Insanity has been defined by social analysts as doing same thing over and over and getting same result – especially when the outcome is negative, forlorn and full of abysmal mistakes.  The government of Nigeria is on the verge of either submerging itself in the world of socio-economic psychosis or proving that her economic rationality through the recent removal of oil subsidy is sane enough and would be a free enterprise venture that could catapult this most populous African nation to better life.

Diezani Alison Madueke
Nigeria's Petroleum Minister

 Apart from the recent action of the government to remove oil subsidy as a way of deregulating the petroleum sector and ensuring economic consolidation, various governments have tried various economic models such as the structural adjustment program (SAP), which gave birth to austerity  measure as a result of  an ill – taken IMF advise that shattered the economic foundations of the country and devastated the strength of the Naira – Nigeria’s currency which before the  mid- 1980s was well respected in the international market.

Ngozi Okonji - Iweala
Nigeria's Finance Minister

The current removal of oil subsidy in Nigeria, Africa’s prime producer and a high ranking member of OPEC is creating uproar and building up a cyclone which may disperse like the Arab Spring.  According to many locals, oil subsidy is one visible thing the citizens enjoy from the wealth of oil revenues in their country. The removal of oil subsidy seems to be total denial, callous, negligence and a path way to Armageddon.

 There is no doubt that Nigeria as one of the nations blessed with abundant mineral resources, but suffering from acute “Dutch disease” needs a panacea for her economic malady. The government adduced that deregulation of the downstream petroleum sector through the removal of government control, and shrinking the humongous rules and regulations that have restrained free enterprise could be a right treatment for the cure of the inherent Dutch disease in a nation that has all it takes in terms of human capital and natural resources to be a frontline global economy.

 Against the backdrop of various intellectual arguments that the swift way the government of Nigeria implemented the removal of the oil subsidy is tantamount to removing an ailing tooth with a bulldozer and that it would have being better for the removal of oil subsidy to be done gradually and in phases. The government has given a didactic explanation that the removal of subsidies in phases has never worked in any country and that there is a strong likelihood that it would work in Nigeria. The government pinpointed countries such as Malaysia, Indonesia and Ethiopia as some of the nations that completely deregulated their downstream petroleum sector and succeeded in removing oil subsidies in a jab.  While the government’s position sounds eclectic and academic, the reality is that they did not consider the cultural content of Nigeria and its geopolitical complexity. Take for instance democracy has not worked in all nations as it has worked in United States of America.

 By leapfrogging to implement the removal of oil subsidy before implementing the Petroleum Industry Bill (PIB) which could have paved the way for major deregulations in the petroleum sector and provide vital fiscal incentives is like putting the cart before the horse and committing economic hara-kiri.

 Before rushing into a full force removal of the oil subsidy, government would have shown that it is on the side of the poor masses who they claim will be less affected by their action by first providing enabling environment such as building more refineries to lessen scarcity of petroleum products, construct railroads to lower the cost of transportation in the country, build new road networks and repair existing ones – which some are in deplorable state, ensure mass housing  and encourage local agricultural industry. 

 It is a parody to say that the rich will be more affected by the removal of oil subsidy because they are the ones that drive massive gas galloping cars and travel frequently. It is a big travesty and muddles the water of rationality. The government forgets that at least the rich have a means of survival and getting on and the poor will depend on the rich that control the transportation industry, that are the landlords, owners of industries, business, fuel stations, etc and they will transfer the humongous cost of the burden to the poor through skyrocketing the price of goods and services beyond the meager pockets of the poor.  This will translate to extreme hardship and unparallel abject poverty.

 Although, that the government deserves a pat on the back for beginning to think of how to diversify the economy of the country which is about experiencing more growth and the government aims to use the resources freed from the subsidy removal to launch alleviating measures, it becomes apparent that the nation has not really managed effectively the surplus revenue from oil windfalls which the country has been blessed with since the beginning of the Gulf War.  Again, the government knows that it could still garner huge revenue if it can gloriously fight the endemic corruption in the country and fearlessly stop oil bunkering through which the country loses millions of dollars in weekly basis.

