ABSTRACT
SNG was incorporated in March 1998 to promote gas utilization in Nigerian industries and the company has committed over US $33 million to building a gas distribution infrastructure in the heavy industrial areas of Eastern and Western Nigeria (NNPC, 2002). SNOP was incorporated in the last quarter of 2000 to take advantage of the growing local market for petroleum products and government progressive liberalization of the downstream sector. Thus, it is aimed at producing and marketing by-products of refineries including kerosene, insecticides, motor oil and aviation fuel. NLNG, the largest gas plant in Africa, is a joint venture involving NNPC (49 per cent), Shell (25.6 per cent), TotalFinaElf (15 per cent) and Agip (10.4 per cent). Shell is the operator and technical adviser of the joint venture. The $3.8 billon plant began operations in late 1999, exporting liquefied natural gas to markets in Europe and the US. The plant is currently being expanded to double its capacity. Shell’s investment expansions of over the past decade seem rather surprising given the spiral of local protests the company faces in the Niger Delta area, as well as the general instability of the Nigerian political and economic climates. Commenting on why Shell embarked on these expansion projects, a senior industrial relations officer with SPDC explained that the ‘so-called business expansions are more about the company seizing available opportunities.’ According to the respondent:
SNEPCO is a response to new opportunities in offshore production and gas development and offshore businesses do not face much community problems and security risks as the onshore. SNG and NLNG have also been necessitated by opportunities in gas development. Shell produces much associated gas and now there are a lot of local and external markets for gas. SNOP is about the evolving opportunities in bye products marketing – kerosene, insecticide, motor oil, aviation fuel, etc.3
