CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF STUDY
The search for oil deposit started in Nigeria, in 1908 by the Nigerian Bitumen Corporation but was interrupted by the outbreak of the first world war in 1914. Exploration again resumed in 1937 and the first well was drilled by Shell D’Arcy in 1938. Also their activities were interrupted by the Second World War in 1939 but resumed in 1947. In 1955, Mobil Exploration Incorporated received concession over the former Northern region of Nigeria, where the company carried out relevant geological surveys and also drilled some wells in the Western part of Nigeria. But before abandoning its concession in 1961, other Companies such as Gulf, Agip, Safrap (now Elf), Teneco and Amoseas (Now Texaco and Chevron) had also began exploration activities for oil in the on-shore and off-shore areas of Nigeria. Although Shell discovered oil in commercial quantities in Nigeria in 1956, at Oloibiri in the Niger Delta region and began production of the commodity in 1958, the “concessionary rights” which had formally been granted to Shell alone was extended to the new oil companies, in time with the government’s policy of increasing the place of exploration in the country. Apart from the initial discovery of oil at Oloibiri, further oil discoveries at Afam and Bomu, confirmed Nigeria’s status as a major oil producing nation, (WRI, 1990). Hence Nigeria joined the organization of “Petroleum Exporting countries (OPEC)” in 1970 and later established the Nigerian National Petroleum Corporation (NNPC) in 1971; a Federal Government owned controlled parastatal that operates a joint venture (JV) agreement with trace in other foreign multi-national Oil Companies in Nigeria to produce both the nation’s oil and gas. These oil industries have risen to the commanding heights of the Nigerian economy, particularly in the past five decades because it has brought unprecedented changes when it replaced agriculture as the cornerstone of the nation’s economy. Although Nigeria can be categorized as a country that is primarily rural which depends on petroleum production export, surrounding communities within which oil wells are exploited still suffer environmental degradation (Adenorti, 1996).
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