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Tag: crude oil theft

  • Senate moves to probe crude oil thefts in Niger Delta

    Senate moves to probe crude oil thefts in Niger Delta

    The Senate has mandated its Committees on Petroleum Resources, (Upstream, downstream,) Gas, Host communities and Niger Delta to conduct investigation on oil theft in the region.

    It specifically mandated the committees to investigate the actions of security forces, militia groups, local populace,all company employees, and any individuals or entities suspected to be using sophisticated methods to pilfer from oil facilities within the country.

    The resolution was sequel to adoption of a motion at plenary on Tuesday on “Urgent need to investigate incessant and nefarious acts of crude oil thefts in Niger- Delta region.

    The motion was sponsored by Sen. Ned Nwoko (PDP- Delta) and Co sponsored by Sen. Ede Dafinone and Sen J.Thomas.

    Nwoko in his lead debate said that Nigeria was largely dependent on crude oil for its economic growth and development.

    He said the National Bureau of Statistics (NBS) reported that oil sector contributed 6.33 per cent of the nation’s GDP which translated to 45.6 billion dollars in 2022 .

    Nwoko said the oil sector in Nigeria plays pivotal role in providing employment opportunities for millions of Nigerian citizens accounting for 70 per cent of its budget financing, while oil and gas made up of 90 per cent of export and 85 per cent of government revenue in the first quarter of 2022.

    He said statistical data which has been reported over the years, indicated that pipeline vandalism, oil bunkering, has brought Nigeria Into serious socio-economic crisis.

    The senator said current collaborative efforts involving joint task force of the military,with contributions of various security entities, state and local governments, and International Oil Companies (IOCs) in the Niger Delta region has yielded positive results.

    He said the efforts has led to an increase in oil production, reaching 1.51 million barrels per day in first quarter 2023.

    ” This figure marks an improvement from the 1.49 million barrels per day recorded in the same quarter of 2022 and is notably higher than the production volume of 1.34 million barrels per day in the fourth quarter of 2022.”

    Nwoke said inspite of efforts of military personnel and security agencies in combating oil theft in the Niger Delta region, he, however alleged of individuals within the institutions who engage in illicit activities.

    “These individuals collaborate with unscrupulous figures within the oil industry to undermine the nation’s economy.

    “Also observes that it has come to attention that oil theft in Nigeria thrives due to a troubling collaboration between security forces, militia groups, the local population, and certain employees within oll companies .

    “These parties employ sophisticated methods to carry out theft from all facilities located within the country given Nigeria’s vast oil and gas reserves.”

    He expressed concern of alleged accusations and counter-accusations of oil bunkering and various other crisis between the military and local militia groups.

    “In 2022, it was reported that Nigeria suffered daily loss of approximately 437,000 barrels of crude oil, amounting to a value of 23 million dollars, due to criminal activities.

    ” Moreover, between March 2023, Nigeria incurred a substantial loss of 65.7 million barrels of crude oil, valued at 83 dollars per barrel, translating to a staggering revenue loss of N2.3 trillion as a result of oil theft.”

    He expressed worry that the activities of oil thieves and their collaborators has significantly hampered crude oil production posing a substantial threat to the nation’s economy.

    Contributing, Sen. Mpigi Barinada(PDP- Rivers) called for proper check on issues of oil thefts in Niger Delta, adding that there was challenge of collaboration among security agencies.

    Sen.Osita Izunaso (APC- Imo) said oil bunkering was a major economic sabotage for Nigeria , saying that it was a multifaceted issues.

    He said the solution required sustainable measures and not on ad-hoc basis.

    Sen.Buhari Abdulfatah called for a review of the laws to provide for punitive measures for would be offenders.

    Sen.Adams Oshiomole (APC-Edo) urged the Senate to support President Tinubu in the fight against oil thieves,saying that it was time to stop oil thefts in Nigeria.

    He said it was shameful that so much was been stolen from oil, and urged the senate to invite the service chiefs to interface with senate on what the security agencies were doing to stop oil thefts.

    President of Senate, Godswill Akpiabio said he believes strongly that the Armed Forces were in better position to secure the country.

    He thanked the sponsor of the motion, while urging the committee to do a holistic investigation in the interest of the nation.

    Senate consequently urged the committee to present its report on the investigation in six weeks.

  • Crude oil theft: Reps summon NNPC, NIMASA, NIWA CEOs

    Crude oil theft: Reps summon NNPC, NIMASA, NIWA CEOs

    The House of Representatives ad hoc committee investigating crude oil theft has insisted on the appearance of the Group Chief Executive Officer of Nigeria National Petroleum Company Ltd (NNPC) and others before the committee.

