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OPINION: Nigeria’s blood oil

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In July 2015, Nigerian President, Gen. Muhammadu Buhari, fresh from that
year’s presidential election victory after three failed successive attempts
visited the United States of America on a thank you tour. America under
Barack Obama and Tony Blair, prime minister of the United Kingdom had
conspired with the rest of the West to intimidate the cowardly President
Goodluck Jonathan and then impose Buhari on hapless Nigerians.

While on that visit Buhari made two significant but atrocious statements. First, he said that sections of the Nigerian society who rejected him at the poll would be punished. To paraphrase Buhari, he said that nobody should expect him to treat those who gave him 5% of their votes the way he would treat those who gave him 97% of their votes. And he had proceeded to live that vow in the seven years, so far, of his presidency. And second, Buhari told his stunned audience that one million barrels of crude oil were being stolen in Nigeria every day under the presidency of Jonathan. Of course, he lied and had to leave his aides scrambling to find a more reasonable figure of crude oil theft under his predecessor.

However, the obvious lie about the quantity of crude oil theft then is not our concern here simply because, as it has turned out in the intervening years, many of the things said by Buhari and the ruling All Progressives Congress [APC], including their promises, have turned out to be a bouquet of lies.
Buhari had said then that: “The amount involved is mind-boggling. Some
former ministers were selling about one million barrels per day”. At another
forum, he mentioned a different figure far lower than one million barrels of
stolen crude oil. When asked to confirm Buhari’s claims, his media aide
Garba Shehu said “the official position on the quantity of crude oil stolen per day in Nigeria (was) 250,000 barrels”. When he was pressed for evidence,
he had none. Ordinarily, it is said that if a problem is identified, it is half
solved. This does not apply to Nigerian rulers, certainly not to Buhari. Crude
oil theft has been the lot of Nigeria for decades and since the return to
democracy about 22 years ago.

It happened under Gen. Olusegun
Obasanjo, Presidents Umaru Yar’Adua and Jonathan. But under Buhari it
has become a monster and a criminal enterprise with tentacles stretching
from Nigeria to other parts of Africa, Asia, Middle East and Europe. Under
previous administrations, crude oil theft was estimated to be well under 10%
but with the advent of Buhari and the APC, 70% of Nigeria’s crude oil is
reported stolen on average. I did not make this up. On March 25, a Nigerian
newspaper reported that Nigeria lost $3.27billion worth of crude oil to thieves in the 14 months between January 2021 and February 2022. The Independent Petroleum Producers Group said that 82% of their oil production was stolen in the month of February 2022 alone. Its spokesman, Chikeze Nwosu, who is also the managing director of Waltersmith Petroman, said independent producers are facing existential threats. He claimed that crude theft had skyrocketed from about 4% in the past to as high as 91% in December 2021.

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The International Oil Companies (IOCs) in Nigeria said what is happening in
the country’s oil sector beggars belief. It said the situation which is not new
has rapidly deteriorated from mere crude theft to organized criminality with
high levels of sophistication. Chairman/MD of ExxonMobil, Richard Laing, who represented the IOCs at the same Abuja event said: “As an industry, I know how hard my colleagues work to produce products that we need and
to suffer the level of theft that we have is disheartening. But more importantly, it is a threat to investments, a threat to the health of the industry and wealth of the nation”. Liang took exception to the use of the word theft to describe what is going on. “The language is very important and I think we use theft rather quickly. I don’t think this is theft, this is organized criminal activity. The level of sophistication in terms of tapping into the pipelines, the distributions,
efforts required to move hundreds of thousands of barrels a day isn’t some
guy coming along and tapping into a pipeline and taking container crude oil.
It’s organized criminality”.

Gbenga Komolafe is the chief executive of the Nigerian Upstream Petroleum
Regulatory Commission (NUPRC). He told stakeholders that criminals have
laid siege to Bonny Terminal Network, Forcados Terminal Network and
Brass Terminal Network, all major crude oil export terminals. He said the
situation in the upstream is nothing short of a threat to the “existence and
wellbeing of Nigeria”. Recently, a billionaire businessman and philanthropist did the unusual. Tony Elumelu publicly criticized the extant government, virtually saying that this administration was performing below par in the crude oil sector. He said serial failures of successive administrations have left investors in the sector reeling in their losses while oil vandals and criminals are daily taking victory laps. He queried: “How can we be losing over 95 per cent of oil production to thieves? Look at the Bonny Terminal that should be receiving over 200,000 barrels of crude oil daily, instead it receives less than 3,000, leading the operator, Shell, to declare force majeure. We, Heirs, will produce crude oil and the thieves will steal like 50,000 barrels per day. In my opinion, it is one of the most lethal threats to our country because there is so much money in the hands of people who don’t pay taxes and people you don’t regulate. The country is not safe”.

Former military dictator, the late Sani Abacha, was reported to have said that
if an insurgency lasted for more than 48 hours, then the government must
have a hand in it. The same applies to the decades-old industrial scale theft
of Nigeria’s crude oil. The government knows thieves, that’s if government
leaders or their friends are not the thieves. But if it claims it does not know them, then it has failed in one of its cardinal duties: safe-guarding life and property of citizens and securing our national assets. And given Nigeria’s
situation, there probably is no greater and more valuable national asset,
apart from the badly Nigerians, than crude oil. The oil thieves and how they
operate have been in plain sight for years, so the recent statement by the
federal government that it will set up a probe panel on the issue is a distraction and vexatious. Some international agencies and knowledgeable
Nigerians are convinced that Nigeria does not know the quantity of oil it
produces daily. They say what is exported does not tell what comes out from the ground because the tallies are usually taken from the terminal and not
the well head. “The oil fields are not sufficiently metered in a way that permits independent verification”, Nnimmo Bassey, an environmental activist once told Africa Check. “The state of affairs makes it impossible to have a good guesstimate of the nation’s crude reserves…”. Blood Oil in the Niger Delta
was the title of a report on oil theft in Nigeria. The decade-old report exposed how the thieves operate. They may have gone nuclear since then, but the report still provides an insight. It said one of the methods employed by the
thieves is to tap either the pipeline or the well head. “The process involves…
attaching a hose to siphon off the oil. From there, the oil is placed on small
barges and taken out to sea, where it is loaded onto large ships lurking
(supposedly) out of sight of authorities”. Local youths do the dirty work, but international syndicates from Eastern Europe, Russia, Australia, Lebanon, the Netherlands, and France all play roles in financing, transporting and laundering the proceeds. Another approach, according to the report is for
companies to pump more oil than their licences allow. And this involves oil
company staff, ranking Nigerian National Petroleum Corporation officers and
top government officials who award the oil lifting contracts.

The simple truth is that Nigeria does not know the quantity of oil extracted
from its belly daily and so is not in a position to say how much of it exactly was being stolen.

AUTHOR: Ugo Onuoha


Articles published in our Graffiti section are strictly the opinion of the writers and do not represent the views of Ripples Nigeria or its editorial stand.

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