Niger Delta - Nigerian Oil

Nigerian Oil

Nigeria has become Africa's biggest producer of petroleum. Some 2 million barrels (320,000 m3) a day are extracted in the Niger Delta. First oil operations in the region originated in 1950s and were undertaken by Multinational Corporations, which provided Nigeria with necessary technological and financial resources to extract oil. Since 1975, the region has accounted for more than 75% of Nigeria's export earnings. Together oil and natural gas extraction comprise “97 per cent of Nigeria’s foreign exchange revenues”. Much of the natural gas extracted in oil wells in the Delta is immediately burned, or flared, into the air at a rate of approximately 70 million m³per day. This is equivalent to 41% of African natural gas consumption, and forms the largest single source of greenhouse gas emissions on the planet. In 2003, about 99% of excess gas was flared in the Niger Delta, although this value has fallen to 11% in 2010. (See also, gas flaring volumes). The biggest gas flaring company is the Shell Petroleum Development Company of Nigeria Ltd, a joint venture that is majority owned by the Nigerian government. In Nigeria, “...despite regulations introduced 20 years ago to outlaw the practice, most associated gas is flared, causing local pollution and contributing to climate change.” The environmental devastation associated with the industry and the lack of distribution of oil wealth have been the source and/or key aggravating factors of numerous environmental movements and inter-ethnic conflicts in the region, including recent guerilla activity by the Movement for the Emancipation of the Niger Delta (MEND).

In September 2012 Eland Oil & Gas purchased a 45% interest in OML 40, with its partner Starcrest Energy Nigeria Limited, from the Shell Group. They intent to recommission the existing infrastructure and restart existing wells to re-commence production at an initial gross rate of 2,500 bopd with a target to grow gross production to 50,000 bopd within four years.