SOURCE:

Faculty: Management Sciences
Department: Business Administration

CONTRIBUTORS:

Ufomba, R. E.
Akpan, P. L.

ABSTRACT:

This study centers on grievance management and performance of oil producing companies in oil host communities of Niger Delta region of Nigeria with particular reference to Shell Petroleum Development Company (SPDC) and National Agip Oil Company (NAOC). Ill managed grievances are associated with lack of basic infrastructure, pipeline vandalism, oil spills, economic underdevelopment, deprivation, poverty, and environmental degradation. Among these are the fundamental problems necessitating this study. Despite expected benefits by the host communities in the Niger Delta region, the problem seems to be on the increase. This has impacted on the production activities and profitability of oil producing companies. Thus, the major objective of the study is to ascertain the implications of grievance management on the performance of selected oil producing companies in the Niger Delta region of Nigeria. Specifically, it examines the extent to which grievance management affects the Profitability of selected oil producing companies in the Niger Delta region of Nigeria. Again, the research seeks to determine the implication of grievance management on the market leadership (market share) of selected Oil Producing Companies in the Niger Delta region. Furthermore, it ascertains the extent to which oil spills affect economic development of host communities in the Niger Delta. Fourthly, it ascertains the extent to which oil pipeline vandalism inhibits sustainable community development of host communities in Niger Delta. Survey Research design was adopted for the study while the methods triangulation technique was used to obtain qualitative and quantitative primary and secondary data for analysis. Data generated were presented in tables, bar chart, pie charts and percentages. Multiple regression analysis was employed to test hypotheses One and Two, while Pearson Moment Correlation, t-statistics were employed to test hypotheses three and four. Findings from the regression analysis show that the estimated coefficients of grievance management significantly affect profitability. R2 is 0.47, which implies that 47% variations in the profitability level of SPDC are caused by the grievance management variables. Findings also reveal that there is a significant effect of oil spills on the economic development of host communities in the Niger Delta. The study recommended that petroleum Companies should institute effective grievance management channels by which oil host communities can voice their concerns about the operations of an oil producing company and get these concerns addressed to avoid the disquiet that ignites grievances and conflict which has implications on the performance of oil companies, leads to man hour loss, and diminishes profitability.