NIGERIA: Government and industry experts say Nigeria is losing nearly a fifth of its revenues to oil thieves

Record ID: 235675

  • Title: NIGERIA: Government and industry experts say Nigeria is losing nearly a fifth of its revenues to oil thieves
  • Date: 29th May 2012
  • Summary: VARIOUS OF POOR VILLAGE IN THE OIL PRODUCING AREA REFINED CRUDE IN BARGES READY TO BE SHIPPED SOLDIERS VILLAGE STREET
  • Embargoed: 13th June 2012 13:00
  • Keywords:
  • Location: Nigeria
  • Country: Nigeria
  • Topics: Crime,Business,Industry,Politics
  • Reuters ID: LVAB0ESA7H4UXJ1YV27BWC74RCVS
  • Story Text: Nigeria is losing nearly a fifth of its revenues to oil thieves annually, government officials and industry experts have said.
    Nigeria's finance minister recently told the country's leading daily newspaper that the country was losing a fifth of its revenues to oil theft and urged quick action to stamp out the practice.
    Those involved in oil theft like Peter said they have no remorse adding that they had nothing else to turn to support their families in a region where foreign oil companies and government is making a lot of money.
    "If we get at least ten drums of diesel we can make 80,000 to 100, 000 naira daily and before Government stops this thing," Peter said, adding "At least they have to create a job for everybody in this business and compensate the owners of the facilities we used."
    Oil companies say so called 'bunkering' -- tapping into oil pipelines to steal the crude -- and other forms of oil theft are on the rise, despite an amnesty that was meant to end a conflict there in 2009 over the distribution of oil wealth.
    Nigeria's biggest player Royal Dutch Shell has estimated that up to 150,000 barrels of crude are stolen from Nigeria each day, out of production of around 2 million.
    Tony Attah, Vice-President Corporate Affairs, Shell Sub-Saharan said the company's joint venture lost a minimum of 4300 barrels a day of crude oil to theft last year alone.
    "We are talking about crude theft at a scale that is unprecedented in the Niger Delta. There are three level of it which I see within my business; there is the small players, who today use the crude oil locally in the industrial, who crude directly into their furnaces beacsue they get it cheaper; there is the group that refines it, which for us on the environment front is the worst because they have low level of efficiency and imagine they have 30 percent efficiency and whatever can't be refined is just dumped into the river and that is having severe damage on the environment. But then there is strong economy linkage from the big players and today the estimate we have seen is more than 150,000 barrel per day, that comes almost 150 million dollars a day and five billion dollars a year," he said.
    The 2009 amnesty sharply reduced militancy in the Niger Delta, a network of creeks and wetlands where the Niger river empties into the Atlantic, but bunkering has continued.
    Despite government crackdowns on oil thieves and illegal refineries in the region, business is thriving.
    In the past few days the Nigerian military has been tracking down oil thieves and operators of illegal refineries but the terrain and the nature of the creeks makes it difficult to quickly access some of the spots.
    Lieutenant Colonel Onyama Nwachukwu who has been on several raids on illegal refineries said it appeared as though every village in the Niger Delta region was involved in the illicit trade.
    "There is a serious syndicated effort within this general area that is the Niger Delta region to be involved illegitimacy, in illicit activities that are having negative impact on our economy, from the point of view of being involved in illegal oil bunkering," he said.
    Nwachukwu said the military had recently destroyed over 500 illegal refineries, captured dozens of barges, large wooden canoes and other containers laden with stolen oil.
    Ironically the Niger Delta has remained very poor despite vast quantities of natural resources.
    Residents blame oil companies and the government for their underdevelopment, environmental pollution and criminality in the region.
    Recent figures released by the National Bureau Statistics revelled that 90 percent of Nigeria's 150 million people live in poverty.
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