EXPROPRIATION OF RIGHTS IN NIGERIA'S OIL AND GAS SECTOR: BALANCING STATE INTERESTS AND INVESTORS PROTECTIONS

Abstract

To say that the oil and gas sector of the Nigerian economy is the toast of many foreign investors is to state the obvious. It is axiomatic that any investor would strive to satisfy himself that his investment is tailored towards profitability and all measures that could threaten the prosperity of such investment are considered before embarking on the business endeavor. Chiefs among dilemma that could come in the way of oil and gas investment are instability in pricing, political instability and regulatory dynamism which at its peak could climax into expropriation of foreign investments by the Nigerian government. Almost all the oil producing countries have had a taste in nationalisation of investments in the oil and gas sector which are almost immediately accompanied with crisis, conflict and bitter exchanges between the investors and the expropriating governments. Admittedly, there could be justifications for expropriation in some cases but experiences have shown that many governments of oil producing countries arbitrarily exercise their powers of expropriation to roguishly inherit the wealth, infrastructure and assets of investing foreigners in their oil sector and unfairly deny such investors the fruits of their labours. In as much as the principle of state sovereignty over their natural resources remains unassailable, this work, found that an exercise of a state‘s powers to expropriate needs to be done judicially and judiciously. Expropriation may only be resorted to in extreme situations bothering on national interests and even at that, the investors deserve justice, fairness and due process. And, this is the focus of this paper.