Nigeria has about 265 Illegal refineries In the Shell Petroleum Development Company (SPDC) Corridor alone.
This was revealed by President Timipre Sylva, Minister of State for Petroleum Resources, on the 60th anniversary of the Oil Producers Trade Division (OPTS) of the Lagos Chamber of Commerce and Industry (LCCI), according to NAN.
Nigeria loses millions of barrels of crude oil every year due to theft and sabotage, including the theft of crude oil from a network of pipelines operated by major oil companies. This shows how lax security leads to significant financial losses to the nation.
what are they saying
The Minister, who was represented by Mr. Kamaru Busari, Acting Permanent Secretary at the Ministry of Petroleum Resources, stated that acts of sabotage and oil theft have reduced Nigeria’s crude oil production to less than one million barrels per day.
Silva claimed that the country’s failure to achieve its share of OPEC has cost it much-needed oil revenues at a time when oil prices were high on the global market.
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However, he stated that the government is working with host communities, security agencies and technology to address the problem in order to boost investor confidence in the sector.
Malam Melle Kyari, Group CEO of Nigeria National Petroleum Corporation Limited (NNPCL), on his part, stated that the company was aware of the existing difficulties, particularly the security in the operating areas and the payment of arrears of cash calls.
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Mr. Dapo Segun, Deputy General Manager Treasury, NNPCL, like Kyari, insisted that the company was resilient and would work with other stakeholders to overcome security concerns.
He said: “We have deployed innovative solutions to address security challenges in our areas of operation. Technology intervention will also be established for both monitoring and immediate intervention. Addressing this risk is a top priority for the NNPCL.”
“Also, our new governance framework provides us with independence and the opportunity for self-accountability, thus, cash calls, including arrears, will be settled and dealt with promptly.” he added.
Mr. Rick Kennedy, Chairman of the OPTS Board of Directors, stated earlier in his welcome speech that over the past 60 years OPTS has made significant contributions to the growth of the Nigerian oil and gas industry.
Kennedy stated that OPTS members have demonstrated resilience and commitment in addressing economic, security, environmental, and financing challenges. Kennedy as Mr. Osagie Okunbor, OPTS Vice President.
He said: “We have continued to make significant contributions to Nigeria’s development.
As a group, OPTS member companies account for approximately 90 percent of Nigeria’s oil production and contribute significantly to domestic gas production and supply and export.
he added “Over the past decade, OPTS member firms have accounted for 40-60 percent of government revenue and 85 to 95 percent of export revenue. OPTS member firms are also proud to have paid tens of billions of dollars in taxes, fees, royalties, rent and licensing fees to the Nigerian government” .
Kennedy, who is also the managing director of Chevron Nigeria/Mid-Africa Business Unit, said OPTS companies have also created more than 600,000 direct and indirect jobs for Nigerians.
Mr. Bunmei Toyobo, CEO of OPTS, also thanked the 29 companies that were OPTS members for their contributions to their achievements in the past 60 years.
“This celebration is to show our firm belief in Nigeria as a group and our belief in the unlimited growth potential of our country, given the favorable environment,” He said
What you should know
- Due to the theft of crude oil, Nigeria lost a staggering $1 billion in revenue in the first quarter of 2022, jeopardizing the economy of Africa’s largest producer based on reports.
- Nairametrics reports that police have deployed their assets to tackle perpetrators of economic crimes aimed at sabotaging Nigeria’s income-generating value chains, including sabotaging crude oil.
- Nairametrics also reported earlier this year that Austin Avuro, Founder MD/CEO of Seplat Energy and CEO, AA Holdings warned that oil production in Nigeria had reached a critical emergency. He stated that some oil production wells do not reach 80% of production reaching the stations due to oil theft.
- The theft resulted in the Boni Oil and Gas Terminal, a pipeline that transports crude from the oil-rich Niger Delta to export vessels among other places, creating a situation of force majeure, making the atmosphere unfriendly and discouraging for investors.