• Local producers call for govt action

By Prince Okafor

There are indications that  oil theft may be escalating as a result of sharp rises in price at the international market. Consequently, indigenous oil producers have called on the Federal Government to urgently tackle the menace of oil theft in the Niger Delta, which is impacting negatively on their operations.  

According to the producers their investments and the progress recorded over the years in Nigeria’s upstream oil sector, are gradually being eroded by oil theft syndrome.

An executive in one of the indigenous oil firms who said, “People are making petrodollars on the high seas, while we are experiencing fall in production volumes”.  

The price of the international benchmark, Brent Crude, for a better part of 2021 and this year has been above $70 per barrel mark, jumping 7-year high to over $100 per barrel last week.

Nigeria’s Bonny Light, a favourite of refineries,    and the country’s other blends are also selling within that range.

“The thieves are cashing in on rocking prices and there is a noticeable presence of barges and vessels in the creeks loading stolen oil from pipelines and transporting to large vessels on the high seas,” the producer said.

President of the Independent Petroleum Producers Group, the umbrella group for indigenous oil producers, Abdulrasaq Isa, stated: “The key challenges now are in the areas of security and high operating costs. We look forward to the government in finding long-lasting and sustainable solutions to these challenges.”

READ ALSO: Why Nigeria can’t meet OPEC’s 1.8mb/d oil production quota ― FG

Industry sources explained to our reporter that usually, crude theft is highest just after the flowstation, as this is after primary treatment and so the flow is at a higher quality, easier to handle by the crude refiners.

According to the industry sources, the oil thieves target the ENI-operated pipeline to Brass terminal as well as the AITEO Nembe Creek Trunkline, Chevron’s Escravos and the TransForcados pipeline.

Illustrating the crime pyramid in the Niger Delta, a source in the industry said, “It’s not the boys in the creeks that are at the helm. Those boys cannot arrange the complex logistics, including trans-shipments to mother ships offshore and eventual export of the stolen crude. Obviously, some highly influential persons are involved.”  

According to the immediate past Director General / CEO of Nigerian Maritime Administration and Safety Agency (NIMASA), Dakuku Peterside, “It is estimated that 80 per cent of the stolen oil is exported, while the balance of 20 per cent goes into illegal refining in “refineries” dotting the landscape of the Niger Delta creeks.”

He said: “The vessels and the illegal refineries are very conspicuous and visible to be noticed, yet these illegal operations have been going on without any significant challenge from Government or governmental institutions including security agencies.”