CHAPTER ONE

INTRODUCTION 1.1                        

BACKGROUND TO THE STUDY

          A study of human history reveals a universal desire for security. The quest for security has been one of the most potent and motivating forces in material and Cultural Revolution. Early societies relied on family and tribe cohesiveness for their security. Insurance, in some form, has been a universal response to societies’ quests for security as it covers risks in many aspects of human endeavor including the petrochemical industry (Kenneth and Harold, 2005).

              Nigeria’s economy before independence and shortly afterward largely depended on agriculture; this is because a good number of its citizens were farmers. Agriculture then was her only source of foreign exchange through the sale of cash crops. Shortly after the independence and the civil war, Nigerian economy changed because of oil boom in the early 70s. This caused a significant neglect of its agricultural sector and other mineral resources which they are blessed with. The boom attracted foreign investors which include banks, insurance companies, oil producing companies etc. Among the early oil producing companies to exploit its share of Nigeria include British Petroleum Company (now SHELL), Uni Petrol etc.

          Petrochemicals are chemicals derived from petroleum or natural gas. They are obtained either directly from cracking (pyrolysis), or indirectly from chemical processing of petroleum oil or natural gas. Major petrochemicals are acetylene, benzene, ethane, ethylene, methane, propane and hydrogen from which hundreds of other chemicals are derived.

          The petrochemical industry and the products it makes play an enormous role in our daily lives. Imagine life without gasoline, cosmetics, fertilizers, detergents, synthetic fabrics, asphalt, and plastics. These products and many more are made from petrochemicals.