Inter-Partner Learning in Asymmetric Alliances between Foreign and Indigenous Companies in the Nigerian Oil Industry
Part I: Introductory Section 1
. Introduction 1.1 Background The Nigerian oil and gas industry has been the single most important sector of the Nigerian economy, accounting for over 90 percent of Nigeria’s foreign ex- change earnings and about 85 percent of the collectible revenue of the Nigerian government. The role and significance of the industry to the Nigerian nation has been widely acknowledged and reported in the literature (e.g. Madujibeya, 1976; Frynas, 2000; Okubote, 2001; Heum et al, 2003; Nordas et al, 2003; Oko- jie/Oaikhenan, 2005; Amadi et al, 2006; Thisday, 2009; Ariweriokuma, 2009). However, since the inception of the industry in 1956, when oil was discovered in commercial quantity in Nigeria, the industry has been dominated by multina- tional oil companies, which carried out most of the oil exploration and produc- tion (E&P) activities in conjunction with their foreign oilfield services contrac- tors and subcontractors. Even downstream activities such as distribution and re- tailing of petroleum products were until recently dominated by the subsidiaries of multinational oil companies. Although the Nigerian government started tak- ing active participation in the industry since the beginning of the 1970s through the acquisition of equity interests in the operations of the multinational oil com- panies in the form of joint ventures (JVs), the multinational oil companies as the operators of these joint ventures still dominated oil exploration and production activities, accounting for over 95 percent of the crude oil production in the in- dustry, while the foreign oilfield services contractors dominated the oilfield ser- vices sector (cf....
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