Vice President, Professor Yemi Osinbajo has said that oil theft and losses pose a serious threat to Nigeria’s economy and impact negatively on the revenue of the nation.
Osinbajo spoke at the one-day Stakeholders Conference on Oil Theft and Losses in Nigeria with the theme “Protecting Petroleum Industry Assets for Improved Economy” organized by the Special Investigative Panel on Oil Theft/Losses in Nigeria, on Tuesday in Abuja.
According to Osinbajo, oil theft if left unchecked, would spell doom for Nigeria and could fuel a public finance crisis that paralyses the government, which he said would make the nation vulnerable.
He said, “Oil Theft and Losses is a threat to our economy and national security. They pose a serious threat to our oil economy and impact negatively on revenue of the nation and business prospects of investors in the oil and gas sector.
“If left unchecked this could fuel a public finance crisis that could paralyse the government and make our nation vulnerable. Oil contributes about 80 percent of government foreign exchange and contributes six percent of the country’s Gross Domestic Product, GDP.”
He said that large scale theft of crude has undermined the government’s efforts to maximise these resources. This was as he called for a collaborative action to hold Institutes and companies accountable for any loss or failure.
Osinbajo disclosed that the Nigeria Extractive Industry Transparency Initiative, NEITI, pegged the oil theft and loss audited figures as something in the order of 619.7 million barrels of oil daily, which he said was valued for over $46 billion or N16.25 trillion, adding that these losses occurred between 2010 and 2020.
He said, “In addition Nigeria lost about 4.2 billion litres of oil petroleum products from refineries which was valued at over $1.84billion at the rate of 140 thousand barrels per day from 2009 to 2018.
“So the total value of oil lost between 2019 and 2020 is higher than Nigeria’s foreign reserves at any point in time and almost ten times Nigeria’s oil savings in the excess crude account. So it’s not an exaggeration at all to say that our oil and gas sector is facing the most serious threat for over half a century.”
Earlier in his welcome address, Chairman of the Special Investigative Panel on Oil Theft/Losses in Nigeria, Major Gen. Barry Ndiomu, Rtd, said that the federal government’s decision to award pipeline surveillance contracts to some private security companies has led to the widely discovery of an illegal connection used in the diversion of crude oil along the TransEscravos Trunk Line.
He explained that the panel has been embarking on field visits to locations and facilities on and offshore and extensively engaging government and non-government stakeholders as well as in-house deliberations aimed at unpacking and unravelling what has become the country’s most troubling economic debacle.
Ndiomu maintained that there is no gainsaying the enormous impact the menace of oil theft has had on the nation’s crude oil production with Nigeria’s oil output hitting a 13-year low of 800,000 barrels/day.