Twice in three weeks, call for the intensification of crude oil search in the Northern part of the country came to the fore. First, it was President Muhammadu Buhari who, according to the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Maikanti Baru, directed the corporation to deepen the search for crude oil in the North, especially in the Chad basin and other parts of the inland sedimentary basin. Then, just this past week, the Northern Nigeria Development Company (NNDC), owned by the 19 Northern states, announced that it had commissioned a British company to commence the process of prospecting for oil and gas in the Lake Chad and Benue basins.
There is little doubt about the need of the country as well as the states for increased revenue, especially with the catastrophic effect which the activities of Niger Delta militants have visited on the nation’s economy. According to Dr Ibe Kachikwu, Minister of State for Petroleum, the country is running behind by as much as 1.i million barrels of crude oil daily as a consequence of pipeline vandalism perpetrated by militants. This is about 50 per cent of the projection for 2016 budget. Considering that the N6.8 trillion budget already has a deficit component of about N2.2 trillion, vandalism has rendered the economy prostrate. This is why many states have been unable to pay salaries of workers and embark on any serious developmental project because what accrues to them from the Federation Account has dwindled greatly.
Since the easiest way of making money for the country is through crude oil sales, it is not surprising that both the Federal Government and the northern state governments are not sparing any cost to see the possibility of raising revenue through crude oil prospecting. If a state should join the elite club of oil producers in the country and the price of crude oil gets as high as $100 per barrel, the economy of such state will immediately witness a transformation. From a parsimonious regime, the state will translate into a wastrel, acquiring everything in sight, both the essential and the trivial.
However, in spite of the potential change which the discovery of new oil wells might effect, prospecting for oil at the present time appears a misplaced priority. The fact is that the world is looking beyond oil as a source of energy. Crude oil is believed to have contributed immensely to greenhouse effect which has brought about climate change. So, the world is on the lookout for cleaner and safer energy sources. This, more than any other factor, is responsible for the crash in the price of crude oil. Oil prices crashed through a combination of factors including global conspiracy. According to those who know, the era of high priced crude oil is gone. Already, the world is playing with the idea of battery-powered automobiles, not just cars. Buses, trucks, forklifts, rail cars etc which are battery-powered are being developed daily. The more these are developed, the less need there will be for crude oil. It is not as if crude oil will become totally useless, but it means the level of its usefulness will decline seriously. Knowing this, why do we need to expend energy and scarce resources on a venture that may fail to yield maximum benefit?
Moreover, it was gathered that over the last 30 years, a total of $340 million and N27 billion has been deployed to crude oil exploration in the North-East. If a fortune has been sunk in search of a fleeting fortune, what is the wisdom in staking more fortune to secure an unsure fortune? According to a study carried out in that region, there is an unproven reserve of about 2.3 billion barrels of oil reserves and about 14.65 trillion standard cubic feet of natural gas available for a minimum of four countries in the Chad Ba¬sin area, whereas there are about 37 billion barrels of proven oil reserves and about 187 trillion standard cubic feet of gas in the Niger Delta region. So, while there is the likelihood of oil and gas being available in the Lake Chad axis, the quantity does not give much room for cheer, considering that only a quarter of what is said to be likely available will accrue to Nigeria.
So, rather than expend scarce resources on the search for crude oil whose worth is heading south, the government will do well to devote more resources to improving agriculture and developing solid minerals. These hold better promises than crude oil which is at the verge of joining coal in the league of former premier energy sources.
The government had earlier promised to diversify the economy away from oil. With this in mind, there is absolutely no need to pay undue attention to crude oil prospecting. The resources available should be deployed to agriculture, which has the potentiality of creating employment opportunities for our teeming youths and solid minerals which can trigger industrial revolution.