Boko Haram dims hopes of oil-fuelled revival of north Nigeria, keeps 3bn barrels in the ground

One theory is that instability in Nigeria's northeast gives neighbouring Chad free rein to pump out crude from the shared basins in the region.

SOCIAL and economic development has long been touted as the way to revive the fortunes of Nigeria’s impoverished north and prevent legions of disaffected young men turning to radical Islam.

But Boko Haram violence has scuppered progress, particularly from one potentially lucrative source of revenue—the oil found under the Lake Chad Basin in the country’s far northeast.

Nigeria struck black gold in the Kukawa area of Borno state in 2012, with estimates that 100 billion cubic metres of deposits lie beneath the lake and its arid hinterland.

The discovery raised hopes not just because of its potential to transform the region economically but to also help boost Nigeria’s oil reserves by three billion barrels to 40 billion barrels.

But the former head of the state-run Nigerian National Petroleum Corporation (NNPC), Andrew Yakubu, said in March that plans to start production had been put on hold because of the conflict.

Geologists, engineers and other technical staff quit while the country’s main oil unions warned workers to stay away, putting paid to extraction and further exploration.

“We have advised our members to avoid the northeast because we don’t want them to be killed by the lawless group,” said Babatunde Oke of the white-collar oil workers union PENGASSAN.

A senior NNPC official said efforts were ongoing to make the region safe for oil workers, against a backdrop of militant gains of towns and villages across the states of Yobe, Borno and Adamawa.

“For now, the plan is on hold because of the Boko Haram unrest,” he told AFP.

“But the GMD (group managing director) Joseph Dawha is in talks with (the) Nigeria airforce to ensure safe exploration in the Chad Basin.”

No blood and oil 

Five years of relentless violence in northeast Nigeria has claimed thousands of lives and made hundreds of thousands of others homeless.

The former governor of the Central Bank of Nigeria, Lamido Sanusi, now the Muslim emir of Kano, said this month that investment in the north was key to preventing radicalisation.

For Mustapha Ibrahim, a political scientist at Yobe State University, oil in particular could help reduce poverty, unemployment and lack of education which fuel radical recruitment.

“We need to address this social malaise to effectively tackle Boko Haram and this can be achieved with the judicious use of money from oil in the Chad Basin when oil production finally starts,” he said.

“The oil money will facilitate job and employment generation, mass education opportunities and other social and economic programmes which will in the long run do away with the factors responsible for the Boko Haram violence raging now.”

Boko Haram wants to carve out a hardline Islamic state in Nigeria but there have been no serious suggestions that its insurgency is driven by oil.

“There is no evidence that Boko Haram or their associates are motivated by a desire for control of oil,” said Andrew Noakes, coordinator of the Nigeria Security Network of analysts.

“The insurgency is driven primarily by ideological, religious, and socio-economic grievances rather than pursuit of financial gain.”

Avoid the resource curse 

Nevertheless, in the maelstrom of rumours that is Nigerian politics, there have been claims that some northern leaders have been fuelling the rebellion for personal economic gain.

One theory is that no oil extraction can be carried out as long as there is instability in Nigeria’s northeast, giving neighbouring Chad free rein to pump out crude from the shared basins in the region from its side of the border.

If and when the conflict ends, analysts say it will be vital to learn from the mistakes made in the Niger Delta region, where most of the country’s oil is currently produced.

The Delta has been wracked by violence while decades of corruption and mismanagement have done little to improve the lives of ordinary people, despite the billions the industry produces.

“Everything must be done to avoid the resource curse,” said Debo Adeniran, from the Coalition Against Corrupt Leaders, a pressure group. “Oil should be a blessing rather than a curse.”

Only good governance and accountability will bring the insurgency to an end, according to Ibrahim, warning that the stakes are high for Africa’s biggest oil producer.

“If that is not done Boko Haram may never end,” he said.

“The present crop may be defeated now but in a few years another disgruntled group may rise under different cover because the factors that breed such criminal groups are still with us”.

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