Nigeria Loses $3.72million daily as oil theft drops to 60,000bpd

Nigeria is currectly losing $3.72million, about N632.4million daily as the federal Government yesterday said, cruide oil theft had dropped to about 60,000barrels per day from a high about 200,000bpd. 

Speaking in an interview with CNBC Africa, Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, said the decline was due to efforts by security agencies and other government agencies in reducing the menace of crude oil theft.

She said: “Security agencies, along with other government agencies, have gone a long way towards reducing the actual incidence of theft. We went to an all-time high of 200,000bpd or perhaps even more to what is currently estimated to be something in the region of 60,000bpd. So we have dropped.”

Crude oil price rose to $62 a barrel, yesterday, close to its 2015 high. Brent crude rose 60 cents to $62.00 a barrel midday on account of the crisis between North African countries, Egypt and Libya as well as supply threats from Iraq and Baghdad.

Therefore, using the current crude oil price, the inability of the country to export the stolen 60,000 bpd translates to a loss of $3.72 million, about N632.4 million
per day in Nigeria’s crude oil earnings. If not addressed on time, this will translate to a loss of N4.43 billion in one week or N18.97 billion in one month.

FG laments rising incidence of vandalism

Alison-Madueke, however, stated that despite the major decline in crude theft, the country is currently recording an unprecedented incident of vandalism of gas pipelines.

She disclosed that the rising incidence of vandalism is an act of sabotage and terrorism, and blamed enemies of the country for sponsoring the sabotage.

She said: “While we were dropping in terms of oil theft, unfortunately, we are going up incredibly in the issue of vandalism and sabotage, which again is a major mystery to us, as to why anybody would want to come in, vandalise our crude and by the way, gas pipelines, not for the sake of stealing, but just to disrupt production.”

“This is not oil theft, this is just to disrupt production, because you cannot burst a gas pipeline with the intent to gather gas, you can’t gather the gas in drums or in basket. It is clearly an act of sabotage.

“Once that happens, it means we have to shut in major tranches of pipeline to fix them over a number of weeks. What happens then is what we call shut-in or deferred production, either with the crude or with gas.

“Again, the production volume drops drastically for that period of time until that tranche is reopened. We have seen a major surge in this sabotage, which I actually liken to terrorism, because they come at it in all kinds of remote locations.”