Thursday, 15 August 2013

IMPLICATIONS OF OIL AND GAS ACCOUNTING ON ECONOMY DEVELOPMENT OF NIGERIA (A STUDY OF NIGER DELTA)



CHAPTER ONE 
INTRODUCTION

1.1  Background to the study
The oil and gas industry in Nigeria is the largest industry and main generator of GNP in the West African nation which is also the continent most populous. Since the British discovered oil in the Niger Delta in the late 1950s, the oil and gas industry has been marred by political and economic strife largely due to a long instinct of corrupt military regimes and complicity of multinational corporations notably Royal Dutch Shell. Despite this, it has not until the early 1990s that the situation was given international attention, particularly following the murder of playwright and activist Ken Saro-Wiwa by the Nigerian provoking the immediate suspension of Nigeria from the Common Wealth of nations. Nigeria is identified by the international community and the firms in operation there as a major concern with regards to human rights and environmental degradation (Aina, 1991).
        Oil and gas production in Nigeria has been mixed by bag of fortune and misfortune of blessings and curses, depending on who is feeling that effect. For the country, it has been a large fortune. It is the source of her wealth, accounting for about 90% of her foreign exchange earnings; it is the source from which governments at the federal, state and local levels substantially fund their developmental programmes, a source of employment. Most desired transfer of technology was to extent been achieved especially in the areas of exploration and production, provision of internal energy requirement, increased income per capital (Ekpo, 2004). Nigerians membership of such important bodies as the World Petroleum Congress (WPC), Organisation of Petroleum Exporting Countries (OPEC) and African Petroleum Producers Association (APPA) has raised the country's profile internationally.
        In other words, that Nigeria is a force to reckon with in the country of nations is arguably attributable to her being an oil producing country (Adams, 1999). For the oil bearing communities in the Niger Delta, however, oil has been more of a curse than a blessing.
        In communities where oil exploration and production are carried out on shore, deforestation, erosion and destroyed farm lands are the main signposts for this gift of nature. The Nigerian Content Policy initiated by the Obasanjo’s administration to help develop local capacity building in the Nigeria oil and gas sector with a view to ensuring that Nigeria participate actively in the operations in the sector.   
        In the early 1990s where democratic government initiated a series of a market oriented policy reforms to integrate the economy towards globalization and economic growth. A remarkable progress in terms of growth, investment and employment has been achieved. It is in view of this that the researcher is writing on the “implication of oil and gas accounting on the economy development of Nigeria in Niger Delta”.
1.2  Statement of the problem       
Since the introduction of oil and gas exploration in Nigeria in the place of agricultural sector, the problem surrounding this sector has been on how the account of……

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