    They include the Nigeria Maritime Administration and Safety Agency (NIMASA) and the Nigeria Inland Waterways Authority (NIWA).

    Rep Alhassan Rurum, the Chairman of the probe panel, gave the ruling in Abuja, adding that the heads of the agencies must appear in person and not send representatives.

    Rurum said the heads of all the invited agencies must appear in person on Sept. 11, while frowning at a situation where the heads of the agencies invited did not appear but sent their directors as representatives.

    He said most of the invited CEOs wrote to the committee asking for permission to be represented by their subordinate as they were not disposed to appear in person and honour the committee’s invitation.

    He said the committee had the powers to invite and cause appearance of any individual, government officials including corporate entity charged with the responsibility of administration of public funds.

    At the hearing, the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Nigeria Upstream Regulatory Authority (NUPRA) said pipelines and flow stations were the major targets of oil thieves.

    They blamed faulty metering procedure, faulty instrument and lack of technology as impediments in the efforts of  agencies of the Federal Government in tackling oil theft.

    Rurum, however, said that the invited CEOs of the agencies should come with a list of all other agencies working in export terminal of all the  nation’s oil sector.

  • Ijaw elders write Tinubu over oil theft menace

    Ijaw elders write Tinubu over oil theft menace

    Ijaw Elders Forum (IEF), a coalition of Ijaw groups, has written to President Bola Tinubu to demand a review of procedures in disposal of vessels and trucks seized for complicity in oil theft.

    The letter, dated July 31 and sighted on Thursday, condemned the menace of oil theft and the attendant effects on the Nigerian economy and the  Niger Delta environment.

    According to the letter, signed by Chief Efiye Bribena, Secretary of IEF, the indiscriminate blow up of vessels used for oil theft had adverse impact on the environment which the people depend on.

    “We write to express our utmost dissatisfaction on the mode of disposal of vessels and trucks impounded with stolen crude in the Niger Delta.

    “Destroying vessels laden with crude oil exacerbates the existential threat to the environment and survival of the people.

    “In fact, the destruction of the MT TURA in the latest incident by bombing of the vessel was extremely horrifying and unacceptable,” the IEF said.

    The IEF recommended implementation of measures in the interest of the environment, transparency and the national economic interest.

    “NNPCL and the Military Authorities should improve the Standard Operating Procedure (SOP) for disposal of such vessels in the future.

    “All efforts should be made to evacuate the stolen crude to the nearest oil Flow station, Oil Terminal or Refinery before proper disposal of such vessels.

    “The relevant authorities should install an open-access portal for tracking vessels that are seized with stolen crude and products, up till the point of final disposal,” the IEF said.

    The group sought collaboration with stakeholders such as the Nigerian Extractive Industries Transparency Initiative (NEITI), Extractive Industries Transparency Initiative (EITI), and the International Maritime Organization (IMO).

    The IEF letter was also endorsed by representatives of the coalition comprising Ijaw Professionals Association, Ijaw Nation Forum, G24 Embasara Foundation, and Ijaw Women Connect.

    They urged the federal government to be transparent and disclose the masterminds of the syndicate as well as the prosecution of the owners of the impounded vessels.

    The forum also appealed to the President to prevail on the oil industry regulators to urgently direct oil firms to safely decommission all idle well heads and pipelines in the Niger Delta region.

    The IEF urged the agencies of the federal government in the oil sector to discourage artisanal refineries and set machinery in motion to promote construction of modular refineries in oil bearing communities.

  • Something fishy in our waters – By Dakuku Peterside

    Something fishy in our waters – By Dakuku Peterside

    It is a scientific fact that water and oil do not mix, but in the complex and complicated world of criminal enterprise, this natural law does not apply. It is becoming evident that in Nigeria’s crude oil theft industry, there is an inexplicable convergence of interest against the interest of the country. This has gone on for too long , hurting our economic calculations as a country.

    A massive vessel, “MT Tura 11”, laden with 800 metric tonnes (erroneously stated as 800,000 litres) of stolen crude oil, was intercepted on Escravos Sea in Delta State by operatives of Tantita Security Services Limited. They handed over the vessel to the military Joint Task Force (JTF) Operation Delta Safe troops.

    The JTF personnel allegedly set the bunkering vessel ablaze on Warri River after the ship’s captain confessed that the ship was laden with crude oil. Could the recent arrest and subsequent setting ablaze of a vessel used for oil theft be a case of a complex web of organised economic crime or failure of law enforcement? The facts of this case are as intriguing as the entire landscape of oil theft, maritime crime, and environmental degradation in the Niger Delta. This operation has caused considerable unease among stakeholders in the oil and gas industry, maritime space, law enforcement and ecological conservation activists. It raises a lot of fundamental questions with no answers in sight.

