Recommended $10b for ETP yearly a tall financial order
By Edu Abade,
Despite the emergence of the Climate Change Act 2021 and an Energy Transition Plan in Nigeria, there are strong indications that the Federal Government is only interested in carbon market mechanisms and following other countries of the world to make commitments to mitigating climate change impact and initiating an energy transition plan without adequate and urgent action strategy towards achieving clear objectives.
This is betrayed by renewed interest in the exploration of fossil fuels in Bauchi, Nasarawa and the Lake Chad Basin, which the Federal Government celebrated last year with the commissioning of oil drilling facilities in the Northern part of the country and encouragement of International Oil Companies’ (IOCs) divestments from Nigeria’s onshore facilities being acquired by local investors with lack of capacity and adequate financial requirements to explore alternative energy sources and mitigate the impacts of climate change.
Following the development, stakeholders and environmental activities argued that divestment is a global initiative that has been hijacked by the IOCs since 2021 with a view to evading accountability and take responsibility for the devastation caused by over six decades of oil exploration in the Niger Delta, particularly exacerbated by continued gas flaring and oil spills.
They stated this during a Webinar organised for stakeholders and journalists by the Environmental Rights Action/ Friends of the Earth Nigeria (ERA/FoEN) in Lagos with the theme: Nigeria’s Climate Change Act and The Energy Transition Plan: Matters Arising, stressing that the theme of the Webinar remained very strategic based on issues of the moment as they affect energy, climate change and the country’s overall economic well being.
Executive Director of ERA/FoEN, Barrister Chima Williams, who opened discussions on the topic, pointed out that the IOCs operating in Nigeria, especially Shell, Chevron, ExxonMobil and the Nigeria Agip Oil Company (NAOC), among others were turning the issue of divestments on its head because the oil industry induced the issues in the first place, insisting that civil society groups, the media and other stakeholders must expose the contradictions of the issues being flaunted by the IOCs.
He also faulted the arguments of the oil giants about oil theft and claims of sabotage being put forward by the Ministry of Petroleum Resources and challenged the industry and ministry to provide adequate data and evidence to substantiate their claims, adding that since the challenge was thrown at them, there has been a drastic reduction in incidents of oil theft and claims of sabotage.
Williams, who noted that the issue of oil theft and sabotage had been replaced by recurring explosions, which he said, has increased across major oil production frontlines in the country, insisted that the industry players should provide their data and indices to convince Nigerians of their claims.
He also deflated the IOCs’ argument on double taxation as another reason for divesting from onshore to offshore, adding: “We have come to the conclusion that they are divesting to the deep sea and shallow waters where they know that communities lack the capacity to monitor their activities. But we have also resolved to continue to expose the lies behind the IOCs’ divestments.
“This is because they are leaving their legacy production lines and selling their weary facilities and assets to incompetent local oil companies, as displayed in the case of AITEO’s huge oil leakage in Bayelsa. Divesting multinational oil companies have milked the country dry from decades of oil exploration and are now leaving behind their liabilities, and as such, their argument is standing on its head.
“However, we are happy that the divestment argument is gaining attention. ERA/FoEN had earlier recommended a $100 billion Environmental Remediation Bond to be put together by both the industry and investment companies to properly clean up the mess in the Niger Delta.”
Also speaking during the Webinar, Director, Centre for Environment Media and Development Communication (CEMDC), Constance Meju, expressed concern about how women have been alienated from engagements in the oil industry, maintaining that the IOCs have messed up the land and waters on which women and children largely depend in the Niger Delta.
She lamented that in an era in which the world is moving away from fossil fuels, the Nigerian government is encouraging oil and gas prospecting in the North, adding that in all the challenges of devastation in the Niger Delta, women have not been recognised and carried along in any discussions in Akwa Ibom, Bayelsa, Delta and Rivers and other oil-producing states of the country.
Meju bemoaned the fact that women are usually displaced in the process of exploring oil and gas in all locations, especially in the Niger Delta, which would continue when full exploration activities begin in the North, adding: “Worse still, women are not compensated even as members of host communities, who suffer displacements and devastation of their lands. Also, over 200 children died in one year in the Niger Delta from contaminated water that caused ruptured intestines among children.”
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Speaking further, she said: “Women have remained neglected even as the Petroleum Industry Act (PIA) 2021 stipulates that they should be carried along, but nothing has come out of it yet, from either the oil companies or the Federal Government and the Ministry of Petroleum Resources. Even the Ministry of Humanitarian Affairs and Disaster Management has done nothing to mitigate the impacts of severe flooding in the Niger Delta.
