Niger Delta

==Nigerian oil==
{{main|Petroleum industry in Nigeria}}
Nigeria has become [[West Africa]]'s biggest producer of petroleum. Some {{convert|2|Moilbbl|m3}} per day are extracted in the Niger Delta, with an estimated 38 billion barrels of reserves.<ref>{{cite journal|last=Isumonah|first=V. Adelfemi|title=Armed Society in the Niger Delta|journal=Armed Forces & Society|year=2013|volume=39|issue=2|pages=331–358|doi=10.1177/0095327x12446925|s2cid=110566551}}</ref> The first oil operations in the region began in the 1950s and were undertaken by multinational corporations, which provided Nigeria with necessary technological and financial resources to extract oil.<ref>{{cite book |last=Pearson |first=Scott R. |title=Petroleum and the Nigerian Economy |location=Stanford |publisher=Stanford University Press |year=1970 |isbn=0-8047-0749-9 |page=13 }}</ref> Since 1975, the region has accounted for more than 75% of Nigeria's [[export]] earnings.<ref>{{Cite book|last=Akpeninor|first=James Ohwofasa|url=https://books.google.com/books?id=ESk7b8iKIU0C&pg=PA576 |title=Giant in the Sun: Echoes of Looming Revolution?|date=2012-08-28|publisher=AuthorHouse|isbn=978-1-4772-1868-6|language=en}}</ref> Together oil and natural gas extraction comprise "97 per cent of Nigeria's foreign exchange revenues".<ref>''Nigeria: Petroleum Pollution and Poverty in the Niger Delta''. United Kingdom: Amnesty International Publications International Secretariat, 2009, p. 10.</ref> Much of the [[natural gas]] extracted in oil wells in the delta is immediately burned, or [[gas flaring|flared]], into the air at a rate of approximately 70 million m<sup>3</sup> per day. This is equivalent to 41% of African natural gas consumption and forms the largest single source of [[greenhouse gas emissions]] on the planet.{{Citation needed|date=October 2013}} In 2003, about 99% of excess gas was flared in the Niger Delta,<ref>{{cite web|title=Nigeria's First National Communication Under the United Nations Framework Convention on Climate Change |work=UNFCC |date=Nov 2003 |access-date=24 January 2009 |url=http://unfccc.int/resource/docs/natc/niganc1.pdf |url-status=dead |archive-url=https://web.archive.org/web/20090115182631/http://unfccc.int/resource/docs/natc/niganc1.pdf |archive-date=15 January 2009 }}</ref> although this value has fallen to 11% in 2010.<ref>[http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTOGMC/EXTGGFR/0,,contentMDK:22137498~pagePK:64168445~piPK:64168309~theSitePK:578069,00.html Global Gas Flaring reduction, The World Bank] {{Webarchive|url=https://web.archive.org/web/20120301124210/http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTOGMC/EXTGGFR/0,,contentMDK:22137498~pagePK:64168445~piPK:64168309~theSitePK:578069,00.html |date=2012-03-01 }}, "Estimated Flared Volumes from Satellite Data, 2006–2010."</ref> (See also [[Gas flaring#Volume|gas flaring volumes]]). The biggest gas flaring company is the Shell Petroleum Development Company of Nigeria Ltd, a joint venture that is majority owned by the Nigerian government. In Nigeria, "...despite regulations introduced 20 years ago to outlaw the practice, most associated gas is flared, causing local pollution and contributing to climate change."<ref>{{cite web |title=Gas Flaring in Nigeria |work=Friends of the Earth |date=October 2004 |access-date=24 January 2009 |url=http://www.foe.co.uk/resource/media_briefing/gasflaringinnigeria.pdf |archive-url=https://web.archive.org/web/20090225211133/http://www.foe.co.uk/resource/media_briefing/gasflaringinnigeria.pdf |archive-date=25 February 2009 |url-status=live }}</ref> The environmental devastation associated with the industry and the lack of distribution of oil wealth have been the source and/or key aggravating factors of numerous environmental movements and inter-ethnic conflicts in the region, including recent guerrilla activity by MEND.

In September 2012 [[Eland Oil & Gas]] purchased a 45% interest in OML 40, with its partner Starcrest Energy Nigeria Limited, from the Shell Group. They intend to recommission the existing infrastructure and restart existing wells to re-commence production at an initial gross rate of {{convert|2500|oilbbl|m3}} of oil per day with a target to grow gross production to {{convert|50,000|oilbbl|m3}} of oil per day within four years.

===Oil revenue derivation===
Oil revenue allocation has been the subject of much contention well before Nigeria gained its independence. Allocations have varied from as much as 50%, owing to the [[Nigerian First Republic|First Republic's]] high degree of regional autonomy, and as low as 10% during the military dictatorships.

{| class="wikitable"
|+Oil revenue sharing formula
! Year !! Federal !! State* !! Local !! Special Projects !! Derivation Formula**
|-
| 1958 || 40% || 60% || 0% || 0% || 50%
|-
| 1968 || 80% || 20% || 0% || 0% || 10%
|-
| 1977 || 75% || 22% || 3% || 0% || 10%
|-
| 1982 || 55% || 32.5% || 10% || 2.5% || 10%
|-
| 1989 || 50% || 24% || 15% || 11% || 10%
|-
| 1995 || 48.5% || 24% || 20% || 7.5% || 13%
|-
| 2001 || 48.5% || 24% || 20% || 7.5% || 13%
|}

''* State allocations are based on 5 criteria: equality (equal shares per state), population, social development, land mass, and revenue generation. ''

''**The derivation formula refers to the percentage of the revenue oil-producing states retain from taxes on oil and other natural resources produced in the state.'' [http://info.worldbank.org/etools/docs/library/5783/State_and_Governance_Nigeria.htm World Bank Report]