    First, is the burning or destruction of vessels transporting stolen crude oil the best approach to fighting the crime? This entails destroying evidence that would aid investigation and prosecution. The hasty destruction of the oil theft vessel raises questions about due process in the fight against what may be considered a complex economic crime against the state. In every crime investigation system and process, the instant destruction of evidence leaves a trail of further suspicion.

    There are elements of concealment of a wider crime that a more thorough and discreet investigation will reveal. This vessel had been arrested severally in connection with crude oil theft and released. We are unaware of any arrest and prosecution connected with these previous incidents. The JTF had, in October 2022, destroyed a vessel, MT Deima, allegedly carrying stolen crude. Burning vessels used for crude oil theft is now a common practice and a pattern of a deterrent.

    The Defence Headquarters’ defence to this noxious practice is a certain executive order given by former President Olusegun Obasanjo in 2003. However, in 2019, facilitated by Nigerian Maritime Administration and Safety Agency (NIMASA), Nigeria’s National Assembly passed the Suppression of Piracy and Other Maritime Offences Act (SPOMO Act), which provided the legal framework to deal with this kind of issue, including provisions for asset forfeiture and disposal of proceeds.

    Second, will burning crude oil at sea not exacerbate the already severe environmental degradation in the Niger Delta? Elementary science has taught us that it will lead to air and marine pollution, degraded mangroves, and oceans, and destroyed biodiversity and vegetation.

    In this instance, the burning of 800 MT of crude, if it took place, will have far-reaching and long-lasting effects on the environment and the communities dependent on it. The cleaning up of the environment could take several weeks. While addressing the issue of stolen crude should remain crucial, environmental protection must remain a priority.

    Third, on the issue of law enforcement, with multiple maritime intelligence gathering technology available in the country, such as Nigerian Navy’s “Falcon Eye”, NIMASA’s “C4i and NPA’s “C3i”, how come none was able to detect a tanker vessel as big as MT Tura 11 or MT Deima? Does it not raise curiosity that it took a security contractor rather than the Navy or other security agencies to intercept and arrest the rogue vessel?   Is this a case of conspiracy, complicity or just abdication or dereliction of duty? When juxtaposed with the allegation of Mujahid Asari Dokubo of a compromised military, it calls for deep investigation, interrogation, and introspection.

    There are obvious vested interests, and things are unravelling. And one wonders whether this operation has anything to do with the N48 billion per annum pipeline surveillance and security contract. Is there a “Wangerisation agenda” in the crude oil pipeline contract?

    This incident provides an opportunity for a holistic review of our approach to fighting oil theft in the country. The criminal violation in oil theft has been a concern for years. This is despite the existence and presence of the Navy in the suspected theatres. Getting to the bottom of this criminal enterprise requires more than the arrest of one errant vessel. It requires a thorough investigation to establish the missing links between the arrested vessel and other activities in the past. As we already know, oil theft is a major national economic crisis that requires a deeper understanding and collaborative action as a national priority.

    A few issues are for consideration. Should we not consider asset forfeiture and disposal instead of burning, which is barbaric, crude, unhealthy and toxic? Have we considered recovery and repurposing the stolen crude for legitimate use? What level of interagency collaboration do we have in the fight against crude oil thieves? From the overall layout of the narrative, it is obvious something is fishy.

    Crude oil theft is a significant challenge in Nigeria, and tackling it requires a systematic and bespoke approach involving various stakeholders. We need to articulate some strategies to address this economic malady. Recognising that addressing crude oil theft requires a multi-faceted and sustained effort involving government agencies, law enforcement, communities, and international partners is crucial. Combining these strategies with continuous monitoring, evaluation, and adaptation of approaches can significantly reduce crude oil theft in Nigeria. Some of these strategies are in place now, but their functionality could be better since they have not eradicated the scourge of oil theft in Nigeria. Efficient and effective implementation is a crucial success factor.

    Activities such as enhancing security measures in oil-producing regions are crucial. This includes increasing patrols, establishing dedicated security forces, and deploying technology such as surveillance systems and drones to monitor pipelines and oil infrastructure. Cooperation between the Nigerian Navy, NIMASA, the Nigerian Police, and other security agencies is essential to combat oil theft effectively. Besides, engaging with local communities in oil-producing regions is vital for addressing the root causes of crude oil theft. It is essential to create awareness about the negative impacts of oil theft on the environment, economy, and local livelihoods. Encouraging community members to report suspicious activities and offering alternative sources of income can help reduce the incentive for involvement in oil theft.

    Also, protecting pipelines from tampering and illegal tapping is crucial. Implementing technologies like pipeline monitoring systems, pressure sensors, and leak detection systems can help promptly identify and respond to unauthorised activities. Regular inspections and maintenance of pipelines are necessary to ensure their integrity and reduce vulnerabilities.

