This House Has Fallen: Nigeria

September 30, 2004

(Maps of Nigeria: political; energy) I've been reluctant to write about Nigeria because it is so daunting a topic. It's the most populous nation in Africa, home to 137 million (growth: 2.45% annually), including more Muslims than Egypt. It's hard to avoid lapsing into tiresome platitudes about the country: desperately poor, "despite" abundant oil and gas reserves; declining economy, declining life expectancy, abandoned an IMF SAP and deal with the Paris Club [*], afflicted by desertification (IPS). What makes this continuing stream of misfortune so pathetic is that Nigeria is five years into civilian rule, has made considerable inroads into the astonishing corruption that scandalized even the Congolese, and is nearing the completion of a colossal LNG facility at Bonny Island. Nigeria is being launched from nowhere to fifth place as the world's leading supplier of LNG; capital investment in the Niger River Delta is—well—exploding. So what's the problem?

Casual readers might think of natural gas and imagine a sprawling mass of pipes in the jungle, round empaled with a glorious, undulating ball of fire. This is a good image to have; Nigeria, even now, flares 40% of its NG—it's a byproduct of the more venerable piggy bank, crude oil (Nigeria is the fifth largest supplier of crude to US markets, and the seventh largest producer worldwide). LNG facilities are expensive; while they reduce the volume of the gas 600 times, enabling it to be shipped in huge [hazardous] supercooled volleyballs, the two latest trains under construction at Bonny Island are expected to cost $2.1 billion. Additional infrastructure costs and payoffs to local notables have mentioned cited as bringing the costs for all six trains to over $8 billion (at which point Nigeria will be right behind Angola in LNG volume).

Then there are other factors in the LNG industry, such as shipments, where are very difficult and vary by region—unlike crude oil, whose convenience as a fuel is almost miraculous, NG is so difficult to ship that large customers are almost monopsonists for major producers. Plunging liquefaction and shipping costs have changed that, touching off a frenzy of investment in the business. But this has only succeeded in turning Port Harcourt and adjacent towns into simmering gehennim of violence and criminality:

Vanguard [Lagos]: The Armed Forces, yesterday, dared an insurgent group— Niger Delta People's Volunteers Force— led by Mujahid Dokubo-Asari to "strike first" and see the manifestation of Nigeria's "full military colours."

Meanwhile, the National Council of State (NCS) yesterday gave President Olusegun Obasanjo the go-ahead to crack down on all groups including MASSOB threatening the country's existence.

Asari had threatened to attack international oil facilities and personnel in the Niger Delta. An "all time war against Nigeria," he said, would be launched from October 1.

His threats and activities of his group are partly responsible for the current all-time high crude oil price that went above $50 a barrel yesterday, unsettling financial market[s...]

The Dokubo group advised oil majors to leave the Delta region, which pumps all of Nigeria's 2.3 million barrels per day production. It also accused Royal Dutch Shell, Nigeria's largest oil producer, and Italy's Agip of "collaboration with the Federal Government in acts of genocide" against the Ijaw. [...] An Ijaw leader and member of the Ijaw Youth Council, Mr. Patterson Ogun, distanced the Ijaw from Dokubo-Asari. "It is true that he used to be our national president, but we have since held elections and appointed new officers. The Ijaw don't believe in his approach of violence because it will heighten tensions," adding: "It is only Asari who can explain why he is doing what he is doing. We are not part of it."

Shell and Agip dismissed the militant group's threat, insisting it would not affect production. "We are not in any way moved by the threat. We believe the Nigerian security forces are equal to the task of safeguarding oil installations and protecting workers," said Don Boham, a Shell spokesman.

A spokesman for Agip said the company would continue with business as usual. "We will not halt production because of the threat. We are still up and running," the spokesman, who asked not to be named, said. "We know the Nigerian government will not close its eyes and allow disgruntled elements to disrupt its main source of livelihood," he said.

In a way, that's a shame because the standoff is quite trivial in the scheme of Nigerian violence: all the attention goes to a fly-by-night, theater-of-the-macabre insurgent "movement", while other groups who happen to operate outside of the Delta represent a far more protracted danger. Also from IRIN is this story of a clash with the shadowy Al Sunna wal Jamma sect, in which 27 followers died; the Head Heeb, discusses an outbreak of sectarian violence in central Plateau State that tested relations between the 36 state governors and Abuja. One wishes the crisis that attracted some foreign attention were the most grave one. In view of the negligible contribution fossil fuels have made to the fortunes of unhappy Nigeria, the much-touted spat with Mssr. Mujahid seems far from being that.