NIGERIA: DELTA STATE DEVELOPMENT PROGRAM CLAIMS

C O N F I D E N T I A L SECTION 01 OF 03 LAGOS 000138

SIPDIS

STATE PASS NSC FOR BOBBY PITTMAN

E.O. 12958: DECL: 06/25/2016
TAGS: PGOV PREL PM EPET ECON KDEM NI
SUBJECT: NIGERIA: DELTA STATE DEVELOPMENT PROGRAM CLAIMS
CREATION OF 6,000 JOBS

REF: LAGOS 066

Classified By: Consul General Donna M. Blair for Reasons 1.4 (B,D)


1. (C) Summary: Gary Akpobire, Director of the Delta State
Integrated Development Agency (DIDA) told Pol-Econ Chief on
February 17 that Delta State's development plans are
proceeding apace. The state plans four new gas-fired power
plants to drive industry, but Akpobire seemed unaware of
problems resulting from gas shortages occasioned by the low
domestic price paid for gas. Delta State has signed
investment agreements with Abu Dhabi and with the China
Investment and Trade Commission (CITIC). Delta State is also
in the process of recruiting 5,000 new teachers; the state's
teachers have been paid on time for the last eight years, and
work consistently without striking, the Majority Leader said.
Delta is improving health care to citizens by providing free
maternity care and eye treatments, and upgrading clinics.
Akpobire claimed that the Delta State Oil-Producing Areas
Commission (DESOPADEC),which pioneered the concept of
modular refineries for the State, is unable to manage the
refineries once constructed, further evidence of a power
struggle over control of the refineries. To streamline
dispute resolution, the State will establish an alternative
dispute resolution system in the courts, and set up a system
for handling community clashes over land. Concerned about
the impact of oil and gas spills on the health of the
population, the State Assembly is looking into the issue.
While Akpobire's plans to upgrade systems are commendable,
most appear still to be on the drawing boards as the State
looks for investors or other partners. One industry with
both a ready-made domestic market for its product and almost
unlimited capacity to provide for its own power needs is the
refining industry. Chief Okirika originated the idea of
building modular refineries in Delta State (Ref) but the
State Government has tried mightily to take ownership of the
concept. Hopefully, the arm-wrestling will not strangle the
development of this potentially important project. End
Summary.


2. (SBU) Gary Akpobire, Director of the Delta State
Integrated Development Agency (DIDA),Paul Owumi, Assistant
to Delta State Governor Emmanuel Uduaghan, Mrs. Irene Imilar,
Majority Leader, Delta State House of Assembly; and Princess
Pat Ajudua, Minority Leader, Delta State House of Assembly,
met with Pol-Econ Chief on February 17 to describe
development underway in Delta State.

Development Plan Contingent on Power Generation
-------------- --


3. (SBU) Development of infrastructure projects in Delta
State, pursuant to the Delta State Master Plan which Akpobire
has shepherded over the past two years, is underway. The
state is clearing sites for four power plans; these will be
gas powered, and constructed under partnership with the
international oil companies (IOCs) (Note: Akpobire did not
say whether the IOCs had agreed to the plan. End Note). Delta
State, like Rivers, already has in place a gas
infrastructure, which it plans to expand, that will bring gas
to the plants. Ten thousand mw plants are planned for Asaba
and Warri, while smaller 2,500 mw plants are planned to drive
industry and serve offgrid areas of the state. Asked about
the availability of gas at the current price, Akpobire
shrugged off the question, saying "Delta State is the source
of Nigeria's gas." Investors had expressed interest in
purchasing the power, Akpobire said, which will allow the
state to establish a manufacturing base, and guarantee
sufficient electricity to power water purification,
telecommunications and internet technology, and waste
management systems. The Ports of Dubai and Singapore have
both expressed interest in helping Delta develop its deep sea
port. The Warri airport will be expanded, and the State
hopes to see it become a hub between Argentina, Brazil and
Russia.

Abu Dhabi Signs Investment Agreement
--------------


4. (SBU) The State has signed two investment agreements, one

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with Abu Dhabi, and the second, worth 1.4 billion naira, with
the China Investment and Trade Corporation (CITIC). Pan
Ocean, an indigenous oil company, is planning to build a gas
treatment plant that will "dry" the wet gas produced in the
area. Gazprom is also interested in the state's gas. Bratts
is preparing to construct a shopping mall, and the state is
making plans to assure that there are 15,000 rentable rooms
available. The assets of Panalpina, an oil services firm
that left Nigeria in the wake of a corruption scandal, has
been sold to a consortium; the consortium will re-open the
business near the port of Warri.

