The extractive sector in Nigeria remains the highest source of foreign exchange for its economy. The sector however has been plagued with opacity, corruption and inadequacies in its financial processes. Over the years, Audit Reports of the Nigerian Extractive Industries Transparency Initiative (NEITI) has highlighted these inadequacies and proffered recommendations to help ameliorate these lapses. The focus of this paper however is on the involvement of women and youth in the extractive sector for inclusive participation and sustainable development as a recommendation to help imbibe transparency and sustainability in this sector.

The year 2015 marked a defining moment for the global development effort with the adoption of the Sustainable Development Goals (SDGs) in September, 2015. While countries in Eastern and Southern Africa have made progress against the Millennium Development Goals (MSGs), gaps remain and several issues that were not part of the MDG framework was taken up by the SDGs, such as urbanization, resilience, inequality and governance.

The extractive industries remain a male-dominated industry as compared to the other industries in Africa. It is important to involve women in it because women have the same “right to development” as men, so if extractive industries diminish their access to economic and social development, this human right has been violated. Since women are also often the cornerstones of most Nigerian communities especially in the Niger-Delta region, with key roles in ensuring the health, nutrition, education and security of those around them, investing in women and assuring their participation is not only key for their own development, but also for the socioeconomic development of their families and communities.

A deliberate effort by Nigerians to emulate good practices from other climes in the world on gender and the extractive industries will therefore help guide governments, the private sector, civil society organizations and other stakeholders in developing policy, programmes and legislation that will do a better job of addressing challenges facing women affected by—and hoping to benefit from—the extractive industries sector.

Unfortunately, women entrepreneurs’ participation in the extractive industries meets obstacles and is often influenced by negative perceptions, attitudes, and discrimination related to gender stereotypes. In some countries, these stereotypes stray into downright superstition. For example, some communities believe that having women present at mine sites has a negative impact on productivity, by causing explosions in the mine or driving veins of ore deeper into the earth (Efitime, Heller and Strongman 2009). Women also face more tangible obstacles in buying land, opening bank accounts or obtaining loans. In some cases where they have been able to receive loans, they are subject to unfavorable terms, including high interest rates and short repayment periods (Kelly and others 2013). All of these obstacles result in fewer women working in the extractive industries, running their own companies or scaling up their business to create jobs (Michelitsch 2014).

In contrast, women in developing countries, tend to be overrepresented in the informal sector and in self-employment where jobs are lower-paying and less secure (United Nations 2007). If the jobs created in extractive industries are not inclusive, it could result in risks to social stability, inclusive growth and even conflicts. Sustainable job creation, in my view, could contribute to meeting social goals such as creating more equal opportunities for women and youth.

On the issue of women and youth involvement in projects in the host communities (Communities where oil exploration and mining are taking place), Professor Glynn Cochrane, who established Rio Tinto’s community relations system in 1995, has commented that ‘in order to help the poor, it is necessary to know what they want and the extent to which they can help themselves with their own knowledge and social capital’ (Cochrane 2009: 12). He noted further that offering poor people pre-designed projects and programmes to alleviate their poverty ‘overlook[s] the fact that poor people have ideas, knowledge, and aspirations; that they wish to be treated with respect and as potential partners in any plans for them’ (Cochrane 2009: 3), as he had observed in several decades of involvement in mining sector community development programmes. If they are to succeed in the long term, projects need to be chosen, designed, managed, and implemented by the beneficiaries themselves, with all necessary support from partners and donors.

Evidently, despite the many years of oil exploration in the Niger Delta, the region still suffers infrastructural and socio-economic development and this could call to question the use of the funds generated and ploughed back into the society by the International Oil Companies (IOCs) and other indigenous oil companies through various forms like Signature bonuses, Royalties, Corporate Social Responsibilities, 13% derivatives etc.

Of course, if people neighbouring an extractives project are poor and have little infrastructure available, then it may seem easy to see what they apparently need—schools, roads, clinics, economic opportunities, etc. but that is not the point. The point is that, in order for them to become economically empowered and self-motivated about their future development, they need to be enabled to plan and chart their own destiny, with the help and support of companies and other development agents. There are numerous examples demonstrating that what people assess as their own needs may be quite different from what ‘experts’ say they need. This results in the failure of projects, which rarely receive community support once any initial grants, funds, or gifts from the project promoters are finished. The way to promote the sustainability of social investments is to empower people by giving them the choice of what projects they want to pursue, and the dignity and autonomy to make their own decisions. This is the essence of participation.

Participatory planning, in which community groups determine their own development priorities and design their own community development projects, is an approach to social investment that is more likely to lead to sustainable, community-supported initiatives than projects designed by external experts. Extractive companies can work with their host communities to facilitate the participatory planning process, if needed, and should then cooperate with communities and local governments to work out the intersections between the varying priorities of the different stakeholder groups. The areas where the interests overlap will be the most fruitful ones for development cooperation. Some national governments, such as Tanzania’s, have their own participatory planning processes in place (O&OD), so companies can work with local government and communities to discover areas of mutual interest for social and economic investment.

In all of these, the participation of women and youth of the host communities should be a critical factor to be considered as their participation will greatly benefit the communities and ensure sustainability of such projects.

The vibrant youth population of Nigeria (women inclusive) should not be ignored but encouraged to participate at all levels of the extractive sector. Where knowledge is lacking, deliberate efforts to build the capacity of the youth need to be made by all levels of government, CSOs, IOCs, NGOs and development partners. The involvement of women and youth in all extractive processes including exploration, policy making, monitoring and evaluation and community development projects will not only ensure inclusiveness but will also promote sustainability and ownership which will in the long run lead to more transparency and accountability in the sector.

Nigeria has made steady progress with the implementation of the Extractive Industries Transparency Initiative (EITI) since inception in 2004. NEITI (Nigeria extractive Transparency Initiative) through a legislator in 2004 was established in Nigeria but was backed up by the NEITI act 2007. Since the inception of NEITI in Nigeria, NEITI has produced several reports in the oil and gas sector, solid minerals and Fiscal Allocations and Statutory Disbursement (FASD) Audit report.  For 16 years NEITI has audited the three different sectors by producing 7 oil and gas reports, 4 reports on solid minerals and 1 FASD report. Unfortunately, the impact of the initiative in terms of delivering the core objectives of improving transparency and overall governance of the extractives sector is still generally low not for lack of effort but the stakeholder unwillingness  to reform. This is because most of the remedial issues raised in all the reports have not really been implemented. NEITI reports should by now move beyond merely publishing reports to show evidence of more positive impact and results in the extractive sector.

A major concern is that the numerous governance process and operational gaps recorded in all the NEITI audit reports so far produced are yet to be addressed neither have the government shown considerable interest in addressing them. However, there are some government policies and initiative in NEITI reports.  The NNPC   still have some outstanding payment yet to be remitted to the federal government. Remediation is the process of implementing recommendations contained in the reports towards addressing the identified gaps and improving overall sector performance. Some of the recurring issues in the NEITI oil and gas report include:

  1. Weak arrangements around the domestic crude oil allocation.
  2. Opaque and discretionary license and lease award processes.
  3. Weak arrangements for monitoring and measuring crude and liquids, from well-heads to terminals.
  4. Year 2000 Memorandum of Understanding (MOU)-fiscal terms- between NNPC and Joint Venture Companies.
  5. Petroleum Profit Tax (PPT) underassessment and issues with other taxes and income.
  6. Loss of gas income for the Federation and Production Sharing Contract (PSC) Gas Agreement.

Also the covered entities should address some of the lingering remedial issues covered in the NEITI audit Reports. Some of these covered entities include ;NNPC,     DEPARTMENT OF PETROLEUM RESOURCES,   NIGERIAN ASSOCIATION OF PETROLEUM EXPLORATIONS, SNEPCO and NIGERIAN AGIP ,  OANDO, NECOND,  TOTAL/MOBIL/SPDC, SHELL PLATFORM PETROLEUM,ORIENTAL ENERGY,   PILLAR OIL,  NIMASA,   FEDERAL INLAND REVENUE SERVICE (FIRS)  ,  CENTRAL BANK OF NIGERIA (CBN)

It is important the NEITI Act is reviewed to give it power to reprimand the covered entities that have refused to implement the NEITI audit reports, findings and remedial issues. NEITI should also expand her relationship with the different stakeholders that have influence like EFCC and ICPC to ensure that the under declaration, underpayment and other sharp practices have enforceable penalties attached to them.

The implementation of the NEITI remediation and audit reports cannot be fully implemented without the different stakeholders on the demand side showing an effective advocacy for the implementation of the reports. The CSO members that work in the extractive sector should take the lead in pushing the government to show more will and determination in ensuring comprehensive reform in the extractive sector of Nigeria. In addition, NEITI should work comprehensively with the civil society organisations to ensure buy in and partnership towards ensuring the implementation of the EITI standards.

In order to address the remediation of the audit findings, the Federal Government first set up the Inter-ministerial Task Team (IMTT) in 2006. After 7 years with only minimal progress at remediation recorded, the government reconstituted the IMTT in late 2013.  The Inter-ministerial Task team (IMTT) should be made to have only officers with the authority to make input and take the decision in the institutions they represent. Hence, there is the need for other stakeholders, especially civil society, to support the IMTT to effectively execute the remediation of NEITI audit findings.  Civil society participation in all the aspects of EITI implementation is essential not only for the fulfilment of the necessary requirements but also because it could ensure that the right amount of pressure needed to influence reform is generated.

For effective reform in the extractive sector, the different covered entities and institutions should show a determination to improve on the process and also implement the recommendations of the NEITI audit reports. They should see NEITI and other institutions as partners whose sole aim is to improve the governance architecture. Institutions like NNPC, DPR, Ministry of Petroleum Resources and other covered entities should make the remedial issues as urgent towards ensuring a strong and corruption free extractive sector.

The reoccurrence of some of the issues in the NEITI audit reports should be discouraged and appropriate administrative sanction should be implemented against agencies and MDAs that have refused to implement the audit and remedial issues.

It is encouraging that some of the recent reforms in the sector have inputs from the findings and activities of NEITI. We have an instrument that if well managed and utilised, will go a long way in making the extractive sector the dream of all well meaning Nigerians.

Ogwu Paul Okwuchukwu

PWYP, Nigeria.