    Furthermore, strengthening legal frameworks and imposing stricter penalties for oil theft can act as a deterrent. Enforcing existing laws and regulations effectively, prosecuting perpetrators, and confiscating assets obtained through illegal activities can help combat oil theft. Also, enhancing governance and promoting transparency in the oil sector is essential to tackle oil theft. Implementing measures to curb corruption, improve revenue management, and ensure accountability in the oil industry can help reduce opportunities for theft and illegal activities.

    Collaboration is key to effectively addressing crude oil theft in Nigeria. Collaborating with international partners to address the transnational nature of oil theft is crucial. Sharing intelligence, best practices, and technical expertise can help Nigeria in its efforts to combat oil theft. Cooperation with neighbouring countries to prevent smuggling and illegally exporting stolen oil is also important. Collaboration between oil companies operating in Nigeria and relevant industry associations is essential. These entities can share information and collaborate on security measures, technology implementation, and best practices to protect oil infrastructure. Cooperation can include exchanging information on suspicious activities and joint initiatives to address oil theft.

    Besides, collaboration with technology providers specialising in pipeline security, surveillance systems, and monitoring technologies can significantly enhance efforts to tackle crude oil theft.

    Finally, collaborating with financial institutions can help track and disrupt the financial networks associated with crude oil theft. Sharing information on suspicious transactions, implementing stricter financial controls, and working together to freeze and seize assets obtained through illegal activities can undermine the profitability of oil theft operations.

    Establishing platforms for regular communication, coordination, and information sharing among these collaborating entities is important.

    It is important to reiterate that strategies and actions of the past have not worked, and this new administration must desist from following them. Now is the time for a new bold approach to tackling the menace of crude theft. The systems that allow such impunity are entrenched and will be difficult to uproot. This calls for a deliberate intervention from Nigeria’s highest point of leadership. The President must send a clear message that he will not accept the stealing of even a drop of our crude oil, and those behind such atrocity must stop or face the wrath of the law no matter how highly placed they are. It is a national embarrassment for news of crude oil theft to pervade the local and international space. Nigeria must protect its resources at all costs.

  • VIDEO: Nigeria to destroy 800,000 litres stolen crude despite refinery plans, high petrol prices

    VIDEO: Nigeria to destroy 800,000 litres stolen crude despite refinery plans, high petrol prices

    Nigeria’s state-owned oil firm, NNPC Ltd, has announced that an intercepted 800,000-litre vessel carrying suspected stolen crude oil off the coast of Cameroon will be destroyed as a deterrent to oil theft.

    Chief Corporate Communications Officer, NNPCL Garba Muhammad, said in a statement on Monday, that the oil was stolen from a well in south western Ondo state.

    The vessel named MT Tura II with IMO number: 6620462 owned by Holab Maritime Services Limited, a locally registered Nigerian company, was intercepted on July 7, by Tantita Security Services, a private security outfit owned by former Niger-Delta militant Government Ekpemupolo alias Tompolo.

    According to the NNPCL spokesperson, the suspicious vessel did not possess valid documentation for the oil cargo when it was apprehended.

    “The illegal trade of stolen crude oil not only inflicts significant economic losses on Nigeria and legitimate stakeholders in the oil industry, but also perpetuates a cycle of corruption, environmental devastation, and social instability.

    “Destroying vessels involved in transporting stolen crude oil is of paramount importance as a strong deterrent,” Muhammad said.

    This comes at a time when Nigeria has invested over N11.35 trillion ($25 billion) in the past decade to revive its three moribund refineries, which are currently operating at less than 30 per cent capacity, resulting in a shortage of locally refined petroleum products.

    While the move aims to deter oil theft and enforce stronger penalties, it could potentially exacerbate the challenges faced by the Nigerian energy sector.

    The low production capacity, coupled with the removal of fuel subsidies, has led to a significant increase in petrol prices, with rates soaring as high as N557 ($1.21) per litre, up from N189.

    The federal government had initially announced that the Port Harcourt Refinery would resume operations by the end of the first quarter of 2023, after failing to meet the initial December 2022 deadline.

    However, further delays have occurred and as the third quarter begins, the refinery is yet to commence operations. Some modular refineries, such as the Waltersmith and Duport refineries, where NNPC holds a 30 per cent stake, are also scheduled to start operations this year.

    The operational success of these refineries, alongside the Dangote refinery’s 650,000-barrel-per-day capacity, is expected to significantly reduce Nigeria’s dependence on imported petroleum products, stabilise petrol prices and ensure energy security for Nigeria.

