20 Jan

OIL AND GAS 1.1A INTRODUCTION (DEFINITION)

PETROLEUM: DEFINITION From the Greek word Petra (rock) Elaion (oil) meaning oil from rock. By the interpretation of Section 15 of the Petroleum Act 1969, petroleum is mineral oil or natural gas as it exists in nature. Section 362 of the Petroleum Industry Bill includes condensate, bitumen and mixtures of any of them in its […]

20 Jan

OIL AND GAS 1.1B INTRODUCTION (DIFFERENCE BETWEEN OIL AND GAS)

DIFFERENCES AND SIMILARITIES BETWEEN OIL AND GAS. Oil and gas are similar in the following respects: Both are fossil fuels derived from petroleum (a hydro carbon formed from the decomposition of sea organisms millions of years ago). Both are (non-renewable) forms of energy with varying uses like transportation, heating, power and so on. Both are […]

20 Jan

OIL AND GAS 1.1C INTRODUCTION (USES AND IMPORTANCE OF OIL AND GAS)

USES AND IMPORTANCE OF OIL. Energy: for internal combustion engines and for heating. Liquefied gas for cooking and powering cigarette lighters. Chemicals used in laboratories (for example sulphuric acid). For the manufacturing of pharmaceutical and cosmetic products like Vaseline. Wax used in packaging food. Bitumen for roads. Used for manufacturing plastics. In conclusion, the presence […]

20 Jan

OIL AND GAS 1.1D INTRODUCTION (HISTORY)

HISTORY. The occurrence and discovery of petroleum is no new phenomenon. It has been collected (usually from seepages) and used (for lubrication and waterproofing) in ancient times. It has been produced from bamboo-drilled wells in ancient China. The first oil well is alleged to have been dug in shush Iran about 500BC. The first truly […]

20 Jan

OIL AND GAS 1.2A OWNERSHIP (INTRODUCTION AND PRINCIPLES)

OWNERSHIP OF OIL AND GAS. Ownership has been described by Tobi J.C.A in Abraham V Olorunfunmi as the greatest legal interest in a thing… the power to use, alter, destroy, assign without the consent of another[1]. Because of the economic importance of petroleum, it is important to ascertain who owns the petroleum found in a […]

20 Jan

OIL AND GAS 1.2B OWNERSHIP OF OFFSHORE OIL AND GAS

OWNERSHIP OF OFFSHORE NATURAL RESOURCES. Because petroleum is an accident of nature, it occurs onshore[1] and offshore[2]. Water makes up more than 2/3rd of the Earth. Where petroleum is discovered in the waters or deep seas, the question is; who owns it? International Laws provide answers to this by delimiting the boundaries of states in […]

20 Jan

OIL AND GAS 1.2C OWNERSHIP BY INDIGENOUS COMMUNITIES

DO INDIGENOUS COMMUNITIES (WHERE THE PETROLEUM IS FOUND) HAVE A RIGHT OVER AND ABOVE OTHER NIGERIANS IN RELATION TO THE RESOURCES? Article 26, of the UNDRIP (United Nations’ Declaration on Rights of Indigenous People) mandates states and explorers to respect the rights of indigenous people over their land. Article 78 UNCLOS fights against pollution and […]

20 Jan

OIL AND GAS 1.2D OWNERSHIP; STATE VERSUS FEDERAL

STRUGGLE BETWEEN FEDERAL AND STATE FOR CONTROL OF OFFSHORE RESOURCES. Despite various laws and constitutional provisions declaring federal jurisdiction and ownership over natural resources[1], littoral[2] states within a nation still lay claims to offshore oil. In the US, the following cases have reaffirmed federal jurisdiction over offshore natural resources: Continental Shell Offshore Newfoundland (Canada as […]

20 Jan

OIL AND GAS 1.3 STATE PARTICIPATION (A) CONTRACTUAL ARRANGEMENTS

STATE PARTICIPATION AND CONTRACTUAL ARRANGEMENTS FOR EXPLORATION OF PETROLEUM. State participation entails where a host State[1] gets involved in the exploitation of its natural resources. “State Participation” generally entails an arrangement where the host government has some interest in its oil industry. State participation encourages independence and asserts the sovereignty of a state. State participation […]

20 Jan

OIL AND GAS 1.4 STATE PARTICIPATION (B) CONCESSIONS

NATURE AND TYPES OF CONCESSIONS. Black’s Law Dictionary defines a concession as a government grant for specific privileges… Concessions are contractual agreements between the government through NNPC and oil companies which permit the production, exploration, transportation, and so on of petroleum. Since Section 44(3), Section 1 PA, 1 Minerals Act, 2 PIB and so on […]

20 Jan

OIL AND GAS 1.5 FARM OUR ARRANGEMENTS

FARM-OUT ARRANGEMENTS AND MARGINAL FIELDS. Marginal fields: Where a major oil company has a concession in an oil field which does not contain a significant discovery and the field is neglected for more than 10 years, the minister may (with the requisite approval of the head of state) cause a farm-out of the oil field […]