CRITICALLY EXAMINES THE LEGAL ISSUES IN THE DEREGULATION OF THE DOWNSTREAM SECTOR OF THE NIGERIA INDUSTRY: CONSIDERING THE ARGUMENTS IN FAVOUR AND AGAINST DEREGULATION INCLUDING ISSUES PERTAINING TO OPERATION OF THE REFINERY ,WITHDRAWAL OF OIL SUBSIDIES AND APPROPRIATE PRICING IN A LIBERALISED ECONOMY. .
Nigeria is blessed with vast quantity of oil making it the 6th largest oil exporter in the organization of petroleum exporting country. Oil is a major source of energy in Nigeria and the world in general. Oil being the mainstay of the Nigerian economy plays a vital role in shaping the economic and political destiny of the country. Although Nigeria’s oil industry was founded at the beginning of the century, it was not until the end of the Nigeria civil war (1967 - 1970) that the oil industry began to play a prominent role in the economic life of the country. Nigeria can be categorized as a country that is primarily rural, which depends on primary product exports (especially oil products). Since the attainment of independence in 1960 it has experienced ethnic, regional and religious tensions, magnified by the significant disparities in economic, educational and environmental development in the south and the north. These could be partly attributed to the major discovery of oil in the country which affects and is affected by economic and social components. Crude oil discovery has had certain impacts on the Nigeria economy both Positively and adversely. Although Nigeria makes billions of dollars but as most developing countries this has not transformed the economy of the country. Due to problems of mismanagement, inefficiency, corruption, lack of funds, smuggling, bureaucratic bottlenecks and excessive subsidizing, the supply of crude oil has excessively collapsed. the importance of oil in any given economy cannot be overemphasized as illustrated or effective captured in the words of Dr. Trevor, Byer while delivering a lecture in the 14th international energy forum and the it goes thus’’ I think a Body like this does not need to be convinced that the energy sector is an important part of the Nigerian economy. it produces about 75% government revenue or more 50% of public investment and it earns more than 95% of the foreign exchange that comes into Nigeria…’’ From the above statement it is made clear and more light is shared on the reason why the importance of the oil and gas sector of the Nigeria economy cannot be overemphasized. for the purpose of our discussion however it would not be out of place to define what oil means in the first place . Oil has been defined as crude petroleum and other hydro carbons regardless of gravity which are produced at the wellhead in liquid forms and the liquid hydro carbons known as distillates or condensates recovered or extracted from gas other than gas produced in association with oil. Oil is a major raw material which has many useful uses hence its importance and place of prominence .among it uses is that it is used as a convenient and effective source of energy .it provides fuel for machineries. it has uses for power generation ,domestic uses ,transportation, it keeps the factories in the industrialized economy working and it’s a source of revenue e.t.c. In the words of Feide in 1986 ’’It is linked with blood, tears and suffering it helps development and progress. it has been sighted as a means of political domination ,economic exploitation and physical domination ”From the foregoing it can be seen that oil has and is still affecting the lives of people all over the world. The destiny of all nations is in fact determined by the results of petroleum industry operation. To begin with, the question can be asked, what do we mean by the oil and gas industry and what are its components. people usually refer to it as one industry but it is not it is made up of many industries each one having acquired its special characteristics...