 In this circumstance, ensuring sanity in the utilization of the mass oil revenue in the country without robbing Peter to pay Paul is for the government of Nigeria to buffer up the good work it has already started in showing extractive transparency, fighting corruption without riddling it with internal politics and initiating programs that would bring to light establishment of infrastructures that could cushion and alleviate the stringent effects of the yanking of oil subsidy. If free enterprise or market economy appeals to the government of Nigeria as is the vogue in every democratic system, the government of President Jonathan should start to bell the cat by shrinking his government. There are multi government agencies and ministries doing similar functions and unnecessarily wasting government revenues which should have been used in launching the proposed alleviating measures.  Another way of generating more revenue internally without emasculating the already suffering masses is for government to cut down the salaries of national legislators and the executives.  This is what economic sanity means in an altar of transparency propelled through exemplary and committed leadership.

It’s no fairy tale that the world energy demand will continue to increase, amid the growth in human population, the gargantuan energy appetite of United States and the buoyancy of the emerging economies of Brazil, China and India. According to OPEC, the world oil demand for 2010 was 85.5mb/d and is estimated to reach 91.0mb/d in 2015. Currently, both OPEC and Non-OPEC Producing nations supply 81.2mb/d of oil into the market and a projection of about 84.7mb/d market supply in 2011. In order to meet the short fall in world’s energy demand through crude oil, the new thinking is to enhance increase utilization of natural gas, nuclear energy, the emerging shale gas and alternatives sources such as solar, wind energy, geothermal and biofuel in the global energy mix.

Cattenom Nuclear Power Plant

Source: Wikipedia

While other alternative sources of energy are comparatively good to go along with fossil fuels to balance the world energy demand, it will amount to colossal mistake to continue to incorporate nuclear energy as part of the energy of the future. Again, it is a monumental misnomer to dub nuclear energy as a “clean energy”.  What is really clean about energy that emanates from nuclear reactors that portend the ability to annihilate a community in a less controllable way?  Clean, you may say, that nuclear power plants do not emit carbon dioxide, sulfur dioxide, or nitrogen which form the greenhouse gases that threaten the environment. However, during the mining of uranium which is the main substance used in nuclear plants, fossil fuels are used , which in the process can still release gases in the environment .

 Deepwater and offshore drilling of oil has its own dangers such as the Horizon rig accident at the Gulf of Mexico and the massive oil spill in Alaska. There is no way the dangers that emanate from oil drill could be compared to what happens when a nuclear plant explodes. Globally oil stands out in the world energy mix and it is the only fuel for now that closely meets the world’s energy demands. Recently enacted oil exploration and production policies by diverse producing nations to end gas flaring and met high environmental standards and the availability of technologies have tremendously helped in the control of carbon emission in the atmosphere.

.           As if the Chernobyl nuclear disaster of April 26, 1986 in Ukraine of the former Soviet Union, was not enough lesson for the users, developers and proponents of nuclear energy to recede; the recent Fukushima nuclear reactors explosion in Japan due to the tsunami and earthquake that happened this March, might push nuclear -enriched nations and aspiring ones to pause, ponder and seek for another path to meet their energy demand and totally stop nuclear proliferation.

            Whether it is the development and use of civil nuclear to meet a nation’s energy demand or nuclear armament to enhance military superiority; there are better alternatives. The fossil fuel – oil in all ramifications is a better alternative to the so called clean energy derived from nuclear plants. Oil will for the next fifty years continue to lead the world energy mix. For the use of nuclear armament to show military strength, peace and respect for one another is the answer.

 The Chernobyl nuclear disaster that happened in the town of Pripyat in Ukraine in 1986 during a test, which was a level 7 event according to the International Nuclear Event Scale, was considered one of the worst nuclear power plant accidents in the world. The catastrophe consumed many lives and maimed people for life. Despite the human loss, and economic misfortunes it brought to the region, Ukraine continued to operate the plant until 2000.  After experiencing the devastation of the dropping of the “Little Boy” in Hiroshima and the “Fat Man” in Nagasaki by the United States in Japan during the World War 11 in August 1945, which killed more than 400,000 people and crushed the economy of the country; the Land of the rising sun as Japan is called continued to pursue nuclear development and use.  Like Japan, world powers such as United States, France, Britain, China and countries such as North Korean, Israel, India and many others have continued to maintain and develop nuclear plants despite global outcries.

