- ‘Fed Govt spends $1.5b on pipeline protection’
- Military seeks supports to raise oil production
Speaker of the House of Representatives, Hon. Abbas Tajudeen yesterday said that the country has so far this year lost about $10 billion in revenue to crude oil theft, vandalism and other forms of sabotage in the oil and gas sector.
Speaking at the commencement of an investigative hearing on crude oil theft and revenue losses, Abbas said it was practically impossible for the government to meet its daily obligations to the people with such huge revenue loss.
He spoke just as the Secretary to the Government of the Federation (SGF), George Akume said the government was spending not less than $1.5 billion on pipeline surveillance with a view to preventing crude oil theft leading to huge revenue loss.
Akume said available records from the Nigeria Extractive Industries Transparency Initiative revealed that about $46 billion worth of crude was stolen between 2009 and 2020.
The Defence Headquarters has also said it was galvanising the support of host communities and other stakeholders in the oil sector to ensure seamless crude exploration and exploitation in the Niger region.
Director of Defence Media, Operations, Maj-Gen Edward Buba, at a press briefing at the Defence Headquarters yesterday in Abuja, said troops were also reinforcing surveillance efforts on vessels, terminals and oil infrastructures to include jackets that house well heads, as part of efforts to ensure crude oil production in the oil-rich region.
Abbas said that those sabotaging the oil sector were known and would be unmasked by the House through the investigation, regretting that those saddled with the responsibility of managing the affairs of the nation has resorted to self-service and have decided to serve themselves.
He said the investigation underscore the commitment of the House to protect the nation’s resources for the good of all citizens, and deal decisively with the perpetrators of oil theft, vandalism and other criminalities in the oil and gas sector.
The Speaker said Nigeria depends largely on oil for its national revenue, adding that while the present administration is doing everything possible to diversify the economy and ensure significant revenue generation in the non-oil sectors of the economy, it is not relenting in the effort to rid the oil and gas sector of corruption and all forms of criminality.
“The statistics on crude oil theft is very alarming, and its negative impact on the economy is quite monumental. For instance, it is estimated that between January and July 2024, Nigeria lost an average of 437,000 barrels of crude oil per day due to theft, vandalism and other criminal activities. At the current price of oil, this translates to over $10 billion over the same period.
“Apart from reduced government revenue to address the multi-faceted challenges of national development, other problems associated with crude oil theft include environmental degradation, heightened insecurity in the form of piracy, kidnapping, militancy and vandalism, and the shut-down of production by many companies among others.
“The reduction in government revenue has invariably been responsible for government borrowing to address budget deficits over the years. Unfortunately, this has astronomically raised the debt burden of the country while also denying the country the optimal capacity for growth and development.
“If we must make progress as a nation, renew the hope of Nigerians and meet their yearnings, this appalling situation cannot be allowed to continue unabated.
This is even more compelling in view of the commitment of President Bola Ahmed Tinubu to increase oil production to 2.6 million barrels per day by 2027 and 4 million barrels per day by 2030.
“To achieve these targets, the President had promised to ensure collaboration between security agencies and oil industry operators to stem the tide of oil theft. It is against the backdrop of this declaration that the President recently directed the Chief of Defence Staff to deal decisively with oil theft and pipeline vandalism within the shortest possible time in order to restore national production to the level befitting the status of Nigeria as one of the largest oil producers in the world.
“It is gratifying to note that the Chief of Defence Staff has responded swiftly to Mr. President’s directive, and I am hopeful that the current effort will yield positive results. Recently too, the administration approved the procurement of advanced solution technology to tract every cargo of crude oil loaded in Nigeria up to its destination. This technology is expected to significantly curb oil theft and diversion,” Abbas said.
The Speaker, who was represented by his Deputy, Hon. Benjamin Kalu, expressed concerns about growing corruption in the oil and gas sector.
“Another nagging issue in the oil and gas sector which we must tackle is corruption. Sadly, corruption has inflicted serious damage to the national economy through cumulative loss of revenue over the years.
“Consequently, this public hearing will also focus attention on all expenses incurred by government agencies for the purpose of combating oil theft and other related matters in line with Sections 80, 88 and 89 of the 1999 Constitution of the Federal Republic of Nigeria as amended. It is also in line with our resolve in the House of Representatives to entrench transparency and accountability in the governance process.
“We are therefore committed to providing comprehensive coverage for investigative hearings on anti-corruption issues and follow through with implementation of Committee recommendations through the power of the purse, oversight functions and law making.
“We are also determined to strengthen the Economic and Financial Crimes Commission (EFCC), the Nigeria Extractive Industries Transparency Initiative (NEITI) and other anti-corruption agencies to frontally combat corruption in the oil and gas sector”.
The SGF who was represented by the Permanent Secretary, General Services, Maurice Nnamdi Mbaeri said that the country has consistently failed to meet its production quota set by OPEC which has not only affected its revenue, but hampers the provision of social services that Nigerians rely on.
Akume who was represented by the Permanent Secretary, General Services, Maurice Nnamdi Mbaeri even though the country is blessed with abundant natural resources, particularly crude oil, it has faced persistent challenges in harnessing these resources for the collective prosperity of our people.
He describe oil theft as a malignant scourge which has continues to undermine nation’s national economy, compromise security, and erode the trust of both local and international stakeholders.
He said “the magnitude of oil theft in Nigeria is staggering. In recent years, Nigeria has faced an alarming rise in crude oil theft, resulting in substantial losses that have devastating implications for our economy and national security. The statistics are staggering. For example, the Nigeria Extractive Industries Transparency Initiative (NEITI) 2020 Oil and Gas Report indicates that 619 million barrels of crude valued at $46 billion were stolen in the period 20092020.
