Natural resources, energy and environment
Nigeria is Africa's largest oil producer and one
of the world's ten largest oil exporters. Almost
everything that is pumped up is exported as crude oil.
Natural gas reserves are also among the largest in the
world, but gas has only recently begun to be extracted.
The electricity shortage is a major problem. Residents'
energy needs are largely met by firewood and kerosene.
Nigeria also has plenty of coal, iron ore, tin,
uranium, phosphates, limestone and marble. However, the
recovery is modest.
Major exports by Nigeria with a full list of the top products exported by the country. Includes trade value in U.S. dollars and the percentage for each product category.
Crude oil has been mined in the Niger Delta since
1958. Today there are several hundred oil fields.
Decades of extraction have caused environmental damage
and caused dissatisfaction among the locals who want to
share in the revenue. Since the 1990s, the oil
companies' operations have been disturbed by sabotage,
strikes and kidnappings of oil workers. Explosive
attacks on the pipelines have occurred frequently. From
2006, militant groups in the Niger Delta began to carry
out more unified raids against the oil industry. An
increasing number of foreign oil workers were kidnapped
and then released on high ransoms. The groups became
increasingly well organized and politically oriented.
The Nigerian military also now hesitated to enter parts
of the Delta area.
The disruptions caused production to fall from 2.5
million barrels to 1.5 million barrels in a few years.
An amnesty program in 2009 (see Modern history) helped
to increase oil recovery thereafter. In early 2016,
however, alarming signals came about new attacks and
fears were great for a new oil war.
Abbreviationfinder: A popular acronym site in the world covering abbreviation for each country. For example, NI stands for Nigeria.
Concerns in the delta area have increased interest in
the oil and gas found beneath the seabed offshore.
However, political turmoil and poorly managed oil
resources management have caused the big oil companies
to act cautiously. Instead, lesser-known companies from
China and South Korea, for example, have stepped in. In
addition, the Milis groups have shown that with the help
of fast motor boats they can also hit oil platforms far
out at sea.
Alongside pure sabotage, huge amounts of oil are
stolen before it reaches the export terminals in
Nigeria. How much is lost in this way is uncertain, but
according to estimates in 2015 it is up to $ 6 billion a
year. According to a Nigerian study presented in 2012,
about 90 percent abroad were shipped to criminal leagues
in primarily Ukraine, Serbia, Bulgaria and Singapore.
Nigeria's oil reserves are expected to last for
several decades. In the oil wells there is also natural
gas, which follows when the oil is collected. Until the
1980s, all gas was allowed to burn above the boreholes.
Billions of dollars of gas are still allowed to burn up.
Gas combustion spreads toxic fumes and chemicals around
the boreholes. Government and oil companies blame each
other, and the companies believe that many more
pipelines are needed if the gas is to be recovered.
Nevertheless, Nigeria is one of the world's largest
exporters of liquefied natural gas (LNG).
According to a 2009 agreement, Nigeria, Niger and
Algeria will build a 400-kilometer gas pipeline through
the Sahara. The gas is then supposed to reach Europe via
the Mediterranean. Management is estimated to cost $ 20
billion to build and the project has been delayed due to
difficulties with funding.
Officially, the state owns all oil and gas assets.
The state-owned Nigerian National Petroleum Corporation
(NNPC) acts as regulator of the industry, producer and
seller. NNPC collaborates on a joint venture basis with
foreign companies, including Shell, which has a large
part of the market. Corruption is widespread within the
NNPC and the entire industry, which means that the state
is losing billions of dollars in revenue. Maintenance in
the country's four refineries is neglected, which
contributes to the fact that almost 90 percent of the
oil products consumed in Nigeria must be purchased from
The imported oil products, such as gasoline and
kerosene, are subsidized by the state. It creates a
market for smuggling to neighboring countries with
higher fuel prices, which leads to fuel shortages in
Nigeria. The government has tried several times to scrap
the fuel subsidies. But this is a politically sensitive
issue, as many see the low fuel prices as the only
benefit the people get from the country's large oil
resources. No promises are made that the increased
resources the state would receive if subsidies
disappeared would benefit the people. Attempts have also
been made to sell the state refineries, but this too is
One third of the country's electricity comes from
hydropower and the rest from oil and gas-fired thermal
power plants. Production does not meet long-term needs.
Half the population does not have access to electricity.
The other half is used to many and long power outages.
In principle, everyone who can afford - both private
individuals and companies - stick with their own
generators to secure the electricity supply. The
shortage of electricity is a major obstacle to growth.
The situation is made worse by thieves stealing wires
and transformers, and militant groups in the Niger Delta
disrupt deliveries to the thermal power plants.
Previously, all electricity generation was done by
the state, but in 2013 gas power plants and electricity
grids were sold to private interests. Large investments
followed, but many of the new owners were forced to
realize that the systems were in miserable condition.
The power plants are also dependent on natural gas from
the state gas company, a subsidiary of NNPC, and
deliveries often fail.
The need for firewood for household needs contributes
to problems with logging and soil degradation. However,
the country's most serious environmental problem is,
however, the pollution caused by the oil industry in the
Niger Delta. In a 2011 report, UN's UN Environment
Program pointed to a disastrous humanitarian situation
after decades of recovery. The supply of food has been
destroyed as agriculture and fishing have been
eliminated, and the drinking water is in many places
seriously poisoned. According to Unep, the pollution is
so extensive that a decontamination would probably be
the largest of its kind in the world. Unep accused both
the government and Shell, which jointly commissioned the
report, for ignoring environmental regulations and
leaving the public behind the light.
Shell agreed in 2015 to pay the equivalent of just
over $ 83 million in damages to a municipality and its
inhabitants in the Niger Delta for the damage caused by
two oil spills.
FACTS - ENERGY AND ENVIRONMENT
Energy use per person
759 kilos of oil equivalent (2014)
Electricity consumption per person
144 kWh, kWh (2014)
Carbon dioxide emissions in total
96 281 thousand tonnes (2014)
Carbon dioxide emissions per inhabitant
0.5 ton (2014)
The share of energy from renewable sources
86.6 percent (2015)
No agreement with Cameroon
The Senate rejects a deal to hand over the Bakassi Peninsula to Cameroon.
The President resigns
The Speaker of the House of Representatives and her deputy resign under
threat of being dismissed due to a corruption scandal involving the renovation
of their homes and the purchase of dozens of cars.
Threats of broken armistice
Mend threatens to resume its attacks on oil facilities and to kidnap foreign
workers, after a high ranking member has been arrested on suspicion of arms
Armistice in the Niger Delta
The Mend guerrilla unilaterally announces an armistice.
Electoral traps governor
The Supreme Court decides that the newly elected governor of Anambra, which
belongs to the ruling party PDP, must resign because of cheating in the
Fuel subsidies remain
Threats to nationwide strikes cause Yar'Adua to withdraw its predecessor
Obasanjo's decision to abolish fuel subsidies.
Yar'Adua takes office
The new president promises reconciliation with Mend rebels, hoping that Vice
President Goodluck Jonathan will be able to contribute as a negotiator
Umaru Yar'Adua elected president
The ruling party PDP's candidate wins a landslide victory in the presidential
election. Foreign observers judge the election characterized by violence and