This study centre’s on the impact of oil industry in the Economic
Development of Nigeria. In investing the above data were obtained
through questionnaires administration method. The mean analysis method
was used to analyzed the responses, elated from respondents and
meaningful conclusion drawn from it, it was discovered that factors like
the oil industry serves as the government revenue by paying tax,
granting loan to farmers to improve agriculture, creating employment
opportunity, providing social amenities are some of the impact of the
oil industry in order to improve the Economic Development of Nigeria.
TABLE OF CONTENTS
Table of Contents
List of Tables
CHAPTER 1: INTRODUCTION
Background of the Study
Statement of Problems
Objectives of the study
Significance of the study
Delimitation of Study
Limitation of the Study
Definition of Term
CHAPTER II: REVIEW OF THE RELATED LITERATURE
2.1 History of Shell in Nigeria
2.2 History of Government Participation in the Oil Industry
2.3 Oil and the Nigeria Economy (Government Expenditure)
2.4 Agriculture Sector
2.5 Government Revenue
2.6 Summary of literature Review
CHAPTER III: RESEARCH METHODS
3.1 Research Design
3.2 Area of Study
3.3 Population of the Study
3.4 Sample and Sampling Procedures
3.5 Instrument of Data Collections
3.6 validation of the instrument
3.7 Reliability of the Data
3.8 Method of Data Analysis
CHAPTER IV: DATA ANALYSIS AND RESULT
4.1 Research Question 1
4.2 Research Question 2
4.3 Research Question 3
4.4 Summary of Findings
CHAPTER V: SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.4 Suggestion for further Students
LIST OF TABLES
Table1: Respondent’s Responses on the effectiveness of oil Industry in the Economic Development of Nigeria.
Table2: Respondent’s Responses on the major
factors Limiting against the efficiency
of oil Industry in the Economic Development of Nigeria.
Table3: Respondent’s Responses on the Possible
Measures and Strategies which could be employ to
enhance the productivity of oil industry for the
Economic Development of Nigeria.
In this chapter, we will discuss on the background of the
study, statement of problem, purpose of the study, significance and some
research questions, the scope and the limitation of the study.
1.1 BACKGROUND OF THE STUDY
Oil is said to be a mixture of organic chemical derived mainly from
the remains of microscopic plants and animal that lives in sees millions
Special condition and great length of times were needed for these
remains to undergo complex chemical changes to for oil. These are
sometimes concentrated in accumulations which man can detect and
Oil exploitation began more than a hundred years ago, when drilling
was carried out near oil seeps which indicated that oil lay below the
surface. Today, much more sophisticated techniques are employed such as
seismic surveying and satellite imaging, powerful computers assist
geologist in interpreting their finding. At the end of the day however,
only the drill can determine whether or not oil lies blow the ground.
Nigeria which has among the world leading producers of palm oil for
over two centuries has suddenly become one of the nations of the world
with an average production of 2.3millions of barrels per day.
Nigeria’s oil industry has an interesting element in common with the
country’s once celebrating palm oil industry. The palm oil trade was a
crucial factors influencing the British to maintain and later Amex the
territory (The oil Rivers protectorates) in the later party of the
19th century, at the peak of the European scramble for Africa. This is
the same location that today habours most of the Nigeria oil
exploitation. The oil industry in Nigeria is one of the leading sectors
of the economy. It has risen to position of prominence and has become
the pivot of the Nigerian economy since its inception in 1952s. However,
after two decade of the oil boom, the industrialization of the economy
has remained a mirage.
Nigeria hitherto was on agriculture producing economy in the past the
export of the economy consisted mainly of agricultural products such as
cocoa, rubber and groundnut etc. the picture has changed dramatically
and lilted towards the oil industry while other sectors of the economy
including agriculture have contained o lag behind. Little wonder then
that the country have contained import food substantially which is
ironical in view of the fact that agricultural is still the mainstay of
the economy employing about seventy (70) percent of the population.
By the earlier 1990s, petroleum production accounted for over ninety
(90) percent of foreign exchange receipts (oil export accounted for
ninety seven (97) percent of local export receipts) ten (10) percent of
GDP. However, more importantly, the rising oil revenue and declining GDP
of the late 1980s suggest that the impact of the oil boom in the
earlier decades was so detrimental to non-oil economic activities that
even increasing oil revenue after the low rate of 1986 were not
sufficient to initiate or sustain a GDP recovering. Some structural
aspect of the economy reveal the failure of Nigerian oil revenues to
provide the impetus for growth in other sector and describe the basis
for what has been essentially uneasy manage between energy and economic
growth in the country per capital income has declined for about $1,000
(in current dollars) in 1980 to about $240 in 1991. The evolution in the
structure of production shows that the share of agriculture in GDP has
decline to 37 percent in 1997 and 41 percent in 1986, despite the
introduction of the structural adjustment programme (SAP) which
emphasized the need to re-establish agriculture as a growth sector.
