Succour as DPR Introduces Crude Oil Tracker

Oil theft, opaqueness of the Nigerian oil industry may be a thing of the past if indications that the Federal Government has started the process of tracking the country’s oil output, are anything to go by.

–By Gideon Osaka

Early this month, Ibe Kachikwu, Minister of State, Petroleum Resources, commended the Department of Petroleum Resources, DPR, on its newly computerized crude oil and LNG tracking, automatic downstream system, and other automation initiatives. Kachikwu gave the commendation during a Ministerial briefing on the achievement of the Agency and inauguration of the automated software in Lagos. He said: “The clear mandate as a Minister of State, is to try and change the oil industry, because we were deeply worried about what was looking like a value dip in terms of the reputation of the oil industry and some of the issues of corruption that were all over the place. “Whilst we are celebrating a whole lot of things that we have done, the 7-Big Wins, NNPC restructuring, the cash call issues, subsidy removal at some points, the reality is that DPR has been a regulator that has been working very hard and when they eventually got to the milestone that we have today, I said to them, let the people come out and know what they have been doing over the last couple of years. “One of the key areas of focus was issue of transparency; how do we ensure that we are transparent in our operations, how do we ensure that we have speed to get approval for licences that previously will take forever. “How do we ensure that every monies that is collected in this sector is tracked and goes straight into the federation account? One of the problems we have is that what quantity of crude we produce, how much are the leakages?

“We have rolled around this for decades and I told them I want us to be able to tell Nigerians everyday what we produce with some certainties.” He said that today, the Agency has been able to track production, track the movement of that production, following these initiatives had launched series of IT based platforms and interventions which will lead Nigerians into the next foray of how oil companies and oil operations in this country should run.”

He said 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 vessel; the depots where the commodity is stored, up to the points of retail to motorists. Kachukwu stated: “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?” Nigeria has for a long time been associated with lack of accuracy on the actual volume of crude it produces every day. The public has often been confronted with different figures as what is generated by the DPR, which most times are at variance with what is being generated by the Nigerian National Petroleum Corporation (NNPC) and the oil companies operating in the country.

The discrepancies have been most pronounced in subsidy payments and remittance to the Federation Account as stipulated in Section 162(1) of the Constitution. The fuel tracking device is expected to show accurate figures of fuel consumption. For instance, there is a huge discrepancy between the figures by the independent oil marketers and those from the Nigerian National Petroleum Corporation (NNPC). While the NNPC claims that daily petrol consumption in the country is between 60 million and 70 million litres, private oil marketers say it is between 30 million and 40 million litres.

The Minister appears to be optimistic that when the technology-driven tracking system comes into operation, every truck conveying fuel in any part of the country will be licensed with a driver and transport company. This is with a view to finding the transporter and holding the company liable for any missing truck. The NNPC and two of its subsidiary companies, the Department of Petroleum Resources (DPR) and the Petroleum Products Pricing and Regulatory Agency (PPPRA), are expected to collaborate in order to achieve the objective.

He said, “Considering the hefty amount government often pays as subsidies, especially during periods of fuel scarcity, the fuel tracking technology should be given a chance. It is heartening that President Muhammadu Buhari has approved the plan to track the movement of refined petroleum products from the trucks till the products are discharged into the storage tanks for the filling stations. Nigerians expect positive results from the plan. Anything less will amount to a wasteful expenditure. We also expect that the tracking will help keep proper data repository of fuel consumption in the country.”