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View next figure 2. The Niger Delta, which is home to some 31 million people [ 24 ], occupies a total area of about 75, km2 and makes up 7. This region cuts Shell political risk essay over Shell political risk essay communities with an extensive network of over producing oil wells and several petroleum production—related facilities [ 25 ].
The ecological zones in the Niger Delta region can be broadly group into tropical rainforest in the northern part of the Delta and mangrove forest in the warm coastlines of Nigeria. Mangrove forests and swamps, which are characterized by regular salt—water inundation, lie at the centre of a complex and sensitive ecosystem which is vital to the local economy and accommodates important flora and fauna [ 26 ].
The Niger Delta, which is the largest mangrove forests in Africa and the third largest in the world, is the richest part of Nigeria in terms of petroleum resources and diverse natural ecosystems supportive of numerous species of terrestrial and aquatic fauna.
Advances in evaluation and improved seismic technology showed that the Niger Delta petroleum systems consist of Lower Cretaceous lacustrineUpper Cretaceous—lower Paleocene marine and Tertiary deltaic [ 22 ].
The geological assessment of the source material has shown that the principal source for oil and gas in the Niger Delta belonging to the tertiary deltaic petroleum system [ 2223 ]. Over the past five decades, a total of about 1, exploration wells have been drilled to date in the delta basin, and about oil and gas fields of varying sizes have been documented [ 27 ].
These pioneering efforts ended abruptly with the outbreak of the World War I in The giant Bomu oil field, which has estimated ultimate recovery EUR of 0. The petroleum sector began to play a vital role in shaping the Nigerian economy and political destiny of the country in the early s.
When Nigeria became an independent nation on 1 OctoberShell—BP began to relinquish its acreage and its exploration licenses were converted into prospecting licenses that allowed development and production [ 2931 ].
Following the increase dominance of the Nigerian economy by petroleum sector, the sole concession policy was abandoned and exclusive exploration right was introduced to encourage other multinational oil companies aimed at accelerating petroleum exploration and production. Most of these multinational oil companies recorded considerable successes in oil and gas exploration and production in both onshore and offshore fields in the Niger Delta.
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According to Vassiliou [ 29 ], 17 of giant oil and gas production fields are located offshore and some of the examples include Bomu, Oso, Ubit, Assan, Meren, Abo, Bonga, Bonga Southwest and Agbami, etc.
Bonga and Bonga Southwest were discovered in andrespectively and are operated by a joint venture led by SPDC [ 29 ]. Environmental Regulation of Oil and Gas Exploration and Production in Nigeria There are many approaches that have been developed for the safety and management of environmental impact of oil and natural gas exploration and production operations in the Niger Delta.
The emergence of Niger Delta as one of the most ecologically sensitive regions in Nigeria has led to the institutionalization of several statutory laws and environmental regulations to regulate the Nigerian petroleum industry.
Over the past years, the Nigerian Federal Government has promulgated laws and regulations so that oil and gas exploration and production operations, on both onshore and offshore oilfields, could be controlled by systems of limits which aim at minimizing the associated environmental impacts.
According to Salu [ 34 ], most of these statutory laws and regulations provide the framework for petroleum resources exploration and exploitation in Nigeria and only some of these environmental regulations give guidelines on issues of petroleum pollution.
Although the environmental laws and regulations in Nigeria have been poorly implemented, numerous environmental agencies have regulations that affect the exploration, development and production operations in the petroleum industry in Nigeria.
The establishment of FEPA in significantly changed the legal status quo of environmental regulation in the Nigeria petroleum industry. Under the FEPA Act, penalties and enforcement mechanisms were imposed, multinational oil companies could be held liable for costs of clean—up, restoration and multinational oil companies could pay compensation to parties injured by their illegal practices.
However, the existing statutory laws and regulations for environmental protection applicable to the Nigerian petroleum industry appear to be grossly inadequate and ineffective [ 793536 ]. Over the past fifty years, the multinational oil companies operating in the Niger Delta region have failed to adopt sustainable exploration and production practices due to increased costs of complying with environmental regulations.
Although comprehensive system of environmental regulations is now in place, environmental pollution associated with oil and gas exploration and production operations has continued to persist under these laws for several reasons.
Therefore, unsustainable petroleum exploration and production practices and poor environmental management practices has impacted on the atmosphere, controlled waters, soils and sediments, biological diversity and sustainability of the natural ecosystem in the Niger Delta region for several decades.
According to Graf [ 39 ], there is evidence to indicate that crude oil sales income as a proportion of foreign exchange earnings escalated from 2. Therefore, effective understanding of unsustainable exploitation of natural resources has helped shape our views of economic development from narrow economic interest to one that comprehensively embraces human, social and environmental factors in recent years.
Poor management of the petroleum resources has led to socio—economic, socio—political and complex interaction problems involving the people, economic development and the environment.Shell can state through the media and in their review about spillage reduction.
This will improve Shell image in the eyes of customer as Shell might assert to be less environmental risk. As a result, Shell may increase business profitability and attract new customers.
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Discuss what has made Shell’s operations in Nigeria more at risk and simultaneously more valuable. Examine the implications of the economic system found in Nigeria and explain the political risks that Shell faces in this country.
"The improvement notice has prompted Shell to revisit the risk assessments and the effectiveness of operational control measures in the potable water management system," said a spokeswoman. The way of assessing the effectiveness of Temasek’s political risk management strategies would be to evaluate gains and losses that may be associated with the political risks which were taken.
Temasek investment portfolio and approach expose it to higher political risk. Mar 20, · Post-traumatic stress disorder (PTSD), a complex and chronic disorder caused by exposure to a traumatic event, is a common psychological result of current military operations.
It causes substantial distress and interferes with personal and social functioning. Consequently, identifying the risk.