The share of industry (Manufacturing plus mining) however increased
from 29 percent in 1986 to 28 percent in 1991 but more importantly,
there has been almost no change in the share of manufacturing (around
7-8percent) over the past ten years, oil revenues it is clear that it
has not succeed in the strengthening either the manufacturing or the
agricultural base on the economy. Furthermore, the oil boom year and
massive government expenditure or what was primarily infrastructure and
other non-tradable did not prepare the economy for the oil production
cutback of the early 1980s and the price shock to 1986.
The external debt has consequently increased from a manageable $20
billion in 1980 to about $30billion in 1992. The servicing of the debt
is as the economy as a whole, highly dependent on oil revenues while the
oil industry invariably received much from successive Nigerian
government and foreign oil companies received the necessary inventories
5o ensure that their continued presence, the story of oil in Nigeria is
one of the missed opportunity administrative disorganization, increase
in public expenditure, increasing dependence on oil revenue economy.
1.2 STATEMENT OF PROBLEM
As the leading sector of the economy, the oil industry
should have some positive spill over into the other sectors of the
economy such as technological transfer forward and backward linkage.
The fast growing population rather acquired a taste for a
high quality of life and social well being was emphasized at the rest of
the economy. This oil industry is virtually an enclave which is
integrated more with the economies of Europe, America and France than
Nigeria. The Nigerian economy has become dependent on oil revenues over
the past decades. During the 1986-92 periods, oil export revenues
increased at an average of 13 percent per annum which GDP measure in
current US Dollars, decreased by an average in oil export revenues
increased at an average in oil export revenues along side that
continuing decline of the non-oil economy implies higher dependency.
Over the years, the contributions of the oil industry to the
growth of Nigeria economy are great. On this premise, the researchers
want to appraise the impact of oil industry on the economic development
of Nigeria. Using SPDC as a case study.
1.3 PURPOSE OF THE STUDY
The major objective of the study is to determine the impact of oil
industry in the development of Nigeria. The objectives include;
1. To identify precisely the contribution of shell in Nigeria economic development.
2. To identify the effect of oil revenue on the sector of the economy.
3. To point out the negative roles of shell and the oil industry.
1.4 SIGNIFICANCE OF THE STUDY
Nigeria oil industry has an interesting element in common
with the country’s once celebrates palm oil industry. In view of this,
the importance of the first place shows that Nigeria hitherto was an
agricultural producing economy. Oil industry in Nigeria today is one of
the leading sectors of the economy. It has risen to a position of
prominence and has become the pivot of the Nigerian economy since its
inception in 1859’s.
1.5 RESEARCH QUESTIONS
The researchers have the following question in mind while carrying out his/her research work.
i. How effective is the activities of the oil industry in the economic development of Nigeria?
ii. What are the major problems limiting the efficiency and
productivity of the oil industry with regards to the economic
development in the Nigeria oil industry?
iii.What possible measures and strategies could be employs, to
enhance the efficiency and productivity of the oil industry for economic
development of Nigeria?
1.6 SCOPE/DELIMITATION OF THE STUDY
The research project will be restricted to shell company in
order to examine the impact of oil industry on the economic development
of Nigeria, we have to limit the scope of the study.
The sector in the economy which are influenced by oil revenues will from an integral part of the scope.
1.7 LIMITATION OF THE STUDY
The researcher faced a number of limitations in the course
of carrying out this study. The greater identifiable constraints were
time, finance or cost and literature materials.
Time factors: Time was the major constraint on the
part of the researcher, the researcher had other courses to take
alongside seminar and term papers.
Finance: The problem of finance cannot be over emphasized. In this work, the cost of obtaining materials, transportation to SHELL PETROLEUM DEVELOPMENT COMPANY (SPDC) at
port-Harcourt, Photostatting the materials, buying stationeries, typing
and binding increased the financial constraint of the study.
Literature materials: The relative scarcity of
material and the reluctant of the oil companies especially shell to part
with information related to the oil industry also contributed to the
constraints encountered by the researchers.
Despite this limitation, efforts has been made to provide a reasonable work.
1.8 DEFINITION OF TERMS
The researcher defines the following terms to help for easy understanding of the study. Thus:
Revenue: The Money that is received by government from taxes or that an organization etc receives from business.
Economy: The relationship between production trade and the supply of many in a particular country or region.
Expenditure: An amount of money that is spent on the essence of something.
Mainstay: A person or thing that is most important part of something and enables it to exist or be successful.
Industry: The collection of
individual firm to produce similar commodities or the production of
goods from raw materials especially in factories.
Oil: Thick liquid that is found in rock under the ground.
Barrels: A large round container usually made of wood or metal with flat ends usually covered sides.
Per capital: For each person.