[DEBATE] : (Fwd) Fighting Niger Delta militants is expensive

[Patrick Bond]

Nigeria: Oil firms spent $3.7 billlion on security in N’Delta

This Day (Nigeria) - February 5, 2009.
Abuja (Nigeria) - Oil companies operating in the country jointly spent 
an estimated $3.7 billion on the security of their workers and 
installations against attacks by militants and other criminal elements 
in the Niger Delta in 2008, THISDAY’s investigation has revealed.

Some security contractors, who spoke to THISDAY last week during the 
Offshore West Africa (OWA) conference in Abuja, said the escalation of 
the crisis in the Niger Delta had jacked up security expenditure in the 
area. It was gathered that the security situation has become so 
precarious that oil companies insist on heavy military presence to carry 
out their operations, while oil and gas workers are resigning their 
appointments to avoid persistent militant attacks.

However, some stakeholders have argued that if the money being set aside 
for security is invested in infrastructure, it will reduce militancy and 
criminality in the oil-rich region.

Addressing chief executives of oil companies in Lagos at the weekend, 
Mini-ster of State for Niger Delta, Chief Godsday Orubebe, lamented that 
the money spent on securing pipelines and oil workers through the Joint 
Task Force (JTF) and other security operatives was enormous.

“If that money is genuinely ploughed into employment generation, it will 
go a long way in solving the problem of militancy. A situation where 
only one person is a millionaire in a population of one million is 
dangerous,” he said.

Country Security Manager, Addax Petroleum Nigeria, Mr. Dennis Amachree, 
who was silent on the security expenditure for 2008 at the conference, 
however, admitted in a reamrk that the oil industry jointly spent $3.5 
billion on security in 2007. The Addax security boss, who is also the 
Chairman of the Oil Producers’ Trade Section (OPTS) Sub-committee on 
Security, further stated that the industry also lost $3 billion to 
production shut-in in 2007.
OPTS is the association of oil-producing companies operating in Nigeria.

“PENGASSAN (Petroleum and Natural Gas Senior Staff Association of 
Nigeria) is saying that its members might stop work if the security 
situation does not improve. If people are just being kidnapped so that 
oil companies can negotiate for their release, the situation would have 
been different, but the problem is that they are being killed. The 
situation is being worsened by some people who want it to continue 
because they are benefiting from it. Some people see it as a big 
enterprise but all of us have a collective burden to end it,” Amachree said.

According to him, the industry recorded 31 maritime attacks in 2007, 
while the number of attacks recorded between January and October 2008 
stood at 66.
Amachree also lamented that within the first nine days of 2009, the 
country’s oil industry recorded 13 attacks.
Chairman and Managing Director of ExxonMobil, Mr. Mark Ward, also spoke 
on the security challenges facing oil companies operating in the country

He said: “Our industry has proven time and again that it will accept 
reasonable risk, even for projects that require massive, multi-billion 
dollar investments that take decades to pay out. But only if measures 
are taken that allow us operate in a secured environment. Escalating 
incidents of kidnapping, piracy and other violent attacks on both 
personnel and facilities offshore Nigeria creates concern and should 
continue to receive priority attention from government.

However, an Ijaw youth leader, who spoke to THISDAY, said the 
militarisation of the oil-rich region is not the solution to the crisis.

“There has been increased militarisation of the Niger Delta since 2003 
but from Amachree’s statistics, militancy has also been on the increase. 
So, militarisation seems not to be the solution,” he said.

Increasing security expenditure in the region is also coming on the 
heels of what some stakeholders called decreasing government’s proposed 
expenditure for the oil-rich region in 2009 budget. Out of the 2009 
budget, government plans to spend N77 billion on infrastructural 
development of the Niger Delta, while securing oil workers and 
installations gulped $3.8 billion (N432.9 billion) in 2008.

Niger Delta Peace Ambassador, Chief Beinmonyo Rufus Spiff, said the 
money was not enough for the developmental projects yearning for 
government attention in the area. Spiff, who is the Chairman and 
Managing Director of River Creek Specialist Limited, also challenged the 
government to define the projects it plans to execute with the money.

“The money is not enough; they should define what and what they are 
going to do with the money. Can the money build a road from Yenagoa to 
Brass or Kaiagama? Can it build a road from Warri to Forcados or from 
Buguma to the Swamp area? Let them define what they want to do and they 
will find out that it is not enough. If NDDC (Niger Delta Development 
Commission) alone is getting N84 billion in 2008 and the mother ministry 
(Ministry of the Niger Delta) will get N77 billion in 2009, definitely, 
that money is not enough,” he said.