In this interview, an industrial relations practitioner, former President of Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, and former Deputy President-General of Trade Union Congress of Nigeria, TUC, Dr. Brown Ogbeifun, spoke to Sweet crude on the alarming rate of crude oil theft, pipeline vandalism, planned privatization of the four public refineries, and the protracted Petroleum Industry Bill, PIB.
What is your impression on the state of oil industry in Nigeria as at today?
The state of the industry as today, specifically in 2013, is a mixed grill of gains and losses. The refineries’ capacity utilization was enhanced though still not where they should be and this meant that Nigerians were able to fuel their cars without tears for another whole year. On the other side of the coin are the sad issues of massive vandalism of petroleum products pipelines, crude oil theft and further divestments by some of the Oil Majors. Overall, as a nation, we should have done better in the repositioning of Nigeria’s Oil and Gas sector that would have enabled it take the central role of being the central focus in global oil and gas affairs.
What is your take on the unabated theft of the nation’s crude and pipeline vandalism that you spoke about?
Vandalism and crude oil theft are whirlwinds that shall do no good to the nation. I do not know of any other nation, where vandalism of petroleum products’ pipelines in order to steal crude is as rampant as we have in Nigeria. Figures ranging from 200,000 to 350,000 have been touted as daily crude oil stolen from the lines between 2010 and 2013. Apart from other leakages, this is a very serious economic hemorrhaging condition that should be stopped by all means.
What analysts usually focus on in calculating the losses is the amount of crude stolen without putting into consideration the cost of cleaning the spills and fixing the pipelines by the companies. What of the damage to our national image and the untoward effect of discouraging foreign investments? This is an incalculable damage that cannot be accounted for in naira and kobo. But it seems security agencies are finding it tough to deal with because of the enlarged circle of the powerful cabals and conspirators.
The international community, financial institutions within and outside Nigeria, possible connivance of some security operatives and Nigerians are also culpable because we seem to be looking the other way while these nefarious activities take place. The vandals operate in communities inhabited by Nigerians and the barges used are not submarines that cannot be detected or match boxes that can be stuffed in the pocket.
The illegal refineries use crude as its feedstock and such refineries are within communities in the Niger Delta. The products are sold in towns and villages in this country. The unused crude finds its way to the international market and paid for in dollars. The cabals do not have underwater banking institutions where these proceeds are kept. They use conventional banks within and outside Nigeria.
The negative impacts of vandalism and crude oil theft include the destruction of aquatic and farmlands, economic sabotage which explains the shortfall of Nigeria’s 2014 budget from $29.3 billion in 2013 to $23.3 billion in 2014 and divestments by some International Oil Companies, IOCs, with attendant job losses thereby compounding the unemployment situation in Nigeria. Compounding the situation is the security challenges facing us as a people. Under these circumstances, apart from corrupt investors, no transparent investor will be ready to make any meaningful investments in this critical sector.
The effects of vandalism and crude theft are so colossal that no nation can progress with such a negative societal value. It is for this reasons that the United States of America (USA) called on the Federal Government of Nigeria to do everything possible to address the issue of large-scale oil theft in the Niger Delta, and the House of representatives has also set up a 17 man committee to look into the same issue. So, what is the way forward?
The international community should stop playing the ostrich by blaming us for corruption and at the other end accepting to keep proceeds of corruption in their vaults. They should adopt a don’t see and don’t touch stolen crude oil from Nigeria approach and seriously sanction or blacklist any marketer found guilty of trading in stolen crude oil. Once there are no buyers, illegal bunkering shall become less attractive and at the end gradually fizzle out.
As citizens, the communities where these illicit activities take place should report all clandestine and illegal bunkering activities to security agencies because they suffer or shall suffer the negative impacts of the nefarious activities of these vandals. Their environments are being destroyed with reckless abandon while the illegal bunkers smile to the banks with their loots in foreign currencies.
The community farmlands and water are destroyed and some of the crude ways of managing the stolen crude by the vandals have severe health consequences for this and the next generation. So, it is in the interest of the communities to assist government in eradicating the menace of vandalism and crude theft.
Our security agencies must up their strides against these criminals and consistently work to identify and flush out the enemies within that may be sabotaging their efforts. They seem to be the last hope of this rescue mission because we as helpless civilians cannot confront these menacing vandals with our bare hands. Failure to do this may lead to a collapse of the entire oil and Gas Sector with not enough money to service salaries and other critical sectors.
Tackling them with kids’ gloves may lead to a more fairy and deadlier wars as drug war rages in some parts of Latin America. We may think it is impossible. But when one looks at the body languages of the Governors who come to Abuja for monthly FAAC rituals, one can say that continued puncturing of our economic jugular by vandals and stealing the crude meant for the development of the country portends serious danger for Nigeria.