Wednesday, August 31, 2016

A Brief History of the Petroleum Industry in Nigeria

A proven leader with nearly three decades of experience in the oil and gas industry in Nigeria, Akanimo Udofia is the managing director and CEO of Desicon Engineering. In this capacity, he oversees overall business strategy and growth and defines the company’s organizational operating model. Over the past decade, Akanimo Udofia has earned numerous awards for his work and completed more than $10 billion worth of industry projects.

The petroleum industry in Nigeria began in 1956 after oil was first discovered in the Niger Delta at Oloibiri. Made by Shell-BP, the discovery came after more than half a century of exploration and paved the way to the country’s eventual involvement in the industry as a whole. Within two years, the first oil field was set up in the area and was producing over 5,000 barrels per day. During this time, Shell-BP was still the sole concessionaire of oil in Nigeria, but exploration rights were extended to other companies starting in 1960. This led to the 1965 discovery of the EA field just southeast of Warri.

Nigeria’s petroleum industry saw a huge boost in profits following the end of the Biafran War. The world saw major spikes in oil prices, which benefited Nigeria’s burgeoning oil business. In 1971, the country joined the Organization of the Petroleum Exporting Countries (OPEC) and within six years had established the Nigerian National Petroleum Company (NNPC), a state owned and controlled company. By this time, Nigeria was producing more than 2 million barrels of crude oil every day. Despite a drop in production during the 1980s, the country has maintained and increased the production level over the years.

Today, Nigeria produces around 4 million barrels per day. The industry’s major success in the country has pushed agriculture to the background in terms of economic impact. Petroleum production now accounts for roughly 90 percent of the country’s gross economic earnings.