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Relocating headquarters of IOCs to the Niger Delta

THE recent uproar in the House of Representatives over a motion praying it to mandate international oil companies (IOCs) to relocate their administrative headquarters to Niger Delta communities where they carry out most of their exploration activities was hardly necessary. If the aim is to get better outcomes for all stakeholders in the critical oil industry, we think our legislators should tread more carefully and keep the nation’s best interest in focus.

The debate on the need for IOCs to relocate their headquarters near their host communities has been on for a while now. This is a controversial issue, even though not surprising, considering the importance of oil to our mono-product economy. The presence of the oil companies anywhere confers prestige and economic empowerment. It is, therefore, no wonder that the oil producing communities are demanding a return of the companies’ operational headquarters to the Niger Delta states.

It must be noted that these oil compa- nies have not always had their headquar- ters outside the oil producing states. Shell had its headquarters in Port Harcourt; Chevron (Gulf, as it was formerly known) had its own base in Warri. The other IOCs also mostly had their headquarters in the Niger Delta, close to their operations. The situation changed with the increased mil- itancy in these host communities and its potent threat to lives and security. Many of these companies had to move out of the Niger Delta, mostly to Lagos.

This has been the situation for a very long time now. However, now that there is relative peace in the Niger Delta, should these IOCs continue to operate mostly outside their host communities? Honourable Goodluck Opiah (PDP, Imo), sponsor of the motion, is in the vanguard of those who think that this should not be so. He made a compelling argument for the headquarters of the IOCs to be moved to the oil producing communities, to make them more responsive to the problems of “pollution, environmental hazards, degradation and underdevelop- ment” of the areas. The motion was, how- ever, shot down by those who think that it would be setting a dangerous precedent to tell IOCs and any other business outfits where to locate their head offices.

We believe Nigeria can learn from the experiences of oil companies in other climes. In the USA, Canada, the Nordic countries and even close to us in Saudi Arabia, are IOCs situated far from their operational bases? The simple answer is no. The advantages of domiciliation of IOCs in oil producing states are obvious,

if we do not distract ourselves with the ethnic politics and filibustering that go with issues such as this in Nigeria.

As one of the contributors to the mo- tion pointed out, it would perhaps be more useful to pass the Petroleum In- dustry Bill (PIB) which has been lying prostrate in the National Assembly for many years now. If it is passed into law, it would bring the operations and over- all governance environment of our oil industry more in compliance with best global practices, to the optimal benefit of the host communities. This is the larger picture we must not lose sight of in this debate.

In any case, we must also not forget that the demand for the relocation of the IOCs’ operational bases to the Niger Delta is one of the peace initiatives of the President Muhammadu Buhari government. Having observed with pains, the collateral damage that insecurity and militancy visited on oil production and the national economy, the federal government and, indeed, all reasonable stakeholders, came to the conclusion that it had become necessary to engage the oil communities. Nigeria should not be seen as doing anything against the spirit and letter of the new understand- ing with these communities.

At the end of the day, what the ordinary man in the host oil communities wants is a better life and a more productive and secure environment for his future. He also wants a more equitable participation in the exploitation of his God-given resource and for those who take charge of the resource to be mindful of its negative impact on his environment. He also wants that environment reclaimed and renewed as may become necessary.

When we reach this understanding, the debate to relocate the operational headquarters of the oil companies close to their host communities would be- come less intense and less divisive. This is the time that the country, more than ever before, needs all hands on deck in the effort to revamp the economy and provide a better life for all citizens.


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This post was syndicated from The Sun News. Click here to read the full text on the original website.


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