A Review of the Nigerian Energy Industry

NEITI calls for national emergency over oil theft

Oscarline Onwuemenyi

22 May 2012, Sweetcrude, ABUJA – The Nigeria Extractive Industries Transparency Initiative, NEITI, has raised alarm over the increasing rate of oil theft going on in parts of the Niger Delta, stating that government should declare a national emergency to tackle the menace of illegal bunkering in the sector.

The Executive Secretary of NEITI, Mrs. Zainab Ahmed, stated this on Tuesday when she hosted members of the House Committee on Petroleum Resources, Upstream, who were on oversight duty at the anti-graft agency’s offices in Abuja.

Ahmed noted that a recent facility tour of Shell oil exploration activities in the Niger Delta conducted by the NEITI management, had revealed “mind-boggling theft of crude oil.”

“The increasing rate of stealing of crude through illegal oil bunkering activities in the creeks, the activities of oil thieves, proliferation of illegal refineries, pipeline vandalisation, and environmental pollution in the Niger Delta have risen to alarming proportions and has become a major threat to the nation’s economy,” she noted.

According to her, the disclosure by Shell Producing Development Company, SPDC, which manages the Bonny Oil and Gas Terminal that the nation’s economy has lost a whopping $4.3 billion to oil thieves in the last two years at an average rate of $2.3 billion annually “clearly underlines the fact that the problem has assumed the status of a national emergency.”

Ahmed noted that the lack of reliable information on the actual production capacity in the oil and gas industry further compounds the production, adding that operators in the industry are yet to adopt real-time technology that would determine the level of production, and thus the amount of products lost to oil thieves.

“I therefore wish to call for an urgent intervention by the National Assembly by way of passing a stringent law with clearly defined sanctions and penalties to curb this dangerous economic crime,” she stated.

Ahmed explained that the visit was coming “at a period when the National Assembly is showing greater interest in the management of the revenues from the oil and gas sector as demonstrated by the various public hearings and enquiries by the National Assembly, and most recently, the House of Representatives Fuel Subsidy probe.”

She pointed out that the report of the House of representatives on the fuel subsidy has “no doubt justified various NEITI’s audit reports, which have made similar shocking revelations of monumental corruption in the oil and gas sector.”

The NEITI boss, therefore, commended “the manner, commitment, openness, robust debate, constructive engagements, and the desire for depths and facts” which the National Assembly deployed in pursuing the fuel subsidy probe so far.

She further invited the legislators to debate the NEITI Audit reports just the way it debates the annual budget, since the revenues from the oil and gas sector constitutes the major chunk of the national budget.

According to her, “It is only NEITI Audit reports that provide authentic information and data on the revenues accruing to the Federal Government from the extractive sector. NEITI Audit reports are independent, distinct and unique from all other audit reports of the extractive sector as it is conducted in line with global best practices.

“NEITI wants the legislature to extend the same spirit and commitment it deployed in pursuing the fuel subsidy probe in considering the various reports audit reports from NEITI. For instance, the remedial issues identified in the NEITI Audit reports such as physical, financial and process lapses require legislative interventions,” Ahmed added.

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  • MYA may yet go down in history as the pesorn that turned around Nija. Of course OBJ would like that title, and to an extent he might be right. The problem with OBJ is that he is of the ‘old order’. Yes he kicked off the ‘Reform’ agenda, but he himself was basically an unreformed individual. He was incredibly corrupt and not averse to military tactics to get things done.But this is the nature of reform. One leader is the last of the old order, the next the first of the new order. Think, Gorbachev/Yeltsin, De Klerk/Mandela etc.Good luck to him.