Abuja — The Nigeria Extractive Industries Transparency Initiative, NEITI, Wednesday, stated that Nigeria lost $41.9 billion to crude oil and refined petroleum products theft in 10 years, from 2009 to 2018.
In a statement announcing the release of its Policy Brief, titled ‘Stemming the increasing cost of oil theft to Nigeria,’ NEITI declared that the country lost $38.5 billion on crude theft alone; $1.56 billion on domestic crude and another $1.8 billion on refined petroleum products between 2009 and 2018.
It argued that the value of crude oil and allied products so far lost are equal to the size of Nigeria’s entire foreign reserves.
It added that the amount the country lost in 20 months in fiscal terms, was enough to finance the proposed budget deficit for 2020; in 15 months to cover total proposed borrowing or increase capital budget by 100 per cent; and in five months to cover pensions, gratuities and retirees’ benefits for 2020.
NEITI further stated that Nigeria loses an average of $11 million daily which translates to $349 million in a month and about $4.2 billion annually to crude oil and petroleum product losses, arising from stealing, process lapses and pipeline vandalism.
It noted that paying priority attention to efforts to curb oil theft in the country’s oil and gas industry had become both necessary and urgent to expand revenue generation, especially in the face of current dwindling revenues, NEITI also appealed to the government to step up efforts to curb oil theft, as revenue to be gotten from the stolen crude would had helped in reducing budget deficits and external borrowing.
It blamed the prevalence of the crime on inadequate legal sanctions to serve as deterrent, while it called for stringent laws, deployment of technology designed to swiftly detect, localize and cut off flows to specific pipelines as soon as leakages occur.
NEITI urged the government to embrace oil fingerprinting technology, comprehensive metering infrastructure of all facilities, and other creative strategies to combat the growing menace of theft of Nigeria’s crude oil and refined petroleum products.
The agency also recommended operational, security, legal and global governance instruments to combat crude theft.
It also proposed efficient response and containment time in checking oil theft and pipeline vandalism, urgent review of the status of various security organizations currently involved in crude pipeline and product surveillance.
It said, “While figures from government put the loss at between 150,000 to 250,000 barrels per day, BPD, data from private studies estimate the figure to be between 200,000 to 400,000 bpd. This implies that Nigeria may be losing up to a fifth of its daily crude oil production to oil thieves and pipeline vandals.
“In terms of volume, 138.000 barrels of crude oil was lost every day for the past 10 years, representing seven per cent of average production of two million bpd. Nigeria lost more than 505 million barrels of crude oil and 4.2 billion litres of petroleum products between 2009 and 2018.
“What is stolen, spilled or shut-in represents lost revenue, which ultimately translates to services that government cannot provide for citizens already in dire need of critical public goods.
“Stemming this haemorrhage and leakages should be an urgent priority for Nigeria at a time of dwindling revenues and increasing needs.”