Economic Analysis of Potential Offshore Aquaculture Practice to Enhance Diversification of Blue Economy in Nigeria

Abstract

The oil and gas industry has long dominated Nigeria’s blue economic growth. However, a new frontier that can play sustainable economic growth in the maritime industry and therefore national economic leverage is offshore aquaculture. Hence, this paper aims to provide relevant information on the economic analysis of the potential offshore aquaculture practice to enhance the diversification of the blue economy in Nigeria using secondary data. Sensitivity analysis considering input variations of up to 45% is also performed to take care of the unforeseen. Offshore aquaculture in this paper refers to fish production in the Open Ocean using large cages/nets. Ten (10) fish cages of 37500-fish capacity per cage were hypothetically designed with fiberglass materials and installed in Escravos offshore. A mortality of 30% was used with the current prices of other required investments. The analysis recorded a breakeven period of 2 years and NPV value of over one trillion Naira in 9 years indicating massive profitability comparable to the oil and gas industry! Sensitivity analysis identified mortality/loss of fish and falling prices of fish as events that could adversely affect the investment. It is suggested that the investment should be done with experienced professionals in fishery, offshore engineering, and cost control.