    But theft from pipelines and wells in the Niger Delta has remained a significant challenge to Nigeria’s oil output in recent years and is one of the biggest obstacles facing President Bola Tinubu.

    According to NNPCL, preliminary investigations revealed that the recently intercepted vessel had been operating in stealth mode for the past 12 years, with its last reported location being Tin Can Port in July 2011.

    The company said it had escalated the details of the arrest and investigation outcomes to the appropriate government authorities and assured Nigerians that the fight against crude oil theft would continue until it is completely eradicated.

    Despite ongoing efforts to combat oil theft, the interception of the vessel underscores the persistent challenges Nigeria faces in addressing this issue.

    Watch Video:

     

  • Petroleum Ministry, NUPRC differ on crude oil loss in Nigeria

    Petroleum Ministry, NUPRC differ on crude oil loss in Nigeria

    The Minister of State for Petroleum Resources, Chief Timipre Sylva has attributed the loss of revenue from crude production to theft, pipeline vandalism and decayed infrastructure.

    The minister, in a statement on Monday by his Senior Adviser, Media and Communications, Horatius Egua said in spite of the challenges, the Federal Government was determined to end the trend.

    Sylva said the Federal Government was determined to end the trend through improved investments and security along the major oil and gas pipelines in the Niger Delta region.

    Recall the Chief Executive of the Nigerian Upstream Regulatory Commission (NUPRC), Engr Gbenga Komolafe had attributed approximately 40% of the volumes credited to crude losses in the Nigerian petroleum industry to measurement inaccuracies and not theft as often reported.

    However, according to Sylva, contrary to the position of NUPRC, the major sources of crude oil losses were theft, pipeline vandalism and production deferment as a result of pipeline non-availability.

    “It is a known fact that the major losses of crude oil in the country have been through theft and destruction of oil pipelines.

    “Again, we also know that some of the oil infrastructure are old and decayed and cannot perform at maximum capacity.

    “And there is also the issue of lack of investments in fossil fuel in the country and the drive towards renewable energy has really hampered new investements in this sector,” he said.

    The minister said the government had put measures in place to restore sanity in the sector.

    He added that contrary to the report, the problem associated with crude oil losses are systemic issues that the government was already handling with a view to finding permanently solutions to.

    Sylva, therefore, urged the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to harmoniously work together.

    This, he said, would ensure that the constraints and impeding challenges in the optimal crude oil production volume were speedily addressed to boost national revenue.

    According to him, the Federal Government cannot continue to lose revenue through perceived lapses in crude oil production, especially at this very critical period of scarce revenue for the nation.

    The minister said that this was not the time to dwell on the mistakes of the past or engaged in needless blame games but a time to work to close all existing leakages to enable government get maximum benefits from its crude oil and gas assets.

    While expressing satisfaction at the improved security along the major oil pipelines in the region, Sylva called for sustained efforts by all concerned to maintain maximum crude oil production.

    “We are very confident that Nigeria will achieve two million barrel per day crude oil production target very soon.

    “The government is doing everything possible to get to where we should be and everyone is working hard to achieve this,” the minister said.

  • 40% of crude loses due to measurement inaccuracies – NUPRC

    40% of crude loses due to measurement inaccuracies – NUPRC

    Approximately 40% of the volumes credited to crude losses in the Nigerian petroleum industry are actually attributable to measurement inaccuracies and not theft as often reported.

    The Chief Executive of the Nigerian Upstream Regulatory Commission (NUPRC), Engr Gbenga Komolafe 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. 

    Delivering a speech on “Nigerian upstream petroleum sector: value optimization, energy transition and regulatory perspectives”, Engr. Komolafe said the Commission is committed to dealing with the issue of metering errors by ensuring that Original Equipment Manufacturers (OEMs) 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. 

    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. 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.

    Currently, Nigeria is flaring about 10% of gas produced, a feature the Commission is also determined to eliminate through the on-going Gas Flare Commercialization Programme (GFCP). Nigeria produces about 8BSCF/D of gas, out of which approximately 20% is delivered to the domestic market, approximately 40% is exported to international markets, 30% is utilised for producer’s internal consumption and the excess gas is flared.

    In alignment with our objectives, as outline in Section 6 of the Petroleum Industry Act, the Commission is diligently pursuing the basic regulatory goals which include: increasing Nigeria’s oil and gas reserves and production, developing a transparent approach to hydrocarbon accounting, and attaining operational efficiency and effectiveness in industry operations. 

