Crude oil theft: NNPC admits revenue shortfall

NNPC-Andrew-Yakubu30 October 2013, Abuja – Group managing director of the Nigerian National Petroleum Corporation (NNPC), Engr. Andrew
Yakubu, has admitted that the persistent attacks on major crude oil arteries are having a negative impact on the nation’s revenue.

Continuous crude oil theft, pipeline vandalism and shut-ins have constrained the sector from meeting its revenue projection, he said.

Yakubu, who decried the persistent attacks on major pipeline arteries supplying crude oil to export terminals, during his submission to the Senate and House of Representatives Joint Committee on the Medium-Term Expenditure Framework (MTEF) for the period of 2014 to 2016, stressed that the menace has impacted negatively on the nation’s economy.

The oil and gas sector is a key component of MTEF, he said, adding that any impact on it will have a negative effect on revenue flow to the federation account.

He said: “The critical and most important point to note here is that when the artery conveying crude oil to the terminals is hit, this reduces our production volume by 150,000 barrels per day and, for the period that the line is down, that accounts for the drop in crude oil production.

“From February to date, we have witnessed so much breaches and each time we go down about 150,000bpd goes down.

“We have looked at the 2014 oil projection from a realistic point of view and we would continue to recalibrate it with the National Assembly and other relevant stakeholders to ensure that the petroleum sector continues to play a key role in the national economy.”

On the daily crude oil production figure, Yakubu averred that the production figure has been very erratic as a result of the several attacks on the arteries from February to date, adding that the daily crude oil production figure presently ranges between 2.2mpbd and 2.3mbpd.

He said that the NNPC actively participated with the Budget Office in arriving at the MTEF, adding that the corporation would do everything possible to ensure that MTEF is achieved in terms of accruals from oil and gas projected input.

For his part, the director-general, Budget Office, Dr Bright Okogu, affirmed that the activities of crude oil theft and pipeline vandalism coupled with the discovery of shale oil and gas were responsible for the inability of the NNPC to realise the projected 2.5mbpd crude oil production in 2013.


About the Author