Nigeria loses $150m daily to pipeline vandalism – NNPC reveals


Chief Financial Officer (CFO) of the Nigerian National Petroleum Corporation (NNPC) Limited Umar Ajiya revealed that Nigeria loses $150 million in revenue every day.

According to Ajiya, the pipeline vandalism and sideline production were factors behind the loss.

Ajiya said that 100 barrels of crude oil could be sent, but probably only 10 barrels would be received at the terminals.

He said the oil companies can no longer tolerate such theft levels, consequent upon which they declared force majeure, causing the Nigerian government revenue loss.

“At a point in this country, we had reached 2.3 to up to 2.7 million barrels per day just before the COVID-19 pandemic, but with the incessant vandalism and theft, our operators can no longer tolerate such theft levels that you send 100 barrels and you probably get 10 barrels at the terminals.

“So, as a consequence of that, some of them have declared force majeure and shut-in, so it is deferred production and consequently deferred revenue for us and the nation,” Ajiya stated.

In a related development, the NNPC has uncovered an illegal four-kilometer pipeline from Forcados in Delta state to the sea and a loading port that was part of an elaborate crude oil theft operation for the last nine years.

NNPCL Group Executive Officer Mele Kyari disclosed this on Wednesday while appearing before a joint Senate committee on Upstream, Downstream and Gas.

While admitting that oil theft in Nigeria had been on for over 22 years, he recent upsurge in recent time had been unprecedented.

The NNPCL boss also said three operational facilities of Forcados, Bonny and Brass oil terminals were shut down following the high rate of crude oil theft, leading to the loss of about 600,000 barrels per day (bpd).

He said: “In the last six weeks, there has been a spill site in Bodo community in Rivers State, which may affect the operations of Trans Niger pipeline if not clamped.

“Hundreds of illegal refineries in the country has led to the oil spill that made the country lose 120,000 bpd.”

Kyari said that in the course of the clampdown, the company destroyed 350 illegal refineries, 273 wooden and 374 reservoirs, in addition to 1,561 metal tanks destroyed with over 49 seized trucks burnt among others.

Kyari explained that the company carried out aerial surveillance of the affected areas which revealed the oil thieves carried out their activities unchallenged.