    In addition, the Commission is committed to facilitating peace and harmony in the host communities to guarantee conducive operating environment for investors, positively impacting on operating cost and attracting more investment opportunities. Komolafe outlined the measures undertaken by the Commission. Excerpts:

    Strategic Actions for Hydrocarbon Value Optimization

    In keeping with industry laws and regulations, the Commission has issued a licensing round guideline and published a licensing round plan for a total of seven open blocks (300-DO, 301-DO, 302-DO, 303-DO, 304-DO, 305-DO & 306-DO). We are currently evaluating the Expression of Interest (EOI) received from prospective investors. The exercise is indeed expected to be a huge success for Nigeria and a big step towards growing the nation’s oil and gas reserves. This will be done through aggressive exploration and development efforts. 

    Also, as part of our strategy for value optimization and increased production from our national oil and gas reserves, the Commission has focused on regulatory initiative aimed at reviving declining wells through enhanced oil recovery approach. We are working with operators to identify candidate wells and appropriate interventions that would lead to increased production.

    In addition, the Commission is focusing on shut-in wells which can be revived. In pursuance of this, The Commission inaugurated a committee on June 23, 2022, to conduct industry-wide study on reactivation of Shut-in strings. The committee has submitted its report, and includes recommendations categorised into Quick Wins, Medium and Long-Term initiatives that will enhance national oil and gas production volumes.

    Findings from the report revealed that over 900,000 barrels of oil per day can be earned from the quick win interventions while the medium and long-term initiatives could potentially add 1.2 million barrels of oil per day if properly and fully implemented. The total number of strings that need to be revived is also known and we have commenced engagement with the relevant operators to operationalize the initiative.

    We have also completed the 2020 Marginal Field Bid Round and issued fifty (50) Petroleum Prospecting Licenses (PPLs) to deserving awardees. It is expected that with the existing discoveries in the awarded fields, early Field Development Plan (FDP) would be pursued by the awardees leading to incremental oil and gas production. On its part, the Commission is facilitating timely approvals for expedited re-entry and early production. The estimated incremental production from the awarded fields is approximately 58,000 bpd and 87mmscf/d.

    In the short/medium term, we expect an estimated incremental volume of 461,000bpd and 565mmscf/d from new wells and well re-entry. In the long term we expect an estimated incremental volume of 162,000bpd and 868mmscf/d from FDPs which have been approved and are at various stages of execution.

    Implementation of Host Community Provisions under Section 235 of PIA

    Section 235 of the PIA 2021 saddles the Commission with the responsibility of ensuring conducive and peaceful relationship among stakeholders within the Host Community through the implementation of the Host Communities Development Trust.

    The Commission, in collaboration with the relevant stakeholders, has developed templates and gazetted regulations, which includes that of the Host Community Development Trust (HCDT). The essence of the HCDT is to integrate oil bearing communities into the value chain and effectively cater for the development needs of impacted communities, thus positively curbing restiveness in such communities and offering enabling environment for operators to thrive. This is expected to guarantee seamless operation, boost investor confidence, and provide enabling environment for sustainable development of the country’s hydrocarbon resources. We are happy to disclose that over 60 Host Community Development Trust have been approved by the Commission. This is indeed a milestone in the implementation of the PIA, 2021.

    FDP Budget, Cost Monitoring and Benchmarking

    Our strategic thrust is to ensure that all our interventions as regulator translate into significant reduction in the cost of doing business in the upstream petroleum industry. In addition to these measures, Section 8 of the petroleum act mandates the Commission to undertake the commercial regulation of the operations of the industry as well as develop cost studies and benchmarks for the evaluation of upstream petroleum operations.

    The focus on cost reduction as it relates to unit operating cost (UOC) stems from a comparative analysis of other jurisdictions, with a view to determining where we want to be. Our current UOC ranges from $15 (deep offshore) to $25 (onshore/shallow waters). It is obvious that Nigeria needs to improve its cost efficiency.

    Development of priority regulations as tool for sanity and predictability – Section 216

    The Commission is committed to creating enabling and predictable regulatory environment via the development of regulations that will give meaning and intent to the PIA 2021. In view of that, some priority regulations for the upstream petroleum sector have been developed by the Commission within its short existence. The Act also provides for a consultative forum to be held for the concurrence and input from all stakeholders in the upstream petroleum operations before the finalization of regulations. Five (5) of the regulations have been completed and gazetted while thirteen (13) other draft regulations have been reviewed with stakeholders and awaiting gazetting.

    INITIATIVES TO ENHANCE GAS PRODUCTION

    In line with the Federal Government’s declaration of the period 2021 – 2030 as the Decade of Gas, the Commission is taking steps to expand and develop the Nation’s huge gas resources through enhanced gas exploration, development and utilization schemes. This will ultimately lead to gas reserves’ growth, increased gas production, maturation of domestic and export gas market, as well as gas flare elimination.

    Furthermore, in the face of the global energy transition and the need for cleaner sources of energy, gas is being positioned as our immediate transition fuel to lower the Nation’s carbon emission footprint in line with our climate change commitment.

    Climate action plan in FDPs and operations

    Our commitment to the various climate agreements places a demand on us all to keep global temperature rise within 1.5 °C – 2.0 °C of pre-industrial levels. The implication of this for Nigeria’s oil and gas industry are far-reaching. The need to decarbonise our production facilities not only requires the right policy direction but also demands adequate measurement of all greenhouse gas (GHG) emissions to ensure we achieve our net-zero target by 2060.

    The Commission supported the review and assessment of the national GHG emissions as part of series of workshops that led to revision of the Nationally Determined Contributions (NDCs) policy submitted to the United Nations Framework Convention on Climate Change (UNFCCC) ahead of the 26th Conference of Parties (COP26) summit in Glasgow, Scotland 2021. Fugitive methane emission reduction target (60%) from Oil & Gas was added to Nigeria’s NDC for the first time based on robust data provided by the NUPRC.

    The development of guidelines on the management of fugitive methane and GHG emissions in the upstream sector that will drive emission reduction and mitigations targets of the National Determined Contributions (NDCs) has been approved and is being operationalized. The Commission is currently engaging the International Finance Corporation (IFC) on opportunities surrounding Carbon Capture Utilisation and Storage and development of national framework on CCUS.

    We look forward to a more collaborative working relationship with the operators in the industry for value optimization. Such collaborative aspirations would target unlocking the huge potentials we have as a nation in the Deep Play prospects, Frontier Basins and the Deep Offshore environments.

    We would also be leveraging on technology to achieve our mandates by ensuring all our processes become fully automated and more transparent in line with the prescriptions of the PIA. Furthermore, relevant guidelines that will provide clarity on every aspect of oil and gas operations will be issued by the Commission in keeping with our core values.

    Signed:

    Engr. Gbenga Komolafe, FNSE

    Commission Chief Executive

    February 17, 2023

  • FG orders security forces to end oil theft before May 29

    FG orders security forces to end oil theft before May 29

    The federal government has charged security agencies to end crude oil theft before the end of President Muhammadu Buhari’s administration on May 29.

    TheNewsGuru.com (TNG) reports Minister of State for Petroleum Resources, Timipre Sylva made the disclosure while addressing troops under Operation Delta Safe during his operational visit to military formations in Port Harcourt on Thursday.

    The minister visited Nigeria Air Force 97 Special Operations Group and Nigeria Navy Ship Pathfinder to re-assess the ongoing fight against oil theft.

    The minister said that the president was committed to total eradication of oil theft before leaving office on May 29.

    He said: “We were here a few months ago with a charge and mandate from President Buhari to ensure complete eradication of oil theft in the Niger Delta.

    “Since then, we have seen a significant improvement, meaning that you (military and other security outfits) took the charge and mandate of the president very seriously.

    “Therefore, Mr. President sent us here with a message of commendation to you for your gallantry in the fight against oil theft,” he said.

    Silva said that Buhari had declared total war against those stealing national assets, thereby depriving the people of the benefits of such assets.

    He commended the Armed Forces and other security outfits for the reduction in crude oil theft and illegal bunkering in the country.

    “I am happy to announce that there is significant improvement in crude oil production, with both Nigerians and the international community acknowledging the improvement.

    “However, we should not rest on our oars but we must ensure that stealing of crude oil is 100 per cent eradicated in the country.

    “So, we urge you to redouble your efforts in completing the job of ending oil theft in the Niger Delta,” the minister said.

    Also speaking, Chief of Defence Staff, Gen. Lucky Irabor, attributed the increased oil production and export to the sustained fight by the military and sister security agencies, with support from the government.

    He said that before the president gave the military the marching order to tackle crude oil theft, production was very low.

    “Currently, crude oil theft is on a steady decline, indicating that we are on the right path.

    “The reduction also indicates that there is the need for everyone to put their hands on the plough through collective efforts,” added.

    On his part, Chief of Naval Staff, Vice Adm. Awwal Gambo, attributed the crude oil theft reduction to improved synergy between the navy and sister security agencies.

    He said that the recent arrest of a foreign merchant ship, MT Heroic Idun, suspected to be involved in crude oil theft showed was an indication that the fight against oil theft was real.

    “The arrest of MT Heroic Idun will serve as deterrent to those who are stealing our crude.

    “On Jan. 10, the vessel and its crew will be arraigned at the High Court here in Port Harcourt,” he disclosed.

  • FG blames crude oil theft on worsening unemployment situation

    FG blames crude oil theft on worsening unemployment situation

    The Federal Government has attributed the menace of crude oil theft to the worsening unemployment situation in the country.

    Dr Chris Ngige, the Minister of Labour and Employment, said this while declaring open the 8th Meeting of the National Employment Council on Friday in Abuja.

    Mr Olajide Oshundun, the Head, Press and Public Relations, quoted the minister as saying this in

    Ngige, who is the chairman of the council, said that oil theft has made Nigeria to become a mendicant nation, resorting to begging for survival.

    According to him, this menace has hampered the efforts of the federal government towards creating jobs for the country’s teeming youthful population.

    “I am aware that you people know that we are at a very critical stage in our nation’s life. We have economic problems all over the world, but our own in Nigeria is self inflicted. Our main source of revenue is oil.

    “But, in the oil sector, two things are happening. One, Nigeria is not meeting her production quota. Our OPEC production quota used to be 2.2 million barrels per day. It slipped down to 1.8 million barrels.

    “Now, we cannot even produce the 1.8 million barrels. We are hovering around 1.1 million barrels per day, and they told us that some people are stealing our crude oil.

    “This is a very serious matter because it has made us become very mendicant. We are now a mendicant nation, resorting to begging for survival,’’ he said.

    He added that the nation cannot continue that way because it has hampered efforts to create jobs for our teeming youthful population.

    The minister further said: “Some people were analysing the situation and said that when we started the country, the white men came here and took all the jobs.

    “ We were seeing them with white shirts and ties and the jobs became known as white collar jobs. Later, our own people started going to university and after graduation, joined in the ‘white collar jobs’.

    “Our colonial masters left and bequeathed to us another group of colonial masters, which comprised the indigenous people.

    `Those who took over from the colonial masters did not plan for tomorrow. Number one is that our population is growing uncontrollably.

    “Our population astronomically outpaces our Gross Domestic Product (GDP). We are neither finding our youthful population white collar jobs, nor making arrangement for them to do the blue collar jobs.

    “Blue collar jobs are the ones you do with your hands, applying skills,’’ he said.

    Ngige also noted that only few blue-collar jobs were created in the transport sector, especially in rail and maritime, without producing indirect jobs to complement them, while the situation was made worse by foreigners.

    He added that this was especially Chinese and other West African people who have taken over most of the blue collar jobs.

    He also blamed the overflowing joblessness for the youth restiveness all over the country.

    “Unemployment is not confined to Nigeria, but our own is worse because in other climes, people are earning money from blue collar jobs. Here, we have no blue collar jobs for our workforce.

    “We have polytechnics but they are competing with universities for degrees. We see a polytechnic say it is awarding degree. We have technical colleges that want to equate their certificate with a degree.

    “Nobody is interested in having technical skills. Everybody wants to be drawing and designing in air-conditioned offices, which is what the degree man does. The degree men are not supposed to be the implementers.

    “ The field implementers are the technologists and technicians and in proper climes, they are very well paid and live decent lives,’’ he said.

    According to him, to reverse this ugly trend, there is need for a handshake between the National Employment Council and the National Skills Council, which is domiciled in both the Federal Ministry of Labour and Ministry Education.

    He said this also comprised the ministries of Industries and Trade, Works, Power, Science and Technology, and all other government creations, with a sense of urgency.

    Ngige therefore recommended the incorporation of the Federal Ministry of Communication and Digital Economy into the National Employment Council, being that we are in a digital age which made for the creation of digital jobs.

    He described digital jobs as the best way to absolve the bulging mass of youths that are now unemployed.

    “We need to also look at NNPC and gas pipeline projects. Nigeria is doing two projects now, the Abuja-Kaduna-Kano (AKK) and the one that transverses the West African Line into Morocco and extending to Europe.

    “So, these are all ongoing critical infrastructure projects with large quantum of jobs to be created from them,’’ he said.

    He welcomed the proposal for the creation of labour desks in form of job synergy points in the ministries, departments and agencies where needed in order to facilitate job monitoring and creation.

    “We conceived concept of labour desks for trade disputes and that was why we started in the ministries and agencies that have propensity for a lot of trade disputes.

    “Now, that this Employment Council is thinking ahead, you should also bring a proposal so that we can do reforms through the Ministry of Labour.

    `This will ensure to have job creation contents in conjunction with the trade dispute aspect, in addition to managing strike actions,’’ he said.

  • 16 foreigners arraigned in Nigeria for oil theft

    16 foreigners arraigned in Nigeria for oil theft

    About 16 foreigners have been arraigned by the Federal High Court sitting in Port Harcourt, Rivers State, for offences bordering on conspiracy, stealing, attempt to deal in crude oil and false pretences.

    These foreign nationals were caught onboard a vessel, MT Heroic Idun by a combined effