Nigeria, Africa’s leading oil producer, is facing a significant and persistent issue that is taking a toll on its economy: crude oil theft. The Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed that the country lost an estimated 620 million barrels of crude oil valued at $46 billion between 2009 and 2020. This revelation highlights the profound impact of this problem, both domestically and globally.
This illicit trade in stolen oil is a multifaceted challenge. While some incidents involve local criminal groups stealing crude from pipelines for makeshift refineries, a more substantial portion of stolen oil is smuggled out of the country through large tankers, finding its way into international markets.
The impact of this theft extends beyond crude oil alone. NEITI’s data also points to significant losses of 4.2 billion liters of petroleum products, valued at around $1.84 billion, from 2009 to 2018, stemming from internal refinery pilferage.
Ogbonnaya Orji, the Executive Secretary of NEITI, revealed that oil theft is primarily carried out through a method known as “pipeline clamping.” Criminals tap into pipelines to extract crude oil, leading to damage to vital infrastructure and substantial resource depletion.
The consequences of these losses are substantial. Despite the challenges posed by oil theft, pipeline vandalism, sabotage, and insecurity, the oil and gas sector remains the linchpin of Nigeria’s economy. It accounts for an impressive 72% of the country’s total exports and foreign exchange earnings, contributing a substantial 40% to the government’s revenue.
In his address at the 2023 International Pipeline Technology and Security Conference in Abuja, Mr. Orji emphasized that Nigeria’s inability to mitigate these challenges has prevented it from fully capitalizing on its abundant oil and gas resources.
NEITI plays a crucial role in this landscape. It operates within the global Extractive Industries Transparency Initiative (EITI) scheme, aiming to improve transparency and accountability within the extractive sector, crucial in addressing the challenges of oil theft and revenue losses.
As Nigeria grapples with this ongoing issue, it underscores the urgency for the government to enact robust measures to combat oil theft and protect its valuable oil and gas resources. These actions are not only vital for Nigeria’s prosperity but are also critical for maintaining global economic stability.
Photo ( CHINEDU OKAFOR)
By: Montel Kamau
Serrari Financial Analyst
9th November, 2023
Article and News Disclaimer
The information provided on www.serrarigroup.com is for general informational purposes only. While we strive to keep the information up to date and accurate, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.
www.serrarigroup.com is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information on the website is provided on an "as-is" basis, with no guarantee of completeness, accuracy, timeliness, or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
In no event will www.serrarigroup.com be liable to you or anyone else for any decision made or action taken in reliance on the information provided on the website or for any consequential, special, or similar damages, even if advised of the possibility of such damages.
The articles, news, and information presented on www.serrarigroup.com reflect the opinions of the respective authors and contributors and do not necessarily represent the views of the website or its management. Any views or opinions expressed are solely those of the individual authors and do not represent the website's views or opinions as a whole.
The content on www.serrarigroup.com may include links to external websites, which are provided for convenience and informational purposes only. We have no control over the nature, content, and availability of those sites. The inclusion of any links does not necessarily imply a recommendation or endorsement of the views expressed within them.
Every effort is made to keep the website up and running smoothly. However, www.serrarigroup.com takes no responsibility for, and will not be liable for, the website being temporarily unavailable due to technical issues beyond our control.
Please note that laws, regulations, and information can change rapidly, and we advise you to conduct further research and seek professional advice when necessary.
By using www.serrarigroup.com, you agree to this disclaimer and its terms. If you do not agree with this disclaimer, please do not use the website.
www.serrarigroup.com, reserves the right to update, modify, or remove any part of this disclaimer without prior notice. It is your responsibility to review this disclaimer periodically for changes.
Serrari Group 2023
