Yemi Osinbajo, the Vice President of Nigeria, has said oil theft and damage to oil assets threaten the country’s economy and security.
This is what Osinbajo said on Tuesday at the Abuja conference of the special investigative panel on oil theft and losses in Nigeria.
“Oil theft and sabotage of oil and gas assets are a clear and present danger to our economy and national security.
“Not only do they pose a serious threat to all exploration and our energy economy, but they also impact negatively on what is accrued to the federation and the business prospects on investors in the oil and gas sector,” Mr Osinbajo said.
In Nigeria’s oil-rich Niger Delta area, the number of oil thefts has increased in recent years.
In April 2022, Mele Kyari, the Group Managing Director of the NNPC Limited, said oil theft in 2021 cost Nigeria $4 billion, or 200,000 barrels per day. Last September, the NNPC stated that oil theft cost the country $700 million and 470,000 barrels of crude oil monthly.
In its draft fiscal strategy paper for 2023–2025, the federal government said that oil revenue did not do as well as it should have because of significant production shortfalls caused by pipeline vandalism and crude oil theft.
Osinbajo said on Tuesday that if the threat isn’t stopped, it will cause crises that will paralyze the government and leave the country very open to shocks and other unplanned events.
He said that when a lot of crude oil is stolen, it makes it harder for the government to reach its goals.
“Nigerian Extractive Industry Transparency Initiative (NEITI) put the audited figure of oil theft and losses at something in the order of 619.7 million barrels of crude oil daily. This is valued at $46 billion or N16.25 trillion, and all these losses occurred between 2010 and 2020.
“In addition, Nigeria lost about 4.2 billion litres of petroleum products from refineries, valued at over $1.4 billion at 140,000 barrels per day from 2009 to 2018.
“This is just an average because there are peaks where we see losses between 200,000 to 400,000 barrels in a day,” Osinbajo said.
“So grievous a crime cannot simply be a subject of summary; people must do their jobs, and if they are unable to do them, then there must be an accounting for such failures.
“Institutional and personal reputations are at stake. I think that is the cardinal reason we are here. I employ us to exhaust decisions on this matter,” he added.
He said that the situation might improve once people in the host communities, especially those who steal oil, are made aware of how important it is for the law to help them.
Babagana Monguno, the National Security Adviser (NSA), said that the problem of oil theft has gotten to a scary point.
“This is because the criminals have now increased the level of sophistication, considering the various methods they employ to tap primary pipelines with illegal secondary pipes to load on barges and sell to international collaborators or to process locally for illicit domestic sale,” he said.
“83 oil tankers involved in various crude oil and product theft have been arrested, while the theft of over 3 million barrels of crude oil was prevented and 11 million litres of petrol and diesel were recovered.”