State Recruits 5,000 Teachers
--------------


5. (SBU) To improve education in the state, Delta is
recruiting 5,000 new teachers. The state has placed
application forms in all the banks, so it will be easy for
potential applicants to access them. Over the past year, the
state has recruited professionals to train in welding for
pipeline repair, dredging, construction and software
engineering. The state's Ministry of Education has also been
revamped. The Ministry has been split in two, with one half
devoted to higher education and the second to lower
education. The higher education focuses on the university
and the polytechnic institutes to ensure that graduating
youths reach a certain level of proficiency. For lower
levels of education, a uniform standard has been adopted so
that the State can assure that the quality of education in
the riverine communities is the same as in Asaba, the State
capital. Teachers are all getting training, and receiving
standard textbooks from which to teach. The State
Commissioner of Education has been recruited from the UK, and
a former University of Lagos professor has been recruited to
oversee the State's higher education. According to Majority
Leader Imilar, teachers have been paid promptly at the end of
each month for the past eight years, which has assured that
Delta State teachers have not had to go out on strike.

State Improves Health Care Delivery
--------------


6. (SBU) The state is providing free maternity care, and free
eye care to citizens. The state has upgraded health centers,
which are now all staffed by doctors. Delta State has the
highest HIV prevalence in the country, so the Majority and
Minority leaders have cooperated on a bill that will educate
and sensitize the public to the problems of HIV-AIDS, and
make treatment available at both the state and local levels
of government. The state is increasing the number of
specialty hospitals in the state. There will be a teaching
hospital specializing in heart and respiratory medicine at
Ogara. A second specialty hospital will be built in Asaba,
to supplement the services being provided by the existing
Baptist hospital, located near the center of the state, and
the old Warri hospital.

State Taking DESOPADEC's Modular Refineries?
--------------


7. (C) Delta State Oil Producing Areas Development
Committee (DESOPADEC) Chair Chief Wellington Okirika is
currently in the United States to inspect a modular refinery
that he wants to have installed, Akpobire said. However,
DESOPADEC does not have the ability to operate the refinery,
Akpobire alleged. As a result, the two women legislative
leaders will travel to the United States to see the Ventech
and other modular refineries. (Comment: Both the Majority
and Minority leaders are Itsekiri, as is Delta State Governor
Uduaghan, while Chief Okirika is Ijaw. There are indications
that the Governor has been holding up DESOPADEC's progress on
the refineries, an idea initiated by Chief Okirika. That
this Itsekiri delegation is traveling to the United States
independently of Chief Okirika appears to be further evidence
of a power struggle over control of the modular refineries.
End Comment)

Dispute Process Will Reduce Clashes Over Land
--------------


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8. (SBU) The state has had four or five clashes between
communities over land during Akpobire's tenure. These
clashes are essentially boundary and border disputes, which
tend to be over extremely small plots of land, and to begin
when the planting season begins in the spring. From studying
these disputes, Akpobire is convinced that if poverty is
alleviated, communal clashes of this type will be fewer and
fewer. However, to handle those disputes that do arise, the
State plans to commence a land dispute resolution process
through which a land security officer will mediate disputes.
This program will roll out during the second half of this
year, Akpobire said. To speed resolution of other civil
disputes, the Majority Leader has sponsored a bill promoting
Alternative Dispute Resolution (ADR) as an adjunct to the
court system, she said.

Study of Oil Spill Effect on Health Underway
--------------


9. (SBU) The State is concerned about the impact of oil and
gas spills on the health of the communities, Akpobire said.
The State Assembly's Chair of the Oil and Gas Committee has
begun looking into this issue. While the State has done
studies on the impact of the spills on economic activity,
such as reduction in fish stocks, the health aspects of
spills have not yet been studied. Akpobire said he had heard
of cancers and eye problems, the latter the result of gas
flaring. Once the data is collected, the State will use it in
an effort to end flaring and clean up the land.


10. (C) Comment: While Akpobire's plans to upgrade systems
are commendable, most appear still to be on the drawing
boards as the State looks for investors and other partners.
One industry with both a ready-made domestic market for its
product and almost unlimited capacity to provide for its own
power needs is the refining industry. Chief Okirika
originated the idea of building modular refineries in Delta
State (Ref) but the State Government has tried mightily to
take ownership of the concept. Hopefully, the arm-wrestling
will not strangle the development of this potentially
important project.

BLAIR