As world governments discuss a transition from oil to low-carbon energy alternatives at the U.N. climate conference in Dubai this week, how the oil industry should transition its operations must receive greater attention. An example of how not to transition is the current trend in oil divestment and decommissioning in Nigeria.
In the past, oil majors including Shell, ExxonM
It is likely that by 2030, all onshore and nearshore assets in the Niger Delta will be owned and operated by domestic companies.
And oil divestment in Nigeria is being conducted without effective government oversight. Ever since its independence in 1960, Nigeria’s government has been heavily dependent on oil revenue, non-transparent, plagued by corruption, and strategically dysfunctional, thus allowing the oil industry essentially free rein in its profit-taking, capture of regulators,and recklessness.
As international oil companies publicly signal their intention to reduce high-carbon holdings to meet climate goals, thesecompanies are mainly just selling high-risk, marginal assets in socially distressed areas (such as the Niger Delta) to domestic oil compani
For decades, all oil majors have committed environmental atrocities in the Niger Delta, while reaping billions in profits. Communities suspect that by divesting now, these companies are attempting to escape liability for their decades of negligence.
Most of the new operators do not conduct due diligence on the acquired assets, and lack the financial and technical capacity to safely manage these complex operations. After some sales, buyers often disagree who actually owns and operates the assets, and some have filed suit against the companies that sold the assets.
Given communities’ concerns that these new domestic companies lack operational experience and adequate safety standards, in 2015 the Nembe community (Bayelsa State) placed a caveat emptor (“buyer beware”) decree on a proposed sale from Shell to Aiteo. This was prophetic, as in 2019 and 2021 there were two major blowouts from a wellhead transferred inthe sale (https://homef.org/wp-
Local communities continue to raise serious concerns about derelict oil facilities (wellheads, manifolds, flow stations, and pipelines) in need of proper decommissioning, assert
The oil industry’s carbon footprint in the Niger Delta is one of the darkest spots on the climate conscience of the world. As with other petrostates, Nigeria is resisting the urgent need to transition from oil. The government is currently incent
To reform this dangerous trend, a broad array of civil society organizations in the Niger Delta propose adoption of a new code of conduct for responsible divestment of oil and gas assets, the National Principles for Responsible Petroleum Industry Divestment; an accelerated plan to ensure the safe decommissioning of oil facilities, and involving host
Transitions can be difficult. The current global transition to a sustainable, low-carbon energy economy is both urgently necessary and inevitable. Many who profit from the current unsustainable fossil fuel economy continue to resist the transition, resulting in perverse, self-destructive policy choices by industry and government. It is obvious that oil majors and their host governments currently have no intention of reducing production to support global climate security. Their greed may be humanity’s ultimate undoing.
In this context, it is imperative that Nigeria’s new president, Bola Tinubu, makes different choices, and reform the nation’s approach to oil industry divestment, decommiss
Rick Steiner is a professor and conservation scientist in Anchorage Alaska, Director of Oasis Earth (www.oasis-earth.com), and has worked globally (including the Niger Delta) on oil and environment issues for decades. In July 2023, he conducted a fact-finding mission to the Niger Delta to explore the issue of oil industry divestment, decommissioning, and abandonment, and his report: "Just Transition: Reforming Oil Industry Divestment, Decommissioning, and Abandonment in the Niger Delta, Nigeria" was just released (https://www.oasis-
Iniruo Wills is an attorney in Nigeria’s oil capital, Port Harcourt, Rivers State (Niger Delta); a former Environment Commissioner for Bayelsa State; involved in pursuing remedies for several large-scale environmental disasters; co-President of the Ijaw Professionals Association, and a governance and development consultant.
ReplyForward |