Oil Theft in Nigeria; PENGASSAN Alleges Military Connivance

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CEM REPORT, OIL & GAS | Petroleum and Natural Gas Senior Staff Association (PENGASSAN) has alleged that the Nigerian Military and other security agencies were aiding and abetting criminals in stealing and lifting crude oil.

They also allege that the theft is with the active connivance of the regulatory agencies in charge of the nation’s petroleum industry.

PENGASSAN President, Festus Osifo, made the allegations at a one-day investigative hearing to the Senate Adhoc committee investigating oil lifting, theft and the impact on petroleum production and oil revenues.

He specifically alleged that the military should be held responsible for the high rate of crude oil theft in the country noting that men of the Amphibious Brigade in Port Harcourt and their counterparts in the Navy were conniving with superior officers at different times, joined the locals in the theft.

“One of the greatest problems we have, which nobody has highlighted is that there is strong connivance of our security forces in the crime.

“There is no doubt about this. From our Army to our Naval officers, we have information that they pay their superiors to post them to some areas in the Niger Delta.

“I can authoritatively inform this committee that men of the Nigerian Army and the Navy pay their superiors to be posted to Niger Delta.

”Even when the former Commander of the Amphibious Brigade in Port Harcourt was removed, many of the men in the Command resisted being posted out due to lucrativeness of their operational area.”

He also identified problems of oil theft, vandalism of pipelines, and host communities’ issues as major issues affecting the nation’s oil revenues.

[READ ALSO] NUPRC Implements Policy to Curb Oil Theft

Chairman, of the ad-hoc committee, Senator Akpan Bassey, raised the alarm that its efforts in the passage of the Petroleum Industry Act (PIA) stand frustrated if the current massive oil theft in the country is not swiftly curbed.

He noted that the country had incurred a loss of over $2.1 billion (about N872 billion) as a result of oil theft and sabotage.

He also added that monitoring by operators as well as the unwillingness of security agencies to checkmate the incidents of oil theft close to where they are stationed were major contributors.

He lamented the massive crude theft in the oil-producing areas of the Niger Delta region and noted that the development was crippling the nation’s economy.

“The quota from the Organisation of Petroleum Exporting Countries is about 1.8 million barrels per day but we are producing less than 1.2 million per day, showing a shortfall of 600,000 bpd. How do we meet our fiscal challenges?

“It is clear that the PIA/Host Community law we put in place is not the solution. If stealing crude has taken this worrisome dimension, what can the host communities do?

“We didn’t see any pipeline physically and nobody could ascertain the right of way.

“I still believe that PIB/Host Community law put in place is not the solution to oil theft. The law would not achieve its intendment if the current massive oil theft is not addressed.”

 “We’ve carried out an on-the-spot assessment of the Niger Delta area where we spent over one week trying to find out what was actually going on.

“We spoke with necessary stakeholders and many of us returned to Abuja very sad because our investigations revealed that it was nothing but a national calamity.

“We are losing more than 900 barrels per day. A barrel is made up of 159 litres of crude. Most of the pipelines had been covered by bush, making it very unsafe for any security personnel to assess and secure the facilities.

“This is the worst form of economic sabotage which needed a strong political will to tackle but at the same time, it required legislative input to address.

“Stakeholders are also complaining about the roles of regulatory agencies which they claimed was not good enough to guarantee ease of doing business.”

Bassey also lamented that the Bonny Terminal, being operated by Shell, which hitherto produces 60,000 barrels per day (bpd) has not produced a single barrel for the past seven months.

Present at the hearing were representatives of Shell, Total LNG, Chevron, SPDC Nigeria, Ministry of Trade and Investment, Nigeria Upstream Regulatory Commission, Fiscal Responsibility Commission, Inspector General of Police, Federal Inland Revenue Service, National Security Adviser, and the Petroleum and Natural Gas Senior Staff Association (PENGASSAN) who made presentations before the panel.

The Executive Commissioner, Corporate Services and Administration in NUPRC, Jide ADEOLA, during his presentation, estimated that about 95.4 million litres or 600,000 barrels, (since a barrel contains 159 litres) of crude oil were being stolen daily.

He said as of today, Nigeria produces 1.23 million barrels of crude oil per day as against the 1.8 million barrels targeted, leading to total revenue loss as of today, to be $2.1 billion or (N877 billion).

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