Oil and gas dividend and the communities

Guardian

24 March 2011

Oil and gas dividend and the communities

Editorial   .

AT the recent Nigeria Oil and Gas Conference 2011 (NOGII) in Abuja the Minister of Petroleum Resources, Mrs. Diezani Allison-Madueke made it known through her representative at the conference that the oil producing communities will now receive dividends accruing from oil and gas revenue. This will amount to 10 per cent of the revenue and one per cent of the assets currently totalling $600 million. This does not include the current 13 per cent being earned as derivation share and other trappings of the status associated with being oil and gas producing communities.

This certainly will be received with mixed reactions across the country and among the oil and gas producing communities. This is not only because of the motive the government attaches to it but also because of the rationale and also the modus operandi.

Government obviously was targeting the need to quieten the Niger Delta dissidents and ensure an environment conducive to increasing both current output and the proven reserve of the oil and gas deposits substantially at least up to 2020. That position itself is weak because it does not address the long-term interest of the Niger Delta and may therefore be seen as no more than an election gimmick that can only be taken for what it is.

Also if the purpose is to address the damage of oil and gas production facilities in the said communities, still, it does not go far enough in quantifying that damage, past and present.