            The recent melting of fuel rods inside damaged reactors at the Fukushima plant in Japan has tendency of causing serious radioactive leaks. Radioactive materials that will be blasted into the atmosphere fro the Fukushima can easily reach the West Coast of United States and beyond. According to Dr. John Large, a nuclear expert who has shown concern on the extent of the propagation of the radioactive materials said that where the radiation ends up is “in the laps of the gods.” This statement from an expert forebodes deep danger that this might turn out to be a universal catastrophe.  Professor Maku, another expert said “It might take between 50 -100 years to finish cleaning up the radioactive menace of the failed Fukushima plant.”

Anacortes Refinery (Tesoro), on the north end of March Point southeast of Anacortes, Washington

Source: Wikipedia

The actions of countries such as Germany, Switzerland and Italy to set up plans to close their nuclear plans are commendable.  And in so doing, these nations are showing their love for humanity and also charting pathway for global peace. In the first week of June, after a massive anti-nuclear protest following the Fukushima disaster, German Chancellor Angela Merkel gave a detailed proposal to close all 17 nuclear plants of Germany by 2022. Nuclear plants produce about a quarter of the country’s electricity. Chancellor Merkel is proposing that Germany get its extra energy supply through wind farms and other sources, but not nuclear reactors.  Philipp Rosler, German’s Federal Economics Minister estimated that the plan to shut down nuclear plants in the country will raise electricity cost to consumers by one cent per kilowatt/hour. This will amount to yearly increase of about $57 per family. Truly, in times of economic crisis as the world is wriggling through every cent makes a big sense. However, it is not comparable to the dangers of nuclear reactors and the benefit of not having them. The monetary value of life is priceless. 

            The government of Switzerland after a stream of anti-nuclear protest also announced to decommission the county’s five existing reactors by the end of 2034. Switzerland gets 40% of its current energy from nuclear plants. The country has marshaled out plans to substitute its energy mix by increasing utilization of renewable energy.  Against, the wish of Berlusconi’s government that wanted to open up Italy’s energy program in 2014, the citizens of that country voted en masse to put an end to nuclear plants.

            Germany has shown the lead as the largest industrial economy to propose plans for shutting down its nuclear plants. Whether nuclear plants provide 60 – 80% of electricity need of any country, there is more to life than what we think at present. The world has a choice to make to choose life or death by either continuing the use and proliferation of nuclear plants or to embrace fossil fuel and other alternative energy to meet up global demand. Since well controlled carbon is source of life, the world is better of with the fossil fuel.

Related Stories:

Germany : nuclear power plants to close by 2022

http://www.bbc.co.uk/news/world-europe-135922206

What will a nyuclear -Free Germany Cost?

http://www.technologyreview/energy/37693/?p1=MstEm/

Italy's Voters Scrap Nuclear Energy!

http://www.commondreams.org/view/2011/06/13-5?

Picture: President Idris Derby of Chad

The recent Memorandum of Understanding signed by Sudapet, Sudan’s state- owned petroleum company and Chad’s state-run SHT is

The fact of the matter remains that both Sudapet and SHT are facing human capital shortage . With a 1.5 billion barrels oil reserve, Chad has began to increase production in its fields and working hard to boost daily production from 0.14 mb/d to 0.17 mb/d amid the new discoveries by the Chinese national Petroleum Company (CNPC).  Chad is in dire need of manpower to boost production in the oil fields, increase work progress in the new 300-km oil pipeline construction that will transport crude from koudalwa field to the Djarmaya refinery, being built by the joint venture of CNPC and Chad state-company, located north of N’Djamena. Idris Derby’s government has an urgent need to generate economic development in this Sub-Saharan Africa country.

Production increase; the need to boost the economy, and also the expulsion  of  TexacoChevron and Petronas of Malaysia from Chad  due to a  tax imbroglio that went sour which led to the firing in 2009 of then Chad’s Petroleum Minister, Mahamat Nasser Hassan and the ministers for livestock and planning created the beginning of manpower shortage in Chad’s burgeoning petroleum industry. The exit of TexacoChevron and Petronas was a move that many industry observers commented as a strategy to bring in the Chinese national company which Derby’s government felt was offering them better deal in terms of infrastructure development. Before the exit of the American and Malaysian company, about 60% of Chad’s production was the responsibility of the duo.

