The recent revelation by the Minister of State for Petroleum, Timipre Sylva, that Nigeria loses a staggering 400,000 barrels per day (bpd) to oil thieves is gravely worrisome. To illustrate the severity of this problem in the preceding period, this loss translates to a steep drop in production from 1.8million bpd to 1.4 million bpd, thus falling short of the August 2022 production quota of 1.830million bpd allocated to Nigeria by the Organisation of Petroleum Exporting Countries (OPEC).
In this period of modestly high oil prices hovering in the region of $100 per barrel, this translates to a direct cash loss of about $40m daily! Given the global cost of living crisis, Naira in its current free-fall and the foreign exchange illiquidity, to list a few of our depressingly distressing indices, this is a bad time to be experiencing such alarmingly high losses.
As rightly observed by Mr Sylva, who has been on a tour of Niger Delta states with members of the anti-oil theft committee including the Chief of Defence Staff, General Lucky Irabor and the Group Chief Executive Officer (CEO) of the Nigerian National Petroleum Company (NNPC), Mele Kolo Kyari, Nigeria’s production has dropped drastically to very unsustainable levels. Remarkably, other industry stakeholders like the Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, Chairman Heirs Holdings, Mr Tony Elumelu, Managing Director, ExxonMobil Nigeria, Richard Laing, and Head Corporate Relations, Nigeria, Shell Petroleum Development Company (SPDC), Igo Weli, among others, have sounded similar alarm bells.
Admittedly, the massive larceny of Nigeria’s oil did not start in the time of the current administration as successive administrations have been unable to curtail this grand theft. The trend has however spiralled geometrically and has attained such a disturbing dimension under the present administration because it is plainly evident that the perpetrators have taken advantage of the prevailing circumstance to escalate their brigandage to such a debilitating level that is pushing the country close to bankruptcy.
According to a March 2022, Nigeria Extractive Industry Transparency Initiative (NEITI) report, Nigeria lost a whopping $2billion to oil theft and vandalism in 2020, plunging the country’s revenue downward by over 40 percent. The Nigerian Upstream Petroleum Regulatory Commission reports that in the first quarter of 2022, Nigeria lost $1 billion to crude oil theft, while the Organisation of Petroleum Exporting Countries puts Nigeria’s loss at 2.3million barrels in July 2022 alone!
The shortage of revenue lost to cushion the effects of the domestic and global economic downturn has meant that every Nigerian has been adversely affected by these developments. It is against this background that the National Association of Seadogs (Pyrates Confraternity) condemns this continuing brazen, disheartening and unacceptable theft. It is bewildering that with the number of security agencies including the Joint Task Force, (Operation Delta Safe), the Nigerian Navy, the Nigeria Security and Civil Defence Corps (NSCDC) and the special squad of the Police and Department of State Security deployed to guard oil assets, the industrial scale stealing of crude oil in the Niger Delta is continuing unabated.
Whether stealing from vandalised pipelines which fuel the many illegal refineries across the Niger Delta region or from oil fields, and oil terminals, the unfettered access to Nigeria’s oil by oil thieves has forced the country into financial distress with grim implications. Buffeted by declining revenue and resorting to binge borrowing to bridge revenue shortfalls, Nigeria’s government has not responded to the national emergency on its hands as competently as we should expect. And just like the lingering and unresolved security challenges in some parts of the country, these economic saboteurs appear invincible, giving rise to justified general suspicion of collusion with officials and elements of the security agencies, the very entities charged with the responsibility of preventing this disruptive felonious conduct.
We note that despite repeated warnings by some security services to their personnel against the dangers of hobnobbing with criminal elements involved in sabotaging the economy through oil theft, the menace has persisted. In plain terms, the ongoing court-martial of 13 personnel of the Nigerian Navy including officers for alleged complicity in oil theft is quite instructive. This should be an eye-opener for the Federal Government and compel it to adopt more stringent measures to tackle the problem comprehensively. We call on the Federal Government to ensure the swift and diligent prosecution of the case and bring everyone, no matter how highly placed, to justice.
Despite efforts at diversification, the oil and gas sector remains the mainstay of Nigeria’s economy. Therefore, any threat to the sector must be considered and treated as a high security concern deserving urgent and decisive action. To this end, we call on President Muhammadu Buhari to appreciate that Nigeria is dealing with organised crime at its most daring and sophisticated depth and so should demonstrate brave and decisive leadership by taking concerted action towards unmasking the thieving cartel as well as their internal collaborators within the locals, and in all the security agencies. We believe that a total overhaul of Nigeria’s security architecture in the maritime domain is an essential and major step towards cleaning the Augean stables.
We also demand that the Nigerian Senate make public the findings of the 13-man ad-hoc committee set up to probe oil theft in Nigeria and its impact on petroleum production and oil revenues. It is worrisome that the committee which was given one month to submit its report has yet to make the same public four months later.
In addition to the deployment of technology by the NNPC to monitor oil theft and the involvement of host communities in surveillance of oil pipelines, the government should enact laws that prescribe very harsh penalties for oil theft and pipeline vandalism. The National Assembly should equally support the call for more punitive measures in our statues to serve as deterrents to oil thieves. A situation where nine suspected oil thieves standing trial for stealing N200 million worth of oil in 2015 were, in 2022, fined N2,000 each owing to a plea bargain after an amendment of charges which was questioned by the trial judge, Justice Okon Abang, trivialises the entire essence of prosecutorial commitment and should not be allowed to ever reoccur. Therefore, NNPC Limited’s CEO, Mele Kyari’s call for a special court with diligent prosecutors to try oil thieves should be urgently and anxiously activated in national interest.
More importantly, the Federal Government should rethink its neglect of oil producing communities in terms of basic social amenities to seek support of host communities in driving the fight to end oil theft. Intelligence gathering can only be possible if the locals have a sense of belonging and see themselves as participants in and owners of the process.
President Muhammadu Buhari has the crucial task of curbing oil theft, Delivery on this key intervention is an obligation from which the government cannot resile or renege.