Nigeria lost a mind-blowing sum of N4.57 trillion to oil theft activities in the four years between 2015 and 2018, estimates of the Nigeria Natural Resource Charter (NNRC) has shown.
Put differently, the Federal Government lost about 43 per cent of its revenue to oil theft in four years.
Bunmi Olatunde, Deputy Director of Programmes at New Nigeria Foundation, who made revelation at a workshop titled Creating Innovative Technology for Artisanal Refineries in Lagos on Tuesday, admitted that oil theft and illegal oil bunkering practices were eroding government income generation potential acutely.
Just last October, Nigeria officially became the oil theft capital of the world when the NNRC released data, suggesting that the highest ever reported crude oil theft in the world took place in Nigeria.
The sobering statistics emphasised that Nigeria, as the most notorious country in the world for oil theft, lost roughly 400,000 barrels per day (bpd), dwarfing the figure (between 5,000 and 10,000 bpd) posted by Mexico, who came distant second by at least 3,900%.
By implication, more than one fourth of Nigeria’s average daily production (1.57 million bpd as of December 2019) is currently lost to oil theft.
According to the NNRC October 2019 study, revenue lost by the Federal Government between 2011 and 2014 ranged from $7 billion to $12 billion (between N2.545 trillion and N4.362 trillion) every year.
It is worthy of note that Nigeria’s budgets for 2011, 2012, 2013 and 2014 stood at N4.6 trillion, N4.8 trillion, N4.99 trillion and N4.962 trillion respectively.
One wonders why the Federal Government could choose to burden the citizenry with VAT increase and its negative consequences of rise in inflation and plunge in the value of Naira when it could easily cast its glance elsewhere by making diligent efforts to generate more income by curbing oil theft in order to fund its budget.
Beyond the outrageous revenue erosion that oil theft triggers, Mrs Olatunde also made mention of negative impacts such as environmental degradation, loss of livelihoods, loss of lives, violence and health hazards posed to the host communities.
Babajide Soyode, an engineering consultant with Dangote Refineries, who also spoke at the symposium pointed out that only the government had the capacity to make enduring social investment in the oil producing communities by holding the relevant agencies responsible for developing such communities accountable.
He said “how does Niger Delta Development Commission spend the money allocated to it? The agencies of the government should be held accountable. What alternative services can be provided for the youths in the Niger Delta region? The solution is not modular refinery.”
He went further to say that “crude oil theft has grown into a multibillion-dollar enterprise with a lot of actors at various levels. Therefore, no single approach can solve the problems. Interventions should be multifaceted at different levels.”
On its part, Alex Ogedengbe, Vice President Nigeria Academy of Engineering, affirmed that erecting artisanal refinery was not an answer to crude oil theft and illegal oil refining in the Nigeri Delta given that it constituted enormous hazards to the operators.
- Nigeria’s economic growth rate falls by 0.68% in Q1 - May 25, 2020
- States’ IGR leaps to N1.33 trillion in 2019 - May 22, 2020
- NSE: Mobil, Conoil, UACN lead advancers as market extend gains - May 22, 2020