“Therefore, Nigeria has continually failed to meet its daily production quota as set by the Organisation of the Petroleum Exporting Countries (OPEC). This not only undermines our revenues but also hampers the provision of essential services that millions of Nigerians rely upon”.
The SGF said the government has invested considerable resources in combating this menace. Since 2020, expenditure aimed at addressing crude oil theft and securing our oil infrastructure has exceeded $1.5 billion USD which has been allocated towards enhancing surveillance capabilities, securing pipelines, and increasing the presence of law enforcement agencies in critical oil-producing areas.
He said the investigative hearing marks a pivotal step in our concerted efforts to confront this issue head-on, adding that it is a demonstration of Government’s unwavering commitment to transparency, accountability, and the rule of law.
He disclosed that the government was implementing a multi-faceted approach that encompasses robust legislation, enhanced security measures, and community engagement, which will expectedly strengthen our legal framework to ensure that those who engage in oil theft and related offenses face the full weight of the law.
Former Deputy Speaker of the House, Hon. Ahmed Idris Wase said the work of the committee was a dangerous one as it will bring them face to face with people involved in sabotaging the nation’s economy.
Wase said “oil theft has brought Nigeria down and has caused us major international embarrassment. We have heard from the SGF how much the government is spending in trying to curb oil theft and we have not gotten the result because we are not yet there.
We have been told here by the SGF the amount of money and total money is $1.5 billion. That is not a small amount of money, but I hope it will be resolved. And I want to say that the best we can do for ourselves is to encourage us. You are involved in and doing a business that is very dangerous. It is more than dangerous. Don’t take it lightly.
“It is not going to be easy for you and easy for the committee members because you are going to face people who are sabotaging the Nigeria’s economy and In other climes, they are supposed to be in the gallows.
“I can say, as a former Presiding Officer, the information I brought with me that I saw is huge. I remember a day when I was presiding and I was dealing with a motion brought by some of our colleagues on a yacht that was destroyed by Nigerian Navy. It was among those who were trying to sabotage Nigeria’s economy.
“But now we have a motion to bring it to the parliament to ask for investigation, to ask for prosecution. At the end of the day, I said to our colleagues that, as far as I’m concerned, this is a dangerous trend that we are following. And then a person was watching me on television and he now had to send words to me that I’m not a good person”.
Chairman of the Committee and former House Leadr, Hon. Alhassan Ado Doguwa the ultimate aim is to employ every legislative tool to unearth the root causes and immediate factors contributing to this crime, bring those complicit to justice, and develop sustainable solutions that will safeguard the integrity of our oil sector And promote national development.
Doguwa said the committee has noted several critical issues, including vessels transporting stolen crude oil undetected, collaboration among government and security agencies in illicit activities and the inefficiencies of current measures to combat oil theft.
He said the NNPC Ltd. has reported 900 infractions on its pipelines, and delayed judicial processes have resulted in the abandonment of cases, allowing culprits to return to their criminal activities, stressing that the presence of high-powered illegal infrastructure for exploring and refining crude oil has significantly reduced production to 1,300,000 Bpd from 2,500,000 Bpd.
He maintained discussions with stakeholders have revealed that oil theft is not only a significant revenue loss for the country but also a threat to National Security and regional stability and categorized oil theft is categorized into on-shore losses, involving sabotage of pipelines and installations for local markets, and off-shore losses, perpetrated by organized criminal syndicates for international buyers.
He stressed that addressing this issue requires a multifaceted approach, including effective prosecution and punishment of perpetrators, better synergy among security agencies, maritime safety review, financial responsibility, and deployment of advanced technology. International collaboration is also essential to complement our efforts.
Doguwa recommended that rather than burn illegal refineries and vessels discovered by security agents, the government should find a way of putting them into productive use, adding that combating crude oil theft will no doubt increase oil production and revenue.
Buba explained that in battling the perpetrators of crude oil theft, the security services have established a unified command structure for security operation in the Niger Delta region.
“Additionally, we are examining other areas such as: transparency of international oil companies (IOCs), credible metering of oil wells and the tracking of point of loading to destination of the crude oil.
“We are also galvanising the support of host communities as well as stakeholders in the oil sector. Troops are also reinforcing surveillance efforts on vessels, terminals and oil infrastructures to include jackets that house well heads.
“Most importantly, troops are monitoring to ensure that culprits are prosecuted by the prosecuting agencies. It is believed that with these measures implemented, there would be a significant boost in crude oil output for the nation.”
Speaking about military operations in the Niger Delta in the past week, the defence spokesperson said troops seized 802,200 litres of stolen crude oil, 121,900 litres of illegally refined diesel and 450 litres of kerosene.
Buba said troops also arrested 32 oil thieves and destroyed 36 illegal refining sites, 20 dugout pits, 24 boats and 34 storage tanks.
He said troops recovered 56 cooking ovens, two speedboats, 14 pumping machines, 18 drums, 22 vehicles, and four motorcycles, among other items during operations in the oil-rich region in the past week.
Speaking on operations in other parts of the country in the past week, the defence spokesperson said troops killed 106 terrorists, arrested 164 criminals, and recused 103 kidnap victims.
He said troops would continue to hunt down terrorist leaders, commanders, foot soldiers and their collaborators in the battlefield.
“Many of these categories of terrorists have been eliminated from the battlefield and we are after the others,” Buba said.
