Chief Financial Officer (CFO) Nigerian National Petroleum Corporation (NNPC) Limited Umar Ajiya has said Nigeria loses $150 million in revenue every day.
Ajiya said the pipeline vandalism and sideline production were factors behind the loss.
He spoke Wednesday during an interview with Arise TV monitored in Abuja, saying the development had prevented Nigeria from benefitting from the high oil price.
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 said.
Also, the NNPC Limited CFO defended the N674 billion net profit for 2021 announced by the company, after it was rated low compared to its peers.
Ajiya blamed it on hindrances faced by NNPC Limited, which he said people never factored into their analysis of the firm’s performance.
“The fact remains that with the Petroleum Industry Act (PIA) in place, such hindrances have been removed, and so the NNPCL will be able to do better like other companies in terms of performance and profits of dividends to its shareholders. Those hindrances that have now been eliminated by the PIA will help us deliver profits in billions of dollars,” he said.
NNPC uncovers 4km crude pipeline
In a related development, the NNPCL 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 said this 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.
The implications of this, he said, was the destruction worse than the Ogoni spillage devastation in the affected areas that disrupted agriculture and fishing activities in the communities.
Going forward, Kyari said, the company carried out aerial surveillance of the affected areas which revealed the oil thieves carried out their activities unchallenged.
Expert reacts
The news of the discovery has got many Nigerians talking and wondering how it was possible for the criminals to perpetrate the act.
Kalu Aja a financial expert took to his twitter account to express his dismay that an activity of such magnitude was undetected for so long.
He said: “Why should I pay a kobo of taxes if the Federal Government ALLOWS a 4km pipeline stealing crude oil to exist for years. A loading port 4km into the sea, but the navy did not see it.
“If I was a South South Governor, I will push for the States to take over the management of crude oil and gas from the Federal Government.
“The FG has failed to manage the federation asset; States at least are closer to the crime scene.
“Nigeria is borrowing to repay interest and a few demons are exporting crude oil? If this was Ghana, not America, Ghana, the NNPC, Navy, Army, civil defense, DSS and police chiefs would all be in jail.” Additional reports from www.ripplesnigeria.com
