Compulsory acquisition of oil exploration fields in Delta State, Nigeria: The compensation problem

Abstract

Purpose

The purpose of this paper is to focus on the problems of compensation for compulsory acquisition of oil exploration fields in Delta State with particular reference to the oil field acquired by Agip Oil Company for gas pipeline way leave in Irri and Okpai towns of Delta State.

Design/methodology/approach

A survey was conducted in which questionnaires were administered on some residents whose lands were acquired compulsorily on one hand and some estate surveying and valuation firms who are professionals in the fields of compensation on the other hand. The data collected were analyzed and presented using simple statistical methods.

Findings

The findings in this paper show that the compensation paid to residents whose lands were acquired is grossly inadequate, since professionals are not always involved in the process.

Practical implications

The paper shows that the issue of compensation for compulsory acquisition for oil exploration is very central in the oil‐rich Niger‐Delta, and if this is not handled carefully, it can lead to uncontrollable crisis.

Originality/value

This paper empirically examined the process involved in compulsory acquisition and compensation of land in the Niger‐Delta for oil exploration with a view to determining the adequacy or otherwise of the compensation paid.

Citation

Ogedengbe, P.S. (2007), "Compulsory acquisition of oil exploration fields in Delta State, Nigeria: The compensation problem", Journal of Property Investment & Finance, Vol. 25 No. 1, pp. 62-76. https://doi.org/10.1108/14635780710720171