Group Chief Executive Officer of Oando Plc, Wale Tinubu, has said 20% of oil production is lost to oil theft, reflecting Nigerian government’s inability to prevent sabotage on oil pipelines.
Tinubu explained that the oil theft was making it impossible for the country to reach its previous 1.4 million barrels per day quota handed to it by the Organisation of the Petroleum Exporting Countries (OPEC).
This means production level would fall short of the new 1.8 million quota the country received from OPEC, considering the challenges remain amid increase in expected oil output.
Nigeria is struggling to produce 1.21 million barrels per day in contrast to its 1.4 million barrels, Tinubu said on Wednesday at the 2022 Nigerian Oil and Gas (NOG) conference and exhibition.
He said this would eat into the oil industry’s contribution to the gross domestic product (GDP), reducing the value of the latter.
Ripples Nigeria had previously reported that the country lost $1 billion in the first quarter of 2022.
The Chief Executive Officer of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, had stated one month ago that only 71 per cent of oil produced in Nigeria get to the crude oil export terminals.
Tinubu advised that oil theft and pipeline vandalism needs to be tackled by the government and stakeholders through aerial and on-ground surveillance.
“There has been a 43% reduction in our production from March 2020 to May 2022. We lose almost 20% of our daily crude production to oil thieves and pipeline vandals and 20,000 barrels a day of oil is lost to oil theft.
“Basically some three million barrels on average yearly is lost to oil theft and pipeline vandalism”.
The oil businessman added, “The Organisation of the Petroleum Exporting Countries (OPEC) gave us a quota of 1.4 million barrels per day and we were struggling to do 1.21 million barrels per day.
“We will get to a quota of 1.8 million very soon because OPEC agreement expires in September. They are easing production by 400,000 barrels per day.” Tinubu said, adding, “We are not meeting the quota and we will not be able to meet it by that September”
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