January 30, 2019

Oil Theft: FG begins tracking of crude output, vessels operating in Nigeria

vessels, Nigeria

* Mor Prosperity; one of the two newly acquired vessels by Morlap Shipping Company.

By Michael Eboh & Ediri Ejoh

Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, said the Federal Government has commenced the tracking of Nigeria’s crude oil output and is currently working with the Economic and Financial Crimes Commission, EFCC, to track vessels lifting crude oil from the country.


Speaking at the ongoing Nigeria International Petroleum Summit, NIPS, in Abuja, Kachikwu disclosed that the Federal Government has acquired the capacity to monitor vessels operating in Nigeria and through its monitoring of these vessels, it had observed irregularities in the movement of some of the vessels mandated to lift crude oil from Nigeria.

He said the data observed from the activities from the movement of vessels would help determine the various loading points of the vessels, the dead weight of the vessels and the volume of crude oil lifted from the country by the vessels.

He added that the tracking programme would be extended to the downstream sector, to determine the volume of Premium Motor Spirit, PMS, also known as petrol, imported into the country; the quantity of the products brought in by each vessels; the depots the commodity are stored, up to the points of retail to motorists.

“For the first time, we know what we are producing in this country. As to when it is being produced, barrel to barrel, we can tell. We can see even vessels that are coming into Nigeria and their activities. We have seen some vessels go to a location and pick some cargoes, leave that point, go to another point pick something else and return to the first location, when they should be heading to Port Novo or the United States.

“What we are trying to do with the EFCC is to gather data and track these vessels, to determine the owners, why did they leave this point, what happened along the way, what is the dead weight of the vessels at the time they were leaving Nigeria and many more.

“So for the first time, we are going to soon be able to tell on a day-by-day basis all the activities that took place in the sector and those of the players. We are even going to extend it to the downstream.”

Petroleum industry doesn’t lack policies, but implementation

In another session, the panelists made of experts and a member of the legislature, identified lack of implementation of key policies and lack of transparency among others, as issues hindering investment and development of the oil and gas industry.

A member of the panelist, Mr. Sergius Ogun, Member of the Federal House of representatives, Representing Esan North East/South East Federal Constituency of Edo State, lamented the huge interference of government in the petroleum industry.

According to him, the petroleum industry does not lack policies, but was limited in implementation, adding that government hold in the sector was too great and is worrisome.

He said, “We tend to politicise everything in the country, which is very much affecting the major sector that should drive the economy. For example, why is the downstream still not deregulated or NNPC still a cash cow for government, why is there interference and game? It makes no sense for the industry and our economy. Government should hands off the business and focus on regulation.”

On his part, Director of the Department of Petroleum Resources, DPR, Mr. Mordecai Ladan, added that the petroleum sector lacks synergy between policy development and implementation.

Ladan, who was represented by his Technical Assistant, Mr. Nuhu Habib, said, “I strongly believe that transparency and accountability of doing business is a critical issue needed to be addressed for the industry to move forward. Why is this? We must set a clear differential between what should be business and policies. Government must be very proactive in ensuring it operates also as a business entity and not just as a regulator.

“Also, there must be a collaboration between the government and operators. Though, steps are already in place and more stakeholders are been consulted for some policies, but more is needed to be in place if we must scale through.”

While arguing what should be a priority in the industry, Soji Awogbade, Principal Partner, AELEX, hinged on adequate government structures to drive the sector.

He said, “I will say that until we have a good government structures in place, timely delivery on responses to operators on projects, there is still no light at the end of the tunnel for the industry.

“The invisible barriers of how to do business in Nigeria has to be addressed. We cannot have people chasing regulators to do their job or paperwork. The petroleum industry is done writing policies and laws, without addressing the key issues confronting it.”