October 10, 2022, was a day of pride for the Nigerian government, as security agents set fire to a vessel used for crude oil theft in the Niger Delta.
[Image source: Sahara Reporters]
However, many Nigerians didn’t believe that this was a victory worth celebrating. The presidential candidate of the African Action Congress (AAC), Yele Sowore, believes the vessel was destroyed in order to cover up the Nigerian government’s involvement in crude oil theft.
Crude oil theft is as old as the day it was it was discovered in the small town of Oloibiri, Bayelsa State, in 1956.
Given that Nigeria makes most of its total national revenue from exporting oil, the country loses billions of naira to the private pockets of thieves. These billions of naira could be better spent on national development — if politicians don’t steal it first.
The trend of petroleum pipeline vandalism in Nigeria has escalated over the years. For example, vandalism incidents surged from 57 incidents in 1998 to over 2,500 incidents in 2008.
Notably, in the 2000s, the Movement for the Emancipation of Niger Delta (MEND) and other militant groups organised attacks on oil industry infrastructure. Many militant leaders gained regional power and influence and made the rebellion a key problem of the Nigerian government and oil companies in the Niger Delta.
The situation eventually evolved into an all-comers affair that we now have today with everyone trying to illegally fill their pockets with the golden goose that’s crude oil.
How’s Nigeria’s oil stolen?
Over the decades, oil thieves have designed many methods to steal Nigeria’s oil. Let’s look at the most common ones.
Hot tapping
A connection is made to an existing oil pipeline without interrupting oil flow.
Cold tapping
This involves the use of a drilling machine to branch a pipe offline from the existing network.
Oil bunkering
This involves stealing crude oil directly from oil companies and channeling the product into tanks
Regular stealing
The oil product is transported to oil shipping terminals for export.
Who’s stealing Nigeria’s oil?
Between January 2022 and June 2022, the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) reported that Nigeria’s oil output dropped by 12.5%. In that period, Nigeria lost between 200,000 to 400,000 barrels of oil per day. See how bad it is?
In 2019, the governor of Rivers State, Nyesom Wike, said oil theft is impossible to stop in Nigeria because it’s sponsored by influential people. Critics like Sowore have accused the top military and government officials, highly-placed and retired oil industry personnel, and politicians of benefitting from the theft.
How can Nigeria stop oil thieves?
How can the Nigerian government reduce oil theft? Well, we have a few ideas:
- Improve ship registration: Crews on ships can easily change the names of flags, logos, etc. Listings of these crude oil ships must include the ship’s beneficial ownership and be aligned with international maritime safety protocols.
- Ship-to-ship transfer must be monitored by the Ministry of Petroleum. But how can one get to do that effectively when the petroleum minister is the president? Hmm.
- Vessel clearance practices around oil installations must be strengthened.
- The government should refine due diligence practices.
