The Group Managing Director, NNPC, Mr. Andrew Yakubu, in a special keynote address at the ongoing Nigerian Oil and Gas Conference in Abuja on Tuesday, said the country lost 300,000 barrels per day, or 109,500,000 barrels in 2013 to severe attacks on its critical export pipeline system.
Oil theft is often associated with criminals who tap crude from pipelines for local refining. Stolen oil also leaves the country in tankers.
Yakubu said the incessant vandalism of crude oil export pipelines and domestic crude oil and refined petroleum product pipelines had resulted in negative consequences for the economy.
He said, “Nigeria has faced unprecedented challenges with regards to losses in production occasioned by incessant vandalism of crude oil export pipelines and domestic crude oil and petroleum product pipelines.
“In 2013, Nigeria – Africa’s largest oil producer – suffered severe attacks on its critical export pipeline system leading to the loss and or deferment of about 300,000 barrels per day. This deferred production is equivalent to the total production of Equatorial Guinea and larger than the entire production of Ghana, Congo Brazzaville, Cameroon and Gabon.”
According to the NNPC boss, Nigeria’s crude oil production is dependent on key arteries such as the Trans Forcados, Trans Niger, Nembe Creek line and Temidaba-Brass line, which connect three export terminals, Forcados, Bonny and Brass.
Yakubu said the pipelines were usually shut anytime they were vandalised, lamenting that the shut-ins of such significant production facilities had received the attention of the Federal Government, which had set aside N15bn to tackle the menace.
“The initiatives include the setting aside of N15bn for the purchase of security equipment to checkmate the scourge of oil theft in the Niger Delta approved by the National Economic Council,” he said.
Other measures to be taken to tackle the problem, Yakubu said, included the utilisation of new technology and radar surveillance to boost maritime security; increase in sea patrol by the Nigerian Navy; and inauguration of an inter-agency maritime operations coordination committee to provide synergy among agencies operating in the industry to ensure safety and security in the Nigerian maritime industry.
Others, he said, were the provision of air surveillance of the pipelines with modern aircraft manned by Nigerian pilots; and training under the Petroleum Technology Development Fund programme.
Royal Dutch Shell had earlier said that Nigeria was losing over $1bn monthly to the activities of oil thieves.
The oil major said the monthly $1bn oil theft figure was estimated and that the country might be losing more.
Industry analysts, who computed the figure over a 12-month period, concluded that the country must have lost at least $12bn to oil theft in 2013.
A Reuters report recently quoted Shell’s Chief Financial Officer, Simon Henry, as saying, “The theft is very material. Figures have been quoted up to $1bn a month being stolen from the government; in effect, and that figure is probably accurate.”
The oil major, which updated investors on its strategy in its annual report, also said that the proposed Petroleum Industry Bill had curbed investment and hindered production, while security was a daily challenge and oil theft “very material.”
– The Punch