It may be instructive at the outset to state that Nigeria’s oil and gas potentials are not too great by any standard of measure on per capita basis, for example, our crude oil reserves is one of the smallest within the Organization of Petroleum Exporting Countries (OPEC) see Chart. Saudi Arabia with crude oil reserves of some 260 billion barrels has a population of only 14.5 million. Iraq, with a population of 17 .8 million reports a level of 100 billion barrels. By contrast, Nigeria’s reserves currently estimated at 21 billion barrels is controlled by a population of close to 100 million people, and apart from the deep offshore, prospect for a major oil find is remote. Similar pattern is found in gas where Iran dominates the world reserve base with a relatively small population. Nigeria’s reserves are put at 164 trillion standard cubic feet with a large and growing population. Because economic development is centered on people, frequently measured as income per capita, it is immediately very clear that Nigeria’s economic development potential from petroleum is limited. This limitation is exacerbated by the nature of petroleum itself being a wasting asset in the sense that once it is produced it is not replaceable in situ, and unless it is converted to an income creating asset. it may be lost for ever. Consequently, the growing over-dependence on oil for foreign exchange earnings, government revenue and energy is the direct result of failures in investing for economic diversification.

Nevertheless, some remarkable achievements have been made notably, the development of social and economic infrastructure which are now crumbling because of poor maintenance. It is important also to note that Nigeria has been able to establish a stable co-operation framework with multinational oil companies which ensures continuing oil production in the first place. More policy efforts, including strategic initiatives are however, urgent, and it is my intention in this presentation to identify the main thrusts, looking at the Upstream and Downstream of the Petroleum Sector…(by C.C. Ozumba)