What-Multi-National-Oil-Companies,-Federal-Government,-Oil-Bearing-States,-and-Host-Communities-Should-Do-to-Bring-Peace,-Security,-and-Development

What Multi-National Oil Companies, Federal Government, Oil-Bearing States, and Host Communities Should Do to Bring Peace, Security, and Development

By Dave Ikiedei Asei.                              February 22nd, 2025

Preamble 

The frequent conflicts between multinational oil companies (MNOCs) and oil-bearing communities in Nigeria have led to operational disruptions, environmental degradation, and socio-economic hardships. These conflicts have resulted in frequent shutdowns of oil operations, significant revenue losses for the federal government, and heightened insecurity in the oil-producing regions. As someone with extensive experience in the oil and gas sector, I offer a comprehensive working guide to all stakeholders to foster lasting peace, security, and development.

The Role of Multi-National Oil Companies (MNOCs)

1. Corporate Social Responsibility (CSR) Enhancement
   MNOCs must go beyond token CSR projects and establish sustainable development programs that directly impact host communities. This includes the provision of basic infrastructure such as roads, schools, hospitals, and potable water.

2. Environmental Responsibility
   Oil spills, gas flaring, and land degradation remain major sources of contention. MNOCs must adopt best environmental practices, ensure rapid oil spill clean-ups, and implement zero-flaring policies to reduce pollution and health risks.

3. Job Creation and Local Content Development
   Instead of relying solely on expatriates, oil companies should invest in local workforce development by offering skill acquisition programs, scholarships, and employment opportunities for qualified indigenes.

4. Conflict Resolution Mechanisms
   A structured grievance redress system should be established to address complaints from host communities in a timely and transparent manner. This will prevent small issues from escalating into full-blown conflicts.

The Role of the Federal Government

1. Policy Formulation and Enforcement
   The government must review and strictly enforce policies that ensure MNOCs adhere to environmental and community development standards. Regulatory agencies such as the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) should be empowered to impose sanctions on defaulting companies.

2. Revenue Allocation and Transparency
   A fair and transparent revenue-sharing formula should be implemented to ensure oil-producing states and host communities receive adequate compensation for resource extraction. The 13% derivation fund should be efficiently utilized to benefit affected communities.

3. Security and Law Enforcement
   Security forces should focus on intelligence gathering and community engagement rather than militarizing the oil-producing regions. A joint security task force, involving local community representatives, should be established to protect oil installations while respecting the rights of the people.

4. Alternative Economic Development Programs
   Heavy dependence on oil has stifled the growth of other industries. The federal government should promote economic diversification in oil-bearing communities by investing in agriculture, tourism, and small-scale industries.

The Role of Oil-Bearing States

1. Effective Utilization of Allocations
   State governments must ensure that funds received from the federal government, including derivation funds, are used for meaningful development projects rather than being diverted for political gains.

2. Infrastructure Development
   States should prioritize infrastructural projects such as roads, electricity, and educational facilities to improve the standard of living in oil-producing areas.

3. Collaboration with MNOCs and Host Communities
   State governments should act as intermediaries between MNOCs and host communities to prevent disputes. A special oil community development board should be established to oversee projects and ensure accountability.

4. Skill Development and Entrepreneurship Support
   State governments should provide vocational training centers and business grants for youths in oil-producing communities to reduce their reliance on oil-related activities and prevent restiveness.

The Role of Host Communities

1. Engagement in Dialogue Instead of Violence
   Community members should prioritize dialogue and negotiations when addressing grievances rather than resorting to pipeline vandalism and protests that lead to shutdowns. Organized community leadership structures should facilitate discussions with MNOCs and government representatives.

2. Protecting Oil Installations
   Communities should see oil installations as national assets rather than targets for sabotage. Youth groups should be engaged as security partners in safeguarding oil infrastructure.

3. Accountability in Community Leadership
   Traditional rulers and community leaders should be transparent in their dealings with MNOCs and government agencies. Funds meant for community development should not be misappropriated.

4. Investment in Education and Skill Acquisition
   Communities must encourage their youths to take advantage of educational and skill acquisition opportunities provided by MNOCs and the government to foster long-term development.

Conclusion

For peace, security, and development to be achieved in Nigeria’s oil-producing regions, all stakeholders—MNOCs, the federal government, oil-bearing states, and host communities—must work together in mutual respect and accountability. A structured approach to corporate responsibility, fair revenue allocation, environmental sustainability, economic diversification, and community engagement will mitigate conflicts and create an environment where both the people and the nation can thrive. Implementing these strategies will not only stabilize oil production but also foster long-term development in the Niger Delta and other oil-rich regions