Industrial Hubs that are evolving in the South-South Geopolitical Zone (1)

The five previous editions of this series revealed so much information about the emerging industrial hubs in the South-East and South-West Geopolitical Zones of the country.

This current edition examines the industrial hubs that are emerging in the South-South Geopolitical Zone.

In the South-South Zone, Rivers State has been the investors’ delight. The weather – adequate rainfall all year round with cool natural habitat – is suitable not only for habitation but also for investment and tourism. With its beach ridge, salt water and fresh water ecosystem, the natural resources that would serve as input to industries are available in large quantities.

At the moment, oil businesses remain dominant in the region. Among these are two large petrochemical and refining companies operating side by side with liquefied natural gas plants, a fertilizer company, and oil service companies. Hundreds of employment have been created, commercial activities intensified, growth and development accelerated; although sufficient linkages between the oil and gas industry and the other sectors have not been very well established, which poses a challenge for the future. This is to say that the current gains of the current oil economy cannot in any way be understated, particularly from the point of view that oil has for a long time remained the main source of national and subnational revenues.

Apart from the crude oil export proceeds, the oil and gas industry existing side by side with several small and medium enterprises has yielded enormous statutory and tax revenues to all states in the South-South or Niger-Delta Region; a development that has indirectly boosted the commercial and hospitality industries and expanded housing and infrastructure.

The rain forest climatic and mangrove swamp vegetation conditions are favourable to the growth of several variants of oil palm trees, raffia palm, shrubs, bananas, cassava, etc., while the lower Niger flood plain is endowed with industrial silt and clay. The agro-industrial sector beckons for mass investment because of availability of raw food crops such as yam, cassava, cocoyam, maize, pineapples, plantain and cash crops such as oil palm products, rubber, raffia palm and fish produced in commercial quantity essentially in Rivers and Bayelsa States. Ironically, fishing thrived and has the potential to continue thriving but for the oil and gas production in that territory which has largely polluted the waters and virtually annihilated fish life in them. For the same reason, the agro-industrial activity has become subdued; although it has the potentials to be reactivated within the visionary context of the ‘zero-oil’ economy being contemplated by both oil and non-oil producing states.

Palm Oil production is indeed an old, local enterprise that is popular among the rural people. There was a time in the nineteen eighties when the state government made ambitious efforts to develop high-yielding upland, dwarf ‘RISONPALM’ trees but this effort was not sustainable following the pursuit of diverse political interests by successive administrations.

Okomu Oil Palm Company Plc is one of the many agro-allied businesses that has flourished in Benin City (Edo State) and environs. Little wonder why the Nigerian Institute for Oil Palm Research (NIFOR) is established in that area. The formal mandate of the institute is to conduct research into the production and products of oil palm and other palms of economic importance and transfer its research findings to farmers.

NIFOR enjoys substantial international standing as a major world centre in oil palm research. The Institute has well established experimental station infrastructure with functional facilities, and a tradition of scholarship and relevant research.  Prior to its establishment, some research on the farming of the crop had been undertaken by the then Colonial Department of Agriculture in Nigeria. Palm oil was indeed among the first commodities of international trade between Nigeria and Europe, after the slave trade. The world trade in palm oil in the early 20th century and up to the Second World War was dominated by countries of British West Africa (largely Nigeria). NIFOR has however, since 1992 come under the aegis of the Federal Ministry of Agriculture. The thrust of work at NIFOR today, as in the past, derives from national goals as currently defined by the national policy on agriculture and the needs of farmers. Efforts are being made to reposition the Institute so that it could provide greater support to prospective investors.

Guinness Nigeria Plc is a beverage and alcohol industry in Nigeria with one of its brewery plants located in Benin City, Edo State. Similarly, Global Horn Industry, a foremost made-in-Nigeria manufacturing company that produces high quality PVC ceiling, is also established in the territory. Other manufacturing industries that have plants in Benin City include: the Nigerian Bottling Company, established in 1970 for the manufacturing and distribution of non-alcoholic beverages such as fanta, coke, sprite, Schweppes, and five-alive; Seven-Up Bottling Company (SBC), Oluku-Benin Plant, which is a manufacturing company that is into the production of soft drinks of different brands such as pepsi, mirinda, teem, mountain dew and lots more; and Bendel Brewery Limited, which is a drink manufacturing company that brews and bottle both beverages such as Lager beer and other brands of international quality standards.

Mouka Limited has a branch office in Benin City for the manufacture and distribution of quality mattresses, pillows and mozzi.

Integrated Rubber Products Nigeria Plc, with headquarters in Benin City is a rubber production company that manufactures natural and synthetic rubber products.

Perhaps, the most current of all the strategic investment in Benin City is the state-owned modular refinery located in Ologbo, Ikpoba–Okha LGA, of Edo State. The refinery was developed by two Chinese firms: AIPCC Energy Limited and Peiyang Chemical Equipment Company Limited. It has a capacity of 6,000 barrels per day and it is expected to produce 50 percent of diesel (500,000 litres), 25 percent of naphtha (300,000 litres) and 20 percent of fuel oil (200,000 litres) from its feedstock (crude), which would be obtained from the Nigerian Petroleum Development Company (NPDC) facility – oil mining lease (OML) 111 – near Benin City.

Duport Refinery is the second modular refinery in the state, following closely behind the 6,000bpd Edo Refinery constructed by AIPCC Energy Limited and Peiyang Chemical Equipment Company Limited. With the capacity to produce 10,000 barrels per day (bpd), Duport Refinery is promoted by Nigerian Content Development and Monitoring Board (NCDMB) and Duport Midstream Company Limited (DMCL) ready for operation in the second half of 2023.

The combined capacity of the two refineries positions Edo State as a major hub for petrochemicals in the country. They will surely create job opportunities and build local capacity in the oil and gas industry. Based on these developments, Edo State is therefore fast-becoming a hub for petrochemical industries, opening the state up for more investment in the oil and gas industry.

Chukwudi Odili