BY: IFEANYI IZEZE<\/p>\n
Godwin Obaseki, the Governor of Edo State, who is also the Chairman of
\nthe Ad-hoc Committee of the National Economic Council on Crude Oil
\nTheft, Prevention and Control, revisited the menace of crude oil theft
\nin the country by painting a dire picture of the problem when he
\nrecently in Abuja stated that in the first six months of 2019, the
\nnation lost about 22 million barrels of its produced crude oil to oil
\ntheft. He said \u201cif nothing was done to curtail the ugly trend, the
\nfigure could double by the end of the year.\u201d<\/p>\n
Those who know would agree that the 22 million barrels loss in six
\nmonths posited by NNPC and the Edo state governor was a very
\nconservative estimate as the menace is far worse than that.<\/p>\n
Nigeria\u2019s current official production figure is somewhere between 1.7
\nand 1.85 million barrels per day while it has confirmed capacity to
\ncomfortably produce over 2.5 million bpd. This gap is one of the areas
\nto keenly watch if we are serious about solving this problem of crude
\noil stealing. Are the multinationals producing more than what they tell
\nus since the capacity to go beyond the figure they usually dangle at us
\nexists in the various oilfields owned\/operated by these companies?<\/p>\n
Let nobody come with the trash of \u201cdoes the Department of Petroleum
\nResources (DPR) not supervise production and loading activities of the
\nforeign operators\u201d because I have a working knowledge of how the
\nsupposed supervision is done.<\/p>\n
With over 90 percent of the stolen oil exported and the balance of less
\nthan 10 percent allegedly processed locally at the artisanal refineries
\nspread across the Niger Delta region, the federal government should know
\nfor certain where this problem lies. Whether anybody wants to hear this
\nor not, the pockets of persons arrested from those \u201ckpofire\u201d
\nlocations in the Niger Delta have only token-effect in combating the
\nscourge. Their own nuisance\u00a0 is more in causing environmental
\ndevastation some of which may be irreversible.<\/p>\n
It has been established that less that 2 percent of the produced crude
\noil stolen from facilities in the Niger Delta are taken from flowlines
\nbetween wellheads and the flowstations. Then between the flowstations
\nand the export terminals, about 8 percent or less is sucked by thieves.
\nSo could this be where the problem lies?<\/p>\n
It should actually bother our government that no two agencies in the
\nmanagement of the nation\u2019s oil business have the same figures on our
\noil production. Should it be so? Various audit reports have shown that
\nthere are often conflicting data submitted by the different stakeholders
\ninvolved in the core areas in the oil industry \u2013 like in the
\nproduction, lifting and refinery deliveries. Some people would say we
\nproduce 1.8 million barrels per day, some other will say we do 1.9 while
\nanother set would give you 2.2 mbpd as our output. These are prime areas
\nwhere a lot of manipulations take place to deliberately short-change
\nNigeria in the sharing of produced joint venture crude.<\/p>\n
For whatever reasons by both the NNPC and its joint venture partners,
\nproduced crude oil is not measured at the wellheads or flowstations but
\nonly at the export terminals. And this is where the bigger problem lies.<\/p>\n
There are footprints everywhere to show that the foreign multinational
\noil companies are defrauding Nigeria in their handling of crude oil
\nproduced within our oilfields. The cases filed against the Nigerian
\nsubsidiaries of U.S. multinational oil corporations including Chevron,
\nthe Anglo-Dutch concern, Shell, Italian ENI\u2019s Nigerian Agip,
\nFrance\u2019s Total and Brasoil of Brazilian Petrobas are just sample
\nprototypes of what these companies are doing to deny Nigeria of its
\nsupposed earnings from oil produced in the country.<\/p>\n
As said in the documents tendered at the High Court in Lagos, \u201csome
\nshiploads registered less when they left Nigeria and more on reaching
\nthe United States, while some entire shiploads were undeclared in
\nNigeria.\u201d The U.S.-based ImportGenius database was used by attorneys
\nto confirm declarations made to U.S. customs by shippers and importers.<\/p>\n
Now, following series of investigations undertaken by this consortium,
\nit was established as suspected, that the crude oil declared to have
\nbeen exported from Nigeria between January 2011 and December 2014, was
\nless than what was declared to have been imported into the United States
\nof America, a country that maintains detailed records and has stricter
\ncompliance measures.<\/p>\n
Most times, what oil tankers declare they load at Nigerian ports is far
\nlower than what the vessels discharge on arrival at ports in the USA.
\nThese were facts established by the Nigerian government-commissioned
\nteam of experts. And as explained by the federal government\u2019s legal
\nteam in its deputations, the significant crude oil theft for which due
\npayment is being sought by the nation, takes the form of accounting
\nfraud, non-declaration or under-declaration of crude and gas cargoes.<\/p>\n
Just imagine what this country would have lost over the years to these
\ndubious business practices of the foreign multinational oil operators
\nwho come from countries that lecture us every day on integrity and
\ntransparency in business transactions?<\/p>\n
Tragically, as has become the manner of our judges and their courts, the
\ncase was deliberately dismissed for want of evidence. What other
\nevidence does the High want apart from the available ones that showed
\nthat some cargoes that landed in the USA were not even declared in
\nNigeria at all while some had far more volume discharged at the
\ndestination than was said to have been loaded at our export terminals?<\/p>\n
On several posits on the menace of crude oil theft in the Niger Delta,
\nthis writer had insisted that if the magnitude of crude oil stealing as
\nreported were to be true, then there couldn\u2019t have been anyway such
\nfleecing could occur without the collusion and\/or participation of some
\nmajor producers in the country and international oil tankers that lift
\nNigeria\u2019s crude on behalf of the IOCs and the NNPC.<\/p>\n
All these years, these same oil companies have blamed Niger Delta oil
\nthieves for the spate of pipeline breaches and crude oil theft in the
\nregion when in actual fact the companies may have been covertly
\nencouraging the \u201clocal thieves\u201d to take some oil so that the
\ncompanies can hide under that to siphon as much volume of crude as they
\ncan to their various countries\/markets.<\/p>\n
Most Nigerians particularly the government people may not be aware that
\nthe nation\u2019s offshore arena is littered with tens of mega
\nfloating-production and storage platforms bleeding some of the
\nnation\u2019s most prolific wells and fields and yet these facilities are
\neither poorly monitored or even unmonitored at all. Don\u2019t ask me how I
\nknow because I worked in some of those facilities as a geologist and
\nenvironmental auditor.<\/p>\n
Let\u2019s even look at recent pronouncements by Shell, Chevron, and Agip
\non magnitude of loss each suffers everyday: The problem of crude oil
\ntapping by thieves, as we were told, is localised on facilities on land
\nand swamp areas. It is a near impossibility to steal crude oil from
\neither wellheads or flowlines in offshore arena without being spotted
\nright on arrival.<\/p>\n
Chevron in Delta is majorly an offshore producer (near shore and deep
\noffshore). So majority of the company\u2019s loses to thieves and vandals
\ntake place of the Chanoni Creek flowlines. Shell and Agip\u2019s loses due
\nto tapping from their facilities occur onshore- land and swamp terrains.<\/p>\n
Question: what is the daily average of Shell and Agip\u2019s combined
\nonshore production that thieves can suck away over 300, 000 barrels
\nevery day as recently declared by the NNPC and some top officials of
\nthese foreign operating companies?<\/p>\n
To say that NNPC as the outstretched arm of the federal government in
\nthe nation\u2019s oil business is thus far a big disgrace is an
\nunderstatement whether they want to hear it or not. The nation\u2019s apex
\noil concern carries on its business as if they represent the interest of
\nthe foreign operators more than the interest of Nigeria.<\/p>\n
The Department of Petroleum Resources, the handicapped police, is even
\nworse than the NNPC though theirs seemed to be deliberately caused by
\npeople in government to ensure the department is permanently disabled.<\/p>\n
My take is that whatever new effort against oil theft planned by the
\nfederal government will require the maximum co-operation of the
\ninternational community, especially countries like the Netherlands,
\nItaly, USA, China, Spain etc which are major stakeholders in the global
\noil industry and some of the destinations for oil stolen from Nigeria.
\nAnything short of that is merely dancing around the problem. God bless
\nNigeria!<\/p>\n