A Review of the Nigerian Energy Industry

Nigeria, UK lose N3.58tr annually to sea piracy

Suspected sea piratesIke Amos 13 August 2014, Sweetcrude, Lagos – Nigeria and the United Kingdom are losing £13.5 billion (about N3.578 trillion) a year to pirates’ activities in Nigeria’s territorial waters and off the coast of West Africa.

The UK Chamber of Shipping, in a report on trade activities, said piracy in Nigeria’s territorial waters and off the coast of West Africa is negatively affecting the economy of countries in the region, stating that the countries will remain poor until their waterways are secured.

The report said pirates and lawlessness off the coast of Nigeria and the Gulf of Guinea is costing Nigeria about £7.2 billion (about N1.51 trillion) yearly.

It also said insecurity in waterways in the territory is putting at risk £6.3 billion of UK’s trade, including 12 per cent of the country’s oil imports.

According to the UK Chamber of Shipping, there is at least one attack per week on a ship operating in the region, but up to two-thirds of attacks are believed to go unreported.

The chamber’s report noted that in 2013, 60 per cent of attacks on shipping in the area took place in Nigerian territorial waters, adding that there is a trend for increasing violence within attacks.

The UK Chamber of Shipping is the trade association for the UK shipping industry. With around 140 members from across the maritime sector, the chamber represents over 925 ships of about 30 million gross tons.

Chief Executive Officer, UK Chamber of Shipping, Guy Platten, also warned that the UK economy is heavily exposed to lawlessness off the coast of Nigeria.

He said, “Most people are aware of pirate activity off Somalia, but lawlessness in the Gulf of Guinea is a major threat to our seafarers, the UK’s energy and trade security, and to the economic development of the region.

“Nigeria and other states in the region have known for 30 years that piracy was a problem, but too little has been done and enough is enough.”

“Around 12 per cent of the UK’s crude oil is imported from Nigeria, and by 2050 the region will hold 25 per cent of the world’s oil production. Around 5,000 vessels, of all nationalities, call at Nigerian ports every year. Nigeria’s own statistics show that 300,000 barrels of oil are stolen every day,” he further stated.

The report called on the British government to step up efforts towards building maritime governance in the region, using UK-based expertise to help train local law enforcement judicial services and making sure criminals are brought to justice.

This, the Chamber said, has become necessary, especially after the country had identified and linked activities in the region to its economic development.

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