9.4.4 The Nigerian Government talks with Chinese oil companies and privatisation of the oil industry: what future for the Ogoni?

In the context of the booming economy of China and its increasing drive for energy resources, the Nigerian Government started to concretise talks with Chinese oil companies vividly interested in its rich natural reserves.

In 2005, China National Offshore Oil Corporation (CNOOC), the largest Chinese gas and oil producer, agreed to disburse close to US$2.3 billion for a 45 per cent stake in an oil block in the Niger Delta.1 In 2006, the Government offered the state-owned company China National Petroleum Corporation

(CNPC) four out of 17 oil exploration licences in an auction.2 Two of the oil explorations are located in the Niger Delta.3 In exchange for the drilling rights, China agreed to invest in Nigeria's infrastructure.4

Additionally, the media have reported that Shell may sell stakes in some of its oil and gas fields in Nigeria to CNOOC.5 The willingness of China to acquire its share of the oil industry is also facilitated by the intent of the Nigerian Federal Government to privatise the oil industry.6 The Federal Government has already approved licences to several independently-owned refineries.

Some may perceive the arrival of China in the Niger Delta as an improvement to the region's resources and as an opportunity for funding a better future for the Delta population. However so far, the opinion of the Niger Delta militants is squarely different; it has been reported that militants of the MEND have detonated a car bomb as a warning against China's further expansion in the region. Kidnapping of Chinese workers by militants has also been reported.7

Indeed, the general security situation surrounding the oil industry in the Niger Delta is still problematic. In its attempts to control the situation, "Nigeria has criticised Washington for failing to help protect the country's oil assets from rebel attack, forcing it to turn to other military suppliers, including China, for support".8 It might be said that concerns over the level of corruption within the Nigerian security forces and human rights violations have made the Americans reluctant to supply additional equipment. As a consequence, Nigeria has turned to China as a military ally to protect its oil fields, especially by providing supply. Considering further critique of China's commercial engagements with controversial regimes such as its involvement in Darfur related to the oil industry9 or its investment and military supplies in Zimbabwe and its loans to Angola one may doubt whether this development forecasts a better future for the Ogoni. It would probably depend firstly on the concretisation of promises related to the development of selected infrastructure by Chinese companies.