Nigeria - Niger Delta Oil Crisis

The Niger Delta is an unstable area of Nigeria, and inter-ethnic clashes are common - often access to oil revenue is the trigger for the violence. Pipelines are regularly vandalized by impoverished residents, who risk their lives to siphon off fuel. Vandalism is estimated to result in thousands of barrels of crude oil wastage every day - a loss to the Nigerian economy of millions of dollars each year. Nigeria is the world's sixth largest oil-producing nation. However, mismanagement and successive military governments have left the country poverty-stricken.

Although many observers of the South South think primarily of restive youths invading oil company properties when they think of conflict there, in fact the roots of South South conflicts lie deeper in history and in the contemporary social circumstances of the area. Contemporary history of the Delta can be summarized as economic decline and broken promises. Historically, Delta communities prospered as "middlemen" controlling trade with the interior, particularly palm oil products and slaves. But with the development of the colonial state and independence, the region experienced a steady decline and stagnation, for no new sources of wealth developed there to replace these activities.

More recently, the failure of the early independent Nigerian government to follow through on a promise to treat the Delta as a special development area, the steady reduction in the share of oil royalties that states in the Delta have received, and, finally, the habitual disregard of state needs by non-indigenous military state governors, continued and worsened Delta problems. The FGRN's neglect of the Delta's development (roads, schools, electricity, and health services all ended well inland before reaching coastal communities), Nigeria's overall economic decline since the mid-1980s, and the tendency of educated Delta youths to leave the area, have confirmed its status as an economic backwater. The people who remained behind simply lacked prospects elsewhere.

The complexity of issues and number of stakeholders involved exacerbate South South problems. The Delta, in part because of its riverine/swamp topography, has historically been politically extremely fragmented, and subject to frequent and at times violent disputes over land and fishing rights, as well as over traditional leaders' political jurisdictions. These all lead to cycles of "revenge violence." As more powerful weapons became available in the Delta in the mid- and late-1990s, disputes became more violent. Youth gangs became more powerful who were willing and able to protect their villages and elders. As democratic competition returned in 1998-1999, some of these same youths took up a new line of activity, paid disruption of campaign events, and/or provided candidates protection from such unwanted attentions. Finally, traditional leaders have lost much credibility and respect as they have been corrupted by payments from the military government and the oil companies.

There is an inevitable and serious conflict of interest between Delta communities that bear the environmental damage of oil extraction and the rest of the nation for which oil money is essentially a free good. Delta populations, clearly a minority, regularly lose these struggles. Had they some authority over environmental issues, many current problems might be more manageable. Lacking this, and given the federal government's control over all subsurface resources as well as "ownership" of all land, all Delta issues inevitably become national issues. The national government has failed to resolve these. In its campaign to "buy off" Delta discontent on the cheap, earlier administrations frequently corrupted Delta community leaders. There is a deep distrust in the Delta concerning the federal government and a feeling among local populations that most other Nigerians care little for their problems, so long as the oil flows. Delta populations constantly campaign for a larger share of the federal cake, most of which originates in their homelands (discussed further in the Economics section below).

As a result of these factors, and because oil companies did and do make tempting targets, many aggrieved youths in the Delta resort to direct action to extract compensation for their perceived losses. They invade oil company properties, take employees hostage, and shut down facilities. Oil companies typically negotiate release of captured personnel and properties with relative ease by paying the youths modest ransoms. This oil company strategy creates a "moral hazard": the willingness of companies to pay ransoms stimulates imitators of this lucrative "business," leading to sustained disruptions, at times to competition among youths, and to a general sense of anarchy in the Delta.

Another conflict closely linked to federal control over Delta oil and the economy in general is the intense competition for political office. For politicians, and for their communities, control of federal office opens the high road to resources that can be diverted from public to private or community control. Competition is naturally intense for federal political offices and has historically turned violent in the second election in each of Nigeria's two previous republics. In summary, federal control over oil and much of the rest of the economy tends to "federalize" many economic problems, particularly in the Delta, and stimulates intense efforts to gain and hold office throughout Nigeria.

In this culture of cynicism about government, economic stagnation and hopelessness, historical political fragmentation, and low-grade violent conflict, pre-existing political fragmentation became institutional disintegration. Small groups of youths with weapons went unchallenged and found oil companies easy targets for hold-up and ransom. As the oil companies paid off the first gangs, others were inspired and soon followed suit. Throughout the 1990s, incidents of youth gangs extorting payments from oil companies and engaging in violence escalated, until they leveled off and began dropping in 1999.

Something is needed to encourage multiple and historically competing/conflicting communities to start working together, to bring more moderate and mature leaders back into the centers of decision making, to co-opt or marginalize violent youths, and to find constructive and promising avenues of activity for a currently "lost generation." If the promised 13% royalties on oil production are actually paid to the states and spent in the Delta, and if the new Nigeria Delta Development Corporation (NDDC) comes on line, they might offer enough funds to leverage meaningful local cooperation in the development and implementation of "area development plans." Criminal gangs, called “cults” in some parts of the region, copied the methods of more sophisticated militants to amass wealth and power. In a recent trend, kidnappers targeted businessmen, doctors, teachers, religious leaders, foreign residents, and others. Gangs extended their reach beyond the Niger Delta states, where they originated as politically sponsored thugs to intimidate opponents and aid election rigging. In recent years power struggles between gangs resulted in extensive property damage and hundreds of deaths, including of civilian bystanders.

Without a broad and effective campaign to address the grinding poverty, environmental degradation, and political alienation of those living in the midst of the country's oil wealth, the situation is bound to deteriorate again in a short period of time.

A new generation of young men will take up a life of sabotage and kidnapping, confident that they can force the government to grant them amnesty. Meanwhile, the current generation of politicians and "reformed" militants will continue to accumulate wealth by other unscrupulous means in order to ensure victory in the next sham elections.