Worries of Onne Free Trade Zone in Nigeria’s Niger Delta

The Niger Delta region for many years was a centre for violence, communal clashes and militancy.

It took a negotiated and sustained intervention for the government to purchase relative peace in the region.

Until the now taken-for-granted relative
peace, the region was characterised by youth restiveness, militancy and
constant inter- and intra- communal clashes.

Serenity was scarce and cordial business-host community relationship was scarce.

Oil revenue dwindled due to the constant attacks on oil installations.

The impact of these events was felt by the multinationals, the nation and the international community at large.

Since then, the government had come to
realise the importance of concerted efforts at sustaining peace and
stability in the region.

It is widely acknowledged that youth
restiveness is a major hindrance to peace and progress anywhere, and
especially in the Niger Delta region.

Youth restiveness is a direct consequence
of high unemployment and non-engagement. This has been the lot of the
highly endowed Niger-Delta region.

The people are divinely blessed with
unquantifiable natural resources, especially the major one for Nigeria,
crude oil that has sustained the country for decades. Yet they are
subjected to a paradoxical level of penury.

In the midst of abundant natural
resources are a people living in abject poverty – highly fuelled by the
greed and corruption of the leaders both at the state and national
levels. There are no jobs for the teeming youths; the
few jobs available are claimed by a minute population through a
survival of the fittest struggle.

However, few companies and facilities
domiciled in the region have managed to employ the youths and sustain
the peace. Some of such facilities are the Onne Port and the Onne Oil
and Gas Free Trade Zone – the largest in the world.

Onne Port is perhaps the only functional
port in the eastern region. The other ports including Calabar, Warri and
Port Harcourt are all in a near-comatose state.

Onne Port has remained alive and proved that public private partnership is a veritable means to manage Nigeria’s port system.

The Free Trade Zone, on the other hand,
has become a destination of choice for multinationals operating in the
Niger Delta region.

And the patronage of these companies has
improved the capacity to provide employment for the teeming youths of
the region. In essence, it is an interwoven cycle that benefits all
parties – the companies, communities and government.

In the same vein, it is a relationship
that can be highly consequential by one party’s disconnection or
disaffection. Hence, the eyebrows the decision by Shell Nigeria
Exploration and Production Company (SNEPCo) to relocate its
supply base out of the zone has raised.

A statement by some concerned employees
of SNEPCo was recently circulated in the media informing the public of
an impending decision of the company to relocate from the Onne Oil and
Gas Export Free Zone in Rivers State to a new
base in Lagos.

In a swift reaction, the spokesperson for SNEPCO, Bamidele Odugbesan, denied the alleged relocation.

“The base will continue to be utilised by
the Shell Petroleum Development Company of Nigeria Limited (SPDC),
operator of the SPDC Joint Venture for SPDC Joint Venture operations.

SNEPCO’s operations are in the Bonga
Field 120 kilometers off Nigerian coast in the Gulf of Guinea and our
operations staff and contractors work offshore in Bonga,” he said.

 However, he also conceded
that “SNEPCo, which has been making use of SPDC’s logistics supply base
operated in Onne, is trying to develop its own alternative supply base
in Lagos. SNEPCo is
not planning to relocate any of its operations from anywhere to Lagos.”

The feeble reaction from the company has been unsuccessful in dousing the brewing tension the news has elicited.

The decision has already generated disaffection amongst the youths of the region towards the company.

In a peaceful protest, youths under the
umbrella of Onne Youth Council (OYC), expressed their grievances and
total condemnation of the move, urging the company to rescind its
alleged plan.

The youths also revealed that the planned relocation could lead to the loss of more than 5,000 direct and indirect jobs.

The Paramount Ruler of Onne Community,
John Dennis Osaronu, has also joined in the call for SNEPCO to
reconsider the decision to relocate its supply base to Lagos because of
the consequences on the people, the community and the
entire Niger Delta region.

There are many perspectives to examining
the plan to relocate. It can be examined from a strictly economic
perspective – impending job loss and impact on the Onne Free Trade Zone –
and it can also be viewed from the security perspective
– implications for peace and stability in the region.

Whichever perspective analysts choose, it
is undeniable that executing the alleged plan has wide implications for
the Onne Oil and Gas Free Trade Zone, the Onne Community, River State,
Niger Delta region and the country at large.

There is a truism that organizations are
corporate citizens and should be treated so. It is therefore important
for the company to consider other stakeholders outside its internal
system in arriving at a decision such as this
due to its wide-ranging impacts.

 Whilst the underpinning
motive for the alleged decision may have some business advantages for
the company either in the immediate or long term, its overall
consequence on Onne Free Trade
Zone and the entire region should attract equal consideration.

More so, as a foremost oil and gas
company in Nigeria that has operated in Onne for more than 20 years, the
planned relocation may also serve as impetus for other companies in the
Zone to follow suit.

And when this is encouraged the eventual consequence is a drastic drop in business activities in Onne.

This does not only affect the country in
terms of revenue loss, it will also lead to job loss and increase in
unemployment in an already volatile region.

As a case study for other Niger Delta
communities, Onne is practically built on the going concern of the
companies in the area, especially the Onne Free Trade Zone.

This suggests that any challenge faced by
Onne Free Trade Zone will directly impact the employment of youths in
the community. And the issue has the potential of escalating from a
community issue to a regional concern within the
shortest possible time.

The government clearly cannot afford a huge population of idle youths at this point in an already volatile region.

 It is too much of a risk to
ignore. It also sends a negative signal that Shell and its subsidiary
SNEPCO may not really be interested in ameliorating the plights of
people in the Niger Delta
region; rather it portrays the company as one willing to suck the
region without committing to its people.

Issues like this reinforce the perception
in some quarters that the government and the multinationals do not
really care about the Niger Delta region, a position that was pushed
forward by the Ijaw People’s Development Initiative
earlier in the year.

 More so this alleged
decision is coming at a time when Niger Delta people are demanding for
multinationals to relocate their headquarters to the region.

Whereas that call was amplified by the
Vice President, Prof. Yemi Osibanjo during one of his visits to the
region, it has now become a major demand by the leaders of the region.

However, this latest alleged decision is
potentially capable of injecting a negative dimension to the relatively
peaceful atmosphere of unending discussions for stability.

Ultimately, whilst it is difficult for
external powers to determine how a company is run, it is only
appropriate that Shell pays attention to the responses that have greeted
this decision and act accordingly.

 Observers have been left in
disbelief on what could have informed the alleged decision considering
that Onne is considered as one of the best managed ports in Nigeria and
the Onne Free Trade
Zone, which is the largest in the world, has continue to surpass
expectations.

More so, the Onne people have been friendly and receptive to companies operating in their community in an exemplary manner.

So far, the government has been silent on
the matter. The role of the government is important at this point to
understand the issues and provide useful perspectives to SNEPCO.

The contribution of SNEPCO to Onne through the Free Trade Zone is enormous and cannot be wished away.

Without companies like SNEPCO, the Onne
Oil and Gas Free Trade Zone would not have been able to employ the
number of youths it has on its payroll.

 At this point it is advisable to let sleeping dogs lie and not create unnecessary tension in the Niger Delta region.

The government has worked assiduously to ensure that relative peace is sustained in the Niger Delta.

And in fairness to both the Federal and
State governments, there has been a considerable absence of violence and
militancy in the region. Nigeria has consistently met its daily oil
production target due to this relative peace.

There is no need therefore to trigger
unnecessary disaffection amongst the people for a decision that has no
expediency to it. Besides, SNEPCO will do better having all its property
and equipment, including turbines, engine spares
close to its operations.