On the side of Sudan which has about 5.0 billion oil reserves and the third largest producer in Sub-Saharan Africa, Sudapet has began to sense the symptom of human capital anemia in its circle. Come July this year, South Sudan where most of Sudan’s oil fields are located is expected to secede and become Africa’s newest country based on the result of the January referendum.  First, most of the south Sudanese that work in the oil sector will automatically shift to work for the about to be formed South Sudan national Oil firm.  This depletion in manpower is what Sudapet is trying to strategically balance at a cheaper cost through mutual understanding with neighboring Chad. Secondly, it has become obvious that the economy of Sudan which to a good extent depends on the revenue from oil will be highly affected once the south secedes. However, both sides have a grip on each others throat. 

Oil accounts for more than 90% of government revenue in the south and about 40% of the government in the north. While the 40% of the revenue which the north generates from oil export helps to cushion development in the region, a further reduction in production and sales of oil will mean disaster for the north.  Juba will definitely be in jeopardy and economically devastated  if Khartoum decides to close the pipeline that transports crude oil from the south to the port in the north. It is this foreseen shortage in manpower and shortfall in its economic basket that north Sudan wants to forestall by engineering a quick marriage with Chad.

Above all, the creation of a joint venture oil company between Chad and Sudan will also be a monumental victory for China, who through its national petroleum company has succeeded in expanding the new china belt in Africa known as “SCAAN” (Sudan, Chad, Angola, Algeria and Niger). As a result of proximity, economic need and religious –cum-cultural similarity it is easier for China to woo Chad massively through a strategic alliance with Sudan. This new venture will give China a bigger opportunity to have wider operations in both countries which has already become visible.  Now about 45% of China’s crude supply from Africa comes from Sudan. With the expulsion of Chevron in both countries and the exit of Petronas in Chad, China has become the domineering foreign oil company..

Forecast:  Violent protests likely ahead of contentious general elections in Uganda

Analysis:  Ugandans are scheduled to go to the polls on February 18th to vote in a presidential and parliamentary election. Incumbent President Yoweri Museveni, who is contesting again in a fourth consecutive term, is poised to win, which will very likely incite opposition unrest and protests. According to local reports, opposition parties have stated that the Electoral Commission was not transparent and had been set up to favor Museveni and are therefore gearing up to tabulate and announce their own results. Museveni’s government has, in recent years, been perceived as very corrupt and insensitive to the basic needs of the masses. In the weeks leading up to the general elections, organized demonstrations by opposition leaders to protest against the Museveni government will very likely take place. Violent clashes with security forces, and/ or pro-Museveni groups can be expected in Kampala, Entebbe and other large towns. Target areas for protestors include the area around the Electoral Commission’s headquarters, while government infrastructure and some assets of political parties will likely be vandalized. Key electoral candidates are also at risk of attack. Armed militias, according to local reports, are being organized by local political parties to intimidate and frustrate voters during the February 18th election day. However, any indication of election fraud and a lack of free and fair voting process will very likely incite violent confrontations between anti-government elements and security forces. Looting of shops, damage to vehicles and commercial properties will likely take place. Furthermore, political grievances and anti-government protests could probably turn along ethnic lines, and members of Museveni’s ethnic Banyankole group, including supporters from the Buganda kingdom, may be attacked. With the current political impasse in Cote d’Ivoire, we could very well see a situation akin to Kenya’s 2007 post election violence, and much worse than violent incidents that took place during Uganda’s 2001 and 2006 elections. Energy assets, particularly located in western Uganda towns like Masindi are at high risk of damage during political unrest. A probable terror attack ahead of the polls by Somali group, al-Shabaab, which is opposed to Ugandan troop presence in Somalia, is also present. The Museveni government will temporarily close down Uganda’s borders during the election, which will likely disrupt the flow of cargo from Kenya.

    Related Articles:

    Uganda's Presidential election

     www.cfr.org

    Ugandans expect  better election

     www.monitor.co.ug/News/National/-/6888334/934060/-/xos8ov

    Uganda's Election Chief Promises Better Results in 2011

     abcnews.go/.../ugandas...raps-election/story?id=12121231