potential than others, there is no single state of the 36 states in Nigeria and Abuja, the nation's capital, that does not have solid minerals in commercial quantities.

Foreign investors in the world's largest mining countries like Australia, Canada and South Africa have not found Nigeria an attractive destination because the government has not made the sector a strategic one. The government has not meaningfully invested in the sector and insists that the private sector should do all the investments instead. That is not going to happen. There are investments that the government must do first before investors will get interested. That is what happened in the oil sector. If the government is serious about getting foreign investors in, it must also agree to provide security for miners. Foreign investors are not coming into Nigeria's mining sector but they are trooping into Ghana, a much smaller place, because the Ghanaian government treats the country's mining sector as a strategic one. Ditto for other African countries like Botswana and South Africa that have made good in this sector. And this is only solid minerals.

The agriculture sector is another area that can change the fortune of the country. Nigeria earns about $100 billion from oil annually. Brazil, a nation that has made agriculture a strategic sector, earns $300 billion annually from agriculture. The only way the government can make the agriculture sector strategic is to invest heavily in it. In countries like Brazil and Thailand that take agriculture seriously, the governments invest heavily in dam and gorges construction, land clearing and other capital-intensive ventures that could hamper big-time entry into the sector. In the 1970s, Brazil was a net importer of food; today, it is the world's largest producer and exporter of soyabeans, coffee, sugar cane, frozen chicken, ethanol, orange juice, meat. It is also a big exporter of milk, nuts, cocoa, forest products, tobacco, rice, corn. Agribusiness accounts for nearly 40 per cent of Brazil's export even though, like Nigeria, Brazil produces more than 2 million barrels of crude oil daily. There are nearly 51 million hectares of land under agricultural cultivation in Brazil. That is a serious country.

If our governments do not start working now, Boko Haram would be a child's play. But the hard truth is that Nigeria needs a new government that would be up to the job.


No To Six-year Single Term

The plot (or subterfuge, if you like) for a single term of six years for the president has been rekindled. But the issues and facts remain the same. The issue is not the number of terms an elected person is allowed to serve but enforcing the rules of free and fair elections and the enthronement of the rule of law. Our constitution with its fundamental principles has been well thought-out and, warts and all, remains one of the best and the most comprehensive in the world. We only need to ensure that only responsible people are allowed to work the constitution.

All these complaints and the desperate efforts to amend the constitution at every turn have been because we have had crooks at the helm of affairs of this country. Let's continue with what we currently have but ensure that only credible people get into power. There are many serious democracies that do not even have term limits but have done very well - the United Kingdom, Singapore, Malaysia, etc, according to the rankings of the Economist Intelligence Unit (EIU). The best democracies - Norway, Denmark, Sweden - have no term limits. But their leaders are not crooks.

Adewale Odubiyi
Owner, Nigeria Oil & Gas Forum

Nigeria Oil & Gas Forum


Related Topics

  Subject / Started by Replies Last post
0 Replies
Last post April 21, 2014, 07:27:54 AM
by Vincent Milner
0 Replies
Last post May 12, 2014, 07:17:06 AM
by Vincent Milner
0 Replies
Last post June 04, 2014, 07:32:45 AM
by Vincent Milner
0 Replies
Last post March 31, 2015, 09:34:34 AM
by Admin
0 Replies
Last post April 23, 2015, 06:01:28 PM
by jchima

Sponsored Ads

Quick Links

About Us
Contact us
Privacy Policy

Contact Info

Nigeria Oil & Gas Forum

Email Address
Contact Form
Business Hours
9.00am - 5.00pm (Mon - Sat)

Would you like to partner with us on this forum?

Then you can contact us here

Nairaland     Oil Prices     UK Gas Forum     Ghana Gas Forum     Russian Oil & Gas Forum     Israel Oil Forum     Agric Forum

Powered by EzPortal