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Poor Measurement Responsible For 40% Of Crude Oil Losses – NUPRC

Inaccurate measurement in the Nigerian oil and gas industry is responsible for about 40 percent of crude oil losses attributed to oil theft in the Niger Delta region, the Nigerian Upstream Petroleum Regulatory Commission, NUPRC has said.

The Federal Government had last year estimated that about 200,000 barrels of oil was lost daily in Nigeria due to oil theft and pipeline vandalism.

The Nigeria Extractive Industries Transparency Initiatives, NEITI, has over the years raised alarm that the country does know exactly the volume of crude oil produced by the industry and called for installation of meters on production well heads.

NUPRC Chief Executive, Gbenga Komolafe in a statement on Sunday attributed 40 percent of the volume recorded as losses to poor measurement.

Engr. Komolafe who stated this in Lagos at the Petroleum Club Quarterly Dinner, said the revelation followed a forensic audit conducted by the Commission covering the period January 2020 to November 2022 on crude theft numbers.

The audit was to ascertain with accuracy the stolen volume of crude oil within the reference period, he explained.

He said the Commission “is committed to dealing with the issue of metering errors by ensuring that Original Equipment Manufacturers licensed directly as agents of the Commission will be responsible for deployment and maintenance of metering facilities across the Nigeria’s oil and gas facilities, for transparency in hydrocarbon accounting”.

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He noted that the “reform measure adopted by the Commission offers a paradigm shift from the trajectory in Nigeria’s hydrocarbon measurement since oil was discovered in Nigeria in Oloibiri in 1956; and is aimed at ensuring that no one becomes a judge in his own case.

“Admittedly, one major area of value erosion in the industry is the menace of crude oil theft. Our records indicate that the menace of oil theft has negatively impacted the oil and gas sector for about two decades with attendant huge financial losses to our nation.

“The Commission, in collaboration with the various arms of the Security forces, the NNPC Limited and the host communities, have been able to suppress the ugly trend of hydrocarbon value decimation. Now, our nation has continued to record good dividends of these collaborative efforts as production figures are progressively increasing”.

He stressed that “the January 2023 volume is approximately 1.5 million barrels per day of oil and condensates. It is expected that this number will continue to increase as further measures are introduced and sustained to remove all illegal connections that aid crude oil theft”.

Source: vanguard

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