A Review of the Nigerian Energy Industry

Poverty, hopelessness worsening oil theft

16 October 2014, Lagos – Apart from the lack of political will to totally stop oil theft and illegal refining of crude, poverty, impunity, hopelessness and deprivation in the country are said to be worsening the situation.

Oil theft, illegal refineries and other economic and environmental crimes, according to HEDA Resource Centre, cannot be eradicated without addressing these fundamental issues.

Crude oil theft

The Centre, in a communique released after a roundtable on ‘Transparency and Accountability in the Oil Sector’ organised in Lagos, any genuine effort aimed at combatting oil theft and illegal refineries must prioritise host communities (youth, women and men) as beneficiaries and co-owners of the resources and facilities.

Government, it said, should address oil theft and illegal refineries not only as acts of economic sabotage, but also as an environmental and public health concern. Thus, security agencies should conduct the demolition of illegal refineries without causing further harm to environment and public health.

According to HEDA, there is the need for the country to step up legislative oversight and citizens’ oversight of the activities of regulatory agencies and the Nigerian National Petroleum Corporation in the management of Nigeria’s oil resources.

It stressed, “Government should develop mechanism (including possible regulatory and licensing scheme for small scale petroleum refineries) to redirect and integrate the skills and energy of young people involved in illegal refineries and oil theft into productive economic engagement.

“It should adequately equip and motivate security agencies through leveraging on technology and a robust incentive regime to enhance their efficiency in the war against oil theft and illegal refineries. Stern disciplinary measures should be however employed to check criminal compromise by some security agents.”

The impact of oil theft and illegal refining, according to the body, was being felt in the social, economic and political lives of Nigerians. The increasing wave of internal insurgency, terrorism, violent crimes and other organised financial and economic crimes has been widely traced to the growing criminalities in the oil sector.

There was a general disillusionment among young people and a high level of impunity in the polity, according to participants at the forum, who also maintained that failure of International Oil Companies to comply with internationally acceptable operational and environmental standards was a crucial factor precipitating oil spillages, oil theft and illegal refineries.

According to them, regulatory agencies and the NNPC were poorly equipped and ill motivated to monitor oil production and perform allied functions; and security agents were largely compromised in the war against oil theft.




– The Punch

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