“For instance, women did not also benefit anything from the N1 billion provided for flood victims in Rivers and N850 million in Bayelsa and so, in addition to the general economic hardship, women have been triple devastated. Also, regrettably, on actions that will create some relief on climate change, nothing has been done.
“Besides, the National Gender Transition Plan on climate change is not being pursued with the seriousness it deserves and in our opinion, there can never be just transition, especially for women the way things are presently. We demand that Niger Delta women should be carried along. We need domestication of the Gender Action Plan because there is a huge disconnect between policymakers and local women. As things stand, our lives are endangered and women are crying for intervention from all stakeholders.”
On his part, Olamide Martins of the Corporate Accountability and Public Participation Africa (CAPPA), who highlighted the limitations of the Climate Change Act and Energy Transition Plan, explained that having been signed into law on November 18, 2021, insisting that coming after 61 years of independence, 22 years of democracy from the sixth Assembly up to the ninth and just a week after COP26, the process leading to the Act could only be described as “a slow progress on a dangling ladder.”
Maintaining that the NCC-Council is one of the most robust in Nigeria’s policy history, he wondered why the council comprised as much as 13 ministers with the President as Chairman, Vice President as Vice Chairman and the CBN Governor, Nigeria Governors Forum (NGF), National Security Adviser (NSA), Association of Local Governments of Nigeria (ALGON), Private Sector, People Living With Disabilities (PLWDs), Women and Youth Representatives, CSOs as members, while the Director General of the Council will serve as its Secretary.
On its mandate, he pointed out that the Council was empowered to make policies and have decision-making powers in Nigeria; have the obligation to set targets for sectors; regulation of Green-House Gas emissions; approve and oversee the implementation of the Climate Change Action Plan; administer the Climate Change Fund established under the Act; formulate guidelines for determining vulnerability to climate change impact and mobilise financial resources to support policy on climate change actions.
Others are the development of carbon tax mechanism for Nigeria with the Federal Inland Revenue Service (FIRS); development of carbon emission trading with the Federal Ministry of the Environment (FMOE); the review of international agreements on climate change; dissemination of relevant information on climate change; make technical recommendations on the scientific and legal matters) relating to climate change; supervise the Secretariat of the National Council and collaborate with the Nigeria Sovereign Green Bond in meeting Nigeria’s Nationally Determined Contributions (NDCs).
Its limitations, he explained, include vested interests in the inclusion of CSOs in the NCC-Council; duplicity of regulators (DCC & NCCC); bold embrace of market mechanisms (capital solution) and that two years into the emergence of the Act, there is no National Action Plan yet, even as the Federal Government encourages the commencement of gas and oil exploration in Nassarawa and Bauchi states.
Martins, who decried what he described as “the loud silence of the Act on the progressive divestments of IOCs in Nigeria,” pointed out that other limitations are inconsistencies with the NDCs; the opaqueness in Hydrocarbon tax as provided in the Petroleum Industry Act (PIA) and carbon tax in the NCCC, wondering: Who gets what and how?
Speaking on the Energy Transition Plan (ETP), he stated that the ETP targets the reduction of emissions, development of the power sector and achieving carbon neutrality by 2060 with the objectives of lifting no fewer than 100 million Nigerians out of poverty and drive economic growth, as well as bringing modern energy services to all Nigerians.
He said other objectives are to manage the expected long-term job losses in the oil sector due to the reduced global fossil-fuel demand, play leadership role in Africa by promoting a fair, inclusive and equitable energy transition in Africa that will include Gas as a “transitionary fuel” and streamline existing and new government-related energy transition initiatives with special focus on power, cooking, oil and gas, transportation and industries.
In the same vein, limitations of the ETP include the huge influence of foreign interests, the tall financial order of $10 billion yearly, investment window for big polluters, majorly multinational and local oil companies and the advancement of anti-people initiatives and promotion of false solutions
In his recommendations for the NCC and ETP, he maintained that the Act and further engagements on the issues must address the operational bureaucracy of the NCCC, harmonise the inconsistencies inherent in them, institute Environmental Impact Assessment (EIA) with adequate feedback mechanisms, as well as build and leverage internal competence and close-up foreign influences to ensure success and sustainability of climate change actions and energy transition plans in the short, medium and long-terms.
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