The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) says the country lost about $3.27 billion worth of crude oil to theft between January 2021 and February 2022.
The commission disclosed this during a presentation on crude oil theft at a stakeholders’ engagement with the Oil Producers Trade Section (OPTS) and the Independent Petroleum Producers Group (IPPG) in Abuja on Thursday.
OPTS is the umbrella body of major international and indigenous operating oil companies, while IPPG is an association of indigenous exploration and production (E&P) companies.
The NUPRC had said the country loses more than 115,000 barrels per day to oil theft and vandalism.
On Tuesday, the commission announced it had set up a panel to audit activities of operators in the upstream sector to ascertain the actual volume of oil lost to theft.
On the trend in oil theft, the NUPRC said: “Total value loss for the period January 2021 to February 2022 is about $3.27 billion”.
“Average monthly value loss for the period is about $233.99 million. Average daily value loss for the period is about $7.72 million.
“Losses are mainly from Bonny Terminal Network, Forcados Terminal Network (and) Brass Terminal Network.”
The commission delineated factors that aided crude oil theft to include inadequate security, poor community engagement, economic challenges, poor surveillance, stakeholder compromises, and exposed facilities.
It said spillages and leakages were caused by activities of saboteurs affecting the source of livelihood of the community members and leading to environmental degradation.
It, however, noted that efforts are ongoing to mitigate crude oil theft and pipeline vandalism, as a work team comprising the regulator and operators was set up in August 2021.
“The work team was set up to deliberate on workable solutions to mitigate crude oil losses, identify various responsible parties along the crude oil loss value chain and propose improvement areas for effective surveillance,” the NUPRC said.
On the impact of the illegal activities, the NUPRC said government revenue was adversely affected.
Also, it said there had been a loss of value stemming from soaring costs owing to frequent repairs of damaged facilities.
Gbenga Komolafe, chief executive officer, NUPRC, said: “The meeting was convened to get the opinion of stakeholders, especially the investors, which include the OPTS and IPPG. It is the concern of the government that we increase our oil production.”
“Because when the upstream is sick, it affects the well-being and health of the country. The situation is happening upstream and is a threat to the existence and wellbeing of the economy.
“So we are very concerned about this, and we’ve been doing a lot and will ensure that we do everything possible to increase oil production in a manner that will make the nation benefit from the upward movement in the international prices of crude.”
Recently, the federal government said it had collaborated with security agencies, operators, and relevant stakeholders, to clamp down on the activities of oil thieves.
Source: Top Stories