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Reasons FG can’t tame oil thieves

The latest outburst by the Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, that oil theft was still a major concern for Nigeria has left many Nigerians bewildered and disappointed that the menace they had thought was a thing of the past still remains a monster that lives with us.

Oil theft often occasioned by pipeline vandalism has continued unabated in the last 10 to 15 years with successive governments failing to. address to scourge which denies the country huge revenue loses. The Nigerian National Petroleum Corporation (NNPC), recently said it spent over $150 million trying to revamp the Escravos-Warri crude pipeline before eventually resorting to moving crude by marine vessels.

Similarly, a recent report by the Nigeria Natural Resource Charter (NNRC) on crude oil theft in the country revealed a loss of N2.6 trillion between 2016 and 2017. NNRC is a United Kingdom-based Non-Governmental Organisation (NGO) which provides policy options to guide governments and societies in a bid to manage their natural resources for development.

When the current administration came on board, part of its cardinal objectives was to address the menace by reducing oil theft and pipeline vandalism to its lowest ebb.

The move was kick-started by Vice President Yemi Osinbajo, when he commenced a tour of the Niger Delta region, engaging youths and community leaders on the need to sheath their swords and embrace dialogue.

At that time, the country’s oil production fell from about 1.8 million barrels per day (bpd) to an all time low of 800,000 barrels with many International Oil Companies being the worst hit while Government revenue equally nose-dived. The dialogue embarked by Osinbajo translated to some gains as the country have witnessed some measure of respite from the activities of the Niger Delta agitators appears to have simmered and embraced peace.

But this seeming peace may not have been 100 percent as Kachikwu recently declared ‘‘ crude oil theft is still there and there was no point pretending about it but significant efforts and progress have been recorded,’’ he said.

The NNRC survey report

According to the NNRC report entitled: ‘Oil theft in Nigeria,’ oil theft has assumed a spiraling and disturbing dimension, costing the economy huge losses, bigger than federal allocations for education and health sectors combined. For the two years (2016-2017) covered by the report, the combined allocations for health and education in the 2018 budget amount to 8.4 per cent or N189 billion of the estimated value of losses from crude oil theft.

More disturbing in the report is the allegation that oil thieves bribe security officials deployed to curb oil theft in the Niger Delta region. Currently, Nigeria is the country most plagued by oil theft in the world. It is followed by Mexico, Russia and Iran. The amount lost to crude oil theft in 2016 was reported to be more than the revenue target attained by the Federal Inland Revenue Service (FIRS) in 2017.

Also, the Chatham House, a policy Think Tank group based in the UK, said massive oil theft by pirates costs Nigeria $1.5 billion every month. The figure which was confirmed by Osinbajo, is equal to the total daily export capacity of the Forcados terminal. The economic outlook is still fragile with fluctuations in global oil prices and rising national debt, checking the menace of oil theft should, therefore, be a national priority. Although oil theft has remained a recurring problem over the years, reports that the incident has continued in spite of security deployment to curb it, means the economy is at risk, and therefore new strategies are required to contain it.

Also, a report by the Shell Petroleum Development Company (SPDC) showed that crude oil theft rose to 50 per cent in 2017. The NNPC monthly financial operational report for November 2016 disclosed that out of its total earnings from domestic crude oil and gas sales, N11.78 billion was spent on pipeline repairs and management compared to N12.34 billion in October 2017. The corporation said it lost N127 billion to crude oil theft and infractions in 2016.

Why oil theft persists

NNRC in its report identified poverty, unemployment, poor governance, pervasive corruption, sabotage, pipeline vandalism and the neglect of the Niger Delta region as major causes for the emergence and sustenance of crude oil theft. The report also said it found a connection between politics and crude oil theft and noted that local politicians engage in oil theft to get money to fund elections.

For his part,Delta State Deputy Governor, Mr. Kingsley Otuaro, also reechoed NNRC stance, saying the spate of unemployment among youths is largely responsible for the growing crude oil theft and vandalism of gas installations in the Niger Delta region.

Otuaro disclosed this during the media conference of the  Delta State Advocacy Committee Against Oil and Gas Facilities at Government House Annexe in Warri.

The two-day event with the theme: “Sustaining Peace Building Potentials and Surveillance of Oil and Gas Assets Through Community Engagement” was premised to address the issues of vandalism of oil and gas installation, and illegal bunkering in the Niger Delta  region.

Otuaro at the media chat in Warri, stressed that lack of employment was the major reason most youths indulged in crude oil theft and pipeline vandalism in state.

He added that the state government was doing the needful through programmes centred on the provision of basic skill acquisition for youths.

“The act of criminality against crude oil installations is caused due to unemployment rate in the state, but the state government has been creating skill programme, in line with the SMART agenda of the state.

Also, a former Commander, Nigerian Navy Ship Delta, Aliyu Sule, recently identified impunity and slow pace of adjudication as factors responsible for the persistence of illegal bunkering in the Niger Delta region.

He said the process of trial of arrested suspects for oil theft was slow and encouraged the perpetrators to easily go back into the illicit act.

He said the cases of more than five ships apprehended by his command over stolen oil since 2005 were yet to be resolved in courts.

“It takes a longer time for justice to be done in matters of oil theft that is why the illicit business persists. So suspects should be tried almost immediately and jailed,’’ he said. He stressed the need for effective surveillance and speedy trial of oil thieves, saying these were germane in eradicating illegal bunkering in the region.

Sule disclosed that his command had adopted a constant and effective surveillance of the hinterland from both land and air with a view to adequately comb the terrains.

Stakeholders fault pipeline surveillance deals

Youths from Ijaw, Isoko, Itsekiri, and Urhobo ethnic tribes of Delta State last November, blocked the gate of the Delta State government house protesting the alleged hijack of the Trans-Forcados Pipeline (TFP) oil surveillance contract by the management of Ocean Marine Solutions Limited.

The protesting youths, who trooped out in their hundreds, also alleged that the hijack was done in connivance with some ‘forces’ at the presidency.

Lord Oriunu, who spoke on behalf of the protesters, accused the Group Managing Director of Nigeria National Petroleum Corporation (NNPC), Maikanti Baru, of allegedly conniving with Ocean Marine to hijack the surveillance contract for Trans-Forcados Pipeline.

He alleged that OMS had been awarded other surveillance contracts in the Niger Delta region, which he claimed were not performing, adding that production had been seamless without any incident of oil theft while the surveillance contract for TFP was under the watch of locals.

The protest leader aslo alleged that the Baru/Okunbor alliance is currently posing an economic danger to Delta State, noting that discontent has started manifesting in the communities as well as the division between traditional authorities and community leadership.

OMS reacts

But Ocean Marine Solutions Limited (OMS) in a swift response  urged the Federal Government to probe mismanagement of the Trans Forcados Pipeline (TFP).

The oil firm also accused Shoreline Natural Resources and Eraskorp of orchestrating a smear and defamatory campaign against its operations.

OMS, which is a leading asset company dedicated to protecting the country’s resources from graft and illegal activities, said those charged with TFP surveillance are afraid it will “put an end to their illegal racketeering in the petroleum industry because the Nigerian National Petroleum Corporation (NNPC) invited it to take over responsibility for its security.”

The oil firm also called on the federal government to investigate the alleged “calamitous mismanagement” of TFP and prosecute those responsible for the campaign of calumny.

It said the smear campaign is aimed at harming its operations and preserve the status quo, adding that “the investigation has become imperative in the light of the smear campaign against it by companies saddled with the surveillance of the TFP.”