BEING A
DISSERTATION IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF MASTER
OF LAWS (LLM) DEGREE
SCHOOL OF
POSTGRADUATE STUDIES
DEPARTMENT
OF PUBLIC AND PRIVATE LAW
LAW, FACULTY
OF LAW
CHAPTER ONE
GENERAL INTRODUCTION
1:1
Background
of the Study
Nigeria is Africa’s leading oil producing country and
the world’s sixth producer with a production capacity of about 2-million barrels
per day. Its oil reserves are
concentrated in the Niger Delta region of the country. Petroleum from this region “account for over
80% of GDP, 95% of National Budget and 90% of foreign exchange earning”.[1] Before
the discovery and exploitation of oil, Nigeria had an agrarian economy, but the
above figures show that oil has grown to become an “indispensable” part of the
Nigerian economy.
As is obtained in other
oil-producing countries (oil exploitation) in Nigeria is regulated by some
enacted legislations. The most important
oil-related legislations in Nigeria include; The Petroleum Act 1969 (now cap10
LFN 2004), Oil Pipelines Act 1956 (now cap. 07 LFN 2004), Oil in Navigable
Waters Act 1988 (now cap 06 LFN 2004), Federal Environmental Protection Agency
1988, and the Land Use Act 1978 (now cap. L5 LFN 2004). By the Petroleum Act (continuing a colonial
policy) the entire property in petroleum (mineral oils) is vested in the
state. The result is that the Federal
Government has absolute right and control over oil resources in the country,
which is found in the Niger Delta region of the country. It farms out oil-mining rights to oil companies
and receives rents and royalties from them in return. As has been seen above, oil has realized so
much money for the Nigerian state over the years.[2]
Under the common law, the principle of quic quid plantatur solo, solo cedit (whatever is attached to the land is part of the land) applied in relation to land. However, this is not the case with Nigeria. Our section 16 of the Interpretation Act 1964 (now cap 191 LFN 2004), explicitly gives us another meaning of land.[3] Under this regime, while oil is vested in the state, ownership of land supporting oil remained with the individual or family owners of the land until 1978 when the Land Use Act (hereinafter referred to as the LUA) was made. The Act vests all lands in any state of the Federation in the Governor of such State.[4] It is pertinent to note that before the promulgation of the LUA, oil companies that had obtained licences from the federal government approached oil-bearing/land – owning communities for a right of access to the land for oil operation. That was the way by which the communities had some sense of participation in oil operations, as they received some money for granting access and for any damage to land and surface rights. It is now clear that controls exercised hitherto by communities with oil deposits have been lost since the Land Use Act 1978 unified land ownership rights to oil deposit.[5]
The problem we see here is that,
while the Federal Government owns the petroleum resources, the littoral State,
personified in its Governor owns the land supporting the petroleum resources.[6] The
littoral States have been demanding a higher percentage of proceeds from the
resources extracted from their region.
The region claims that 13% of the oil revenue allocated to the states,
by the 1999 constitution[7] is a
slap on the face, and want as much as 50%.[8] Many
juristic pens have flown in a bid to unravel the puzzle envisaged here.
Yinka Omoroegbe[9]
suggested that protection of communities should be in the form of law that give
adequate protection of proceeds from sale of the natural resources to the
affected communities and ensuring that they are not left out of the development
process. Ike Oguine[10]
expressed a similar view.
Former Governor of Delta State,
James Ibori at the inaugural meeting of the Governors and members of the
National Assembly from the south-south zone at Asaba on Friday 31st
March 2000, had this to say, “…any law in our statute books which directly
frustrates the realization of our dreams through a calculated scheme of expropriation
of our natural resources should be seen as repressive and should be expunged.”
Secondly, there is the problem of
the state of the environment, Oil companies having no respect for the
environment and that has threatened the survival of the oil producing
communities. The constitution of Federal
Republic of Nigeria in section 33 (1) upholds the right to life. This entails also a right to breathe, by implication
pure air, which is part of the constitutional right to life. Chief Eglare W.O. Ojihogar, Chief of Ugborodo
community in Delta State, in an interview with Amnesty international had this
to say,
It is like paradise and hell. They have everything. We have nothing… if we protest, they send
soldiers.[11]
Over
50 years of exploration and production, oil companies have left large parts of
the Niger Delta uncultivable, due to frequent oil spills, leakages and the
effect of gas flaring or other accidents.
Societies disintegrate within the measures more frequently than they are
broken up from external pressure. There
is disintegration when no common morality is observed, and history shows that
the loosening of moral bonds is often the first stage of disintegration.[12]
Over the years, militant groups have
claimed to stand up for the inhabitants of the Niger Delta residents Adaka
Boro, died while fighting for a people friendly environment for oil operation. Ken Saro-Wiwa, equally suffered the same fate
while fighting for the same course.
Alhaji Asari Dokubo led the Niger Delta Peoples’ Volunteer force (NDPVF)
calling for secession of the region from Nigeria since 25 September, 2004,
until he was arrested and charged with treason on October 6th
2004. In 2006, a new militant group
emerged from the region known as the movement for the Emancipation of the Niger
Delta (MEND), since then militancy and hostage, taking has become a notorious
phenomenon with the Nigeria polity.
Thirdly, is the issue of
compensation for land and improvement on it S.36 of schedule 1 to the Petroleum
Act 1969 provide for the payment of “fair”
and “adequate” compensation, which refer to surface right including and to
specified plants. It should be noted
that outside crops and economic trees, oil pollution and activities of oil
companies can and do affect fish ponds, farms, canal, water ways, wilding,
roads, buildings, and equally the problem of desecrating of shrines, cemeteries
and cultural and ancestral lands.[13]
To solve this problem, C.A. Omaka is
of the view that the Petroleum Act 1969 should be reviewed so as to define the
term ‘fair’ and ‘adequate.’[14] This is
in consonance with the position of Yinka Omoregbe.[15] Angaye[16] has
called for the return of land to its original owners (the people). He states:
When the rightful owners of oil become partners with
oil companies and government, then justice is done, and peace and progress will
reign supreme in the Niger Delta Region in particular, and Nigeria in general.
Fourthly,
is the issue of conflict between the oil communities and State. The Federal Government, by the Petroleum Act
acquired ownership of petroleum leaving the surface rights to the former owners
of the land. The arrangement, the
communities were not comfortable with.
However, things fell apart irretrievably, upon the introduction of the
Land Use Act, which vested land in the state thereby removing the communities’
surface rights, with the following implications in the communities’ interest:
1. Revocation of people’s right to their land
2. Deprivation of owner’s choice as to who acquires his
or her land.
3. Denying an owner of land a choice of due compensation
for the acquisition.
4. Owners living under a perpetual likelihood of losing
their land to government
5. Owners’ inability to decide activities that should be
carried out on his property or neighbourhood.
6. The Governor may well acquire any resource
rich land for any “public purpose”.[17]
To solve this problem, Kaniye S.A. Ebeku[18] has
called for a repeal of the Land Use Act without delay. This view is in line with the position of James
Ibori noted above. Omaka calls for the review of the Petroleum Act and
the Land Use Act[19]
a view shared by Anaye.
From the
above review of the positions of eminent scholars work on oil ownership crisis
in Nigeria, one can discover that they concentrated on the UN Resolution 1803
of environmental impact of oil exploitation despite the huge revenue oil
exploitation has yielded to the Nigeria State.
There has not been any write up on the impact of the ownership of
petroleum in Nigeria by the state (the federal government) on the Land Use
right of the citizen, who before the enactment of the Land Use Act 1978, were
the owners. Where the federal government own mineral resources, the state
government owns the land, what is the position of the people who are at the end
point of every political move in the society?
Again must
the strive between the state government and the Federal government last
forever? Must the Niger Delta peoples abandon their ancestral homes, because of
the nature’s gift of oil?
These are
the lacunae that this dissertation aims at addressing.
1:2 Statement
of the Problem
All
lands and natural resources (including mineral resources) within the Ijaw
territory belong to the Ijaw community and are the basis of our survival… We
cease to recognize all undemocratic decrees that rob us of our lives and
resources, which are enacted without our participation and consent. These include the Land Use Decree and the
Petroleum Decree... (Kaiama Declaration, 11 December, 1998).
Against the backdrop of the scenario creation in 1:1
above, we wish to state the consequences of the situation on the Nigerian
polity and the Niger Delta in particular.
The crisis over ownership of oil and
gas in Nigeria has been of tripodal
imperative, which has been between local communities and the government;
local communities and oil corporations on the other and between Federal and
State Government. Jurists have debated the reasons behind these crises. We will discuss these conflicts distinctively
and analyse the writing and opinions of some great jurists on this area of our
jurisprudence.
The Federal-State conflict that is
branded “resource control” calls for fair, just, equitable and manageable
natural resources sharing policy that shall be favourable to all Nigeria stake
holder. Resource control is legal
incidence of ownership of natural resources. The basic principle of our
property law is that he who owns a thing of value manages it. In the words of Niki Tobi, JCA (As he then
was), in Abraham v. Olorunfumi[20]a,
the distinguished jurist observed
thus: “In so far as the property is his and inheres in him, nobody can say
anything. He is the alpha and omega of the property. The property begins with him and also ends
with him”.
According to Professor Utuama20
subject to administrative and legal qualifications which may vary in content
from jurisdiction to jurisdiction, it is trite law that the owner of a thing
manages and controls it. Thus, the
demand for resource control simply implies the wish of the governments and
people of the Niger Delta region to exercise the legal right to control,
manage, use, enjoy and abuse the natural resources located in the Niger-Delta
region. Is this demand legitimate? It is my strong view that the legitimacy of
the demand can hardly be faulted in a democracy founded on the rule of law.
In common law parlance, land
endowments in terms of natural resources in or under Land belong to its’
owner. This is explained by the maxim quic quid plantatur solo, solo cedit
earlier referred to which has been judicially recognized as an established
principle of our Land law by the supreme court, the Apex court in our land, in
the celebrated judgement in the case of Otogbolu
v. Okeluwa.[21] It simply means that what is attached to land
is part of the land and belongs to the owner.
As such, the owner has the amplitude of rights vested in him to enjoy it
as he pleases, limited by the right of his adjoining neighbour to the
reasonable enjoyment of his land.
When one considers the above
principle in the light of the land ownership pattern in Nigeria, one would be
left with the option of asking, who actually owns the land in Nigeria? This is because, the constitution[22] and
the Petroleum Act[23], has
vested ownership and control of all mineral resources in the Federal
Government, the Land Use Act[24] vests
ownership of Land in the State Government, while it equally allowed the
individual to use the land.
In a bid to solve this problem, Utuama[25] is of
the view that all the natural resources in the Niger Delta region should
rightly belong to its government and people. This his view firstly, stems from
the principle of quic quid plantatur
solo, solo cedit stated above, which he examined in the light of section 1
of Land Use Act 1978 that vests Land in the State Government. Secondly, on the principle of true
federalism, where he posited;
A fundamental principle of federalism is that the
governments of the federal union are allowed to take their destiny into their
hands in the management of their respective administrative autonomy and natural
resources with an agreed sovereign competence ceded to the federation for their
mutual beneficial purpose[26]
On
the side of Anagaye[27], he
posited thus;
The Logic that one owns the land and another owns the
oil extracted from beneath the land is Nigerian Logic or illogic propounded by
parochial logicians. If crude oil were
found under “the big three” eminent jurists would have inserted the enabling
section in the 1999 constitution to read: “Any oil found under any big three belongs
exclusively to the owner of a big three.
Another puzzle that will trick the
mind of any close observer of this area of our jurisprudence, is the question
of the position or place of the individual/community user of land, since the
land to the State Government, and the resources beneath the land belong to the
Federal Government herein after referred to FG (this question will always come
to mind whenever the FG is to exercise this power of exploitation).
In a bid to address this, Nsongurua
J. Udombana[28]
said that these laws have been weighed and found wanting since they have failed
to meet the human security of Nigerian, and without security, food, shelter and
clothing-there can be no freedom.
Necessitous men are not free men.
Isaiah Berlin put it well when he said “men who live in conditions where
there is no sufficient food, warmth, shelter and the minimum degree of security
can scarcely, be expected to concern themselves with freedom of contract or of
press.”
This is the problem with the LUA.
With a stroke of the military pen, this “callous
and arm twisting law’28a snatches from individuals, families,
villages and other ethnic nationalities their inalienable right to property and
source of livelihood and turned them into beggars. With bowels in their hands, as all beggars
do, Nigerian now go to the government or the appropriate officer to obtain
crumbs of lands for housing, agricultural or other developmental purposes. That is not just a pity; it is dangerous.[29]
The real problem appears once; the
F.G through the oil companies discovers petroleum in side the “crumbs” of land granted
to the individual/community or village by the Governor. Prior to 1978 where
land was not compulsorily acquired by the government and oil company had to
negotiate with community land owners for access to land for oil operations, it
settled the amount of compensation (annual rent) it had to pay to the community
for the use of the land in its intrinsic nature (oil operation may result to a
total loss of use of the affected portion of land by the land owners).
Additionally, the oil company had to pay compensation for any damage to surface
rights (e.g. farm crops, or building).
In this case, compensation must be fair and adequate and its payment is
inconsistent with fairness and justice.[30]
Since the enactment of the Land Use
Act, acquisition of Land is now done within the compass of the Act. The Act provides for the revocation of a
right of occupancy by the Governor of a state for “overriding public interest”
in that it is required for mining purposes or oil pipelines or for any purpose
connected therewith. When this is done,
the law provided for payment of compensation to the holder and occupier under
the appropriate provisions of the minerals Act or the Petroleum Act or any
legislation replacing same. Petroleum
Act and Mineral Act provides for fair and adequate compensation to “owner or
occupier” of private land for any disturbance of the surface rights of such
owner or occupier. Section 29(3) LUA
gives discretion to the governor of a state to decide who receives the money
(and possible how it may be utilized).[31]
It would be recalled that under the
prevailing customary land tenure system before 1978, any such compensation
would be paid to the traditional authority of the community concerned for the
benefit of the community. But by the
combined effects of S. 1 and S. 29 (3)
of LUA, the Governor of a state is the new owner of all the land comprised
in the territory of the state. As could be observed, the provision speaks of
holder and not owner. The result is that, like oil rights, land rights are now
vested in the state. Available evidence
indicates that compensation for lands compulsorily acquired under the Act, are
now paid to the Governor of the state concerned and not to the community
headman as before. State government now
feel that communities are no longer entitled to compensation, as of right since
they no longer own any land.
Therefore, as to the right of the
communities when the FG exercises its right of expropriation of oil, Ebeku.[32] is of
the view that, the people have no right at all to both the land and natural
resources found in their communities. He
states that they are merely at the mercy of the governor (the owner of land) to
determine the compensation, value if even that will accrue to the occupiers of
his land. Therefore, he called for the
immediate repeal of the LUA. N.J.
Udombana[33]
is of the view that these modes of ownership s work against the human rights of
the people, and the various statutes involved have been weighted in the
balances and found wanting.[34]
From the above review of the
positions of eminent scholars’ works on these issues raised above, one can
discover that they concentrate on 1962 UN Resolution 1803 on state sovereignty
over her natural resources and environmental impact of oil exploitation on the
people. There is no known work that
seeks to address the problem of ownership of Land and natural resources between
the federal government and the state government in the light of the principle
of quic quid plantatur solo, solo cedit (that
is from private law domain). Secondly, is the problem of the position or right
of the individual occupier of land when the F.G. claims the right to natural
resources and the state to land.
These are the lacunae, which this
dissertation aims at addressing in the most conceptual manner.
1:3
Research Questions
1. Considering the ownership position of Land in Nigeria
and the principle of quic quid plantatur
solo, solo cedit, who is actually the owner of land for the application of
this principle?
2. If the state government is the owner of land, what is
the legal position of the holders of the infrastructural interest having regard
to the fact that the federal government can move to expropriate mineral resources
in those land.
1.4 Objectives
of Study
The dissertation is aimed at considering the legal
regime of ownership of petroleum and Land Use in Nigeria. The choice of this
topic stems from the fact the though the course is a viable one, and many
scholars have written on this concept, but have concentrated on 1962 UN
Resolution 1803 on state sovereignty over her natural resources and the
environment impact of oil exploitation.
However, some lacunae have been discovered. Accordingly, our objectives
in this work will be
1. To examine the legal framework of ownership of
petroleum in Nigeria and define some technical terms
2. To assess the adequacy of the existing provisions
3. To highlight defects and shortcomings in the existing
provision.
4. To proffer solution to the resource control problem in
Nigeria
5. To re-examine the rights of the oil producing
communities in Nigeria
6. To ensure that suggestions are made geared towards
ensuring that further improvement can be made to enhance the country’s
ownership right over her mineral resources.
7. To reposition the role of the judiciary in settling
oil dispute.
1.5 Research Methodology
We conceive this work as a technical one; therefore
our methodological approach will be primarily analytical. Therefore, we will resort to the analysis of statutory
enactments that are petroleum and land related.
However, we will not in the process lose sight of the non-legal factors
that have influenced ownership of petroleum resources in Nigeria.
Furthermore, a comparative analysis
of the various statutes that are petroleum and related will be done. Therefore, I intend to visit the library and
Internet source to consult works of scholars in this area.
1.6 Relevance of the Study
Although many scholars have written on the concept of
ownership of petroleum in Nigeria, it is important to note that they have
concentrated on 1962 UN Resolution 1803 on state sovereignty over her natural
resources and the environmental impact of oil exploitation in Nigeria. The research exercise is relevant to the extent
that one should be able;
1. To know the evolution of the statutory regime in the Nigerian
oil industry.
2. To proffer a lasting solution to the resource control
problem in Nigeria.
3. To re-examine the rights of the oil producing
communities vis-Ã -vis the right of ownership of petroleum by the Federal
Government and ownership of land by the State Government.
4. To determine what is ‘adequate’ and ‘fair’
compensation when disasters occur in the oil industry.
5. To assess the various petroleum related enactments,
pointing out their adequacies, shortcomings and making suggestions for way
forward.
1.7 Delimitation or Scope of the Study
The main focus of our consideration is the question of
who owns ‘what’ and gets ‘what’ in the Nigeria petroleum industry. To do this efficiently, using the maxim quic quid plantatur solo, solo cedit,
a critical examination of the various legislations affecting the oil industry
will be done, pointing out their adequacies and inadequacies, not forget the
environmental impact of oil exploitation in Nigeria. Finally, observations, recommendations and
conclusion will be made.
Because this work is aimed at
examining ownership of oil and land use in Nigeria, attention will be paid to
the various contractual interests in oil and gas in Nigeria (i.e. exploration,
exploitation and production).
1.8
Limitations
The challenges that can
pose a threat to this research include the following;
i.
Fund to be able to
assess materials online and equally type the work.
ii.
Collections and
retrieval of documents from archives, libraries and even those of higher
institutions and courts turned out to be huge obstacles.
iii.
The cost of
traveling to obtain these materials limits the movement to some places