Nigeria’s former President, Goodluck Jonathan, has criticized Western companies that discovered oil in Nigeria, asserting they failed to develop the country due to a lack of appropriate laws and technical expertise.
Speaking on Wednesday night at the Champions of Nigerian Content Awards Dinner organized by the Nigerian Content Development and Monitoring Board in Yenagoa, Bayelsa State, Jonathan contrasted Nigeria’s experience with that of China.
He noted that unlike in China, oil companies operating in Nigeria preferred to outsource and import virtually all necessary equipment and services, leaving host communities with little to show for the oil resources in their regions.
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Jonathan, who received the Nigerian Content Lifetime Achievement Award, recalled his eagerness to sign the Nigerian Oil and Gas Industry Content Bill into law in 2010, a bill sponsored by Senator Lee Maeba of Rivers State and others.
He recounted a conversation with a Ugandan who explained how Uganda developed local skills before finalizing agreements with international oil companies, aiming to avoid Nigeria’s mistakes.
“I brought up this story because I used to tell people that if at the beginning of the oil discovery we had laws designed to protect us, Nigeria would have gone further than this. But we didn’t have those kinds of laws,” Jonathan stated.
He pointed out that Nigeria’s earliest oil laws, the Mineral Oil Ordinance of 1886 and 1914, likely saw no Nigerian input.
The first law directly governing the oil industry after commercial discovery in 1956 and independence in 1960 was the Petroleum Act of 1969.
He noted that the next significant proposed law, the Petroleum Industry Act, was worked on during his administration but was eventually passed in 2021.
Jonathan revealed that he swiftly signed the Local Content Act in April 2010, spurred by an experience he had in China in 2000 while serving as Deputy Governor of Bayelsa State. Leading a trade delegation to Daqing, China’s “oil capital,” he observed a striking difference.
“Remember that the Western companies discovered oil in commercial quantities in Nigeria in 1956. The same Western companies discovered oil in commercial quantities in China in 1968, two years later. But as of 2000, most of the needs of the oil industry in China were manufactured locally. But in Nigeria, if any company needs a valve, they must go to their home country. If they need anything, they must go,” he lamented.
He highlighted the minimal economic impact of large foreign investments in Nigeria’s oil sector: “So, if the companies say they are investing $1bn or $500m in a project in a state, then you ask yourself, what percentage of that money really goes to impact the local economy, and you see nothing because nothing is being produced here. In Nigeria, most of the people are labourers. Maybe about $50m will be spent here. Every other thing is spent outside.”
Jonathan commended the Executive Secretary of the NCDMB, Felix Ogbe, for effectively implementing the local content law.
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