Thesis Preview

Many countries have problems with how they value their natural resources.  The undervaluation of natural resources often leads to large scale, irreversible environmental damage. For example, forests are frequently clear cut to make room for crops or livestock. The landowner is compensated quickly via the “stumpage” price for the timber harvested from his land. He is then able to enjoy quick returns from crops or livestock. In developing countries, the undervaluation of natural resources has resulted in catastrophic environmental degradation.
The same undervaluation of forestlands can also be applied to other natural resources as well. For example, a growing number of inhabitants in the Niger Delta are getting involved in the illegal oil refinery business in Nigeria. Oil is stolen from facilities of corporations working in the region on an industrial scale, processed into fuel in illegal refineries, and sold across West Africa.[1] Oil leaking from pipes after illegal extraction finds its way into the rivers, lakes, and ponds of the Niger Delta.
In both instances immediate returns are valued over long term sustainable solutions. This issue however is extremely pressing because of the high population growth rates of developing countries. As human population increases immediate returns from natural resources take precedent over long term sustainable solutions.
 Nigeria is my area of focus because over the past five decades oil companies operating there have a very poor operational track record. After decades of abuse and exploitation the locals have decided to take the oil industry into their own hands. The poor example set by oil companies for years has essentially become the norm for oil operations in Nigeria. Had these companies operated in a more responsible way there would be significantly less environmental damage and physical and financial harm.




[1] ‘Stolen Nigerian oil goes to Balkans and Singapore’, BBC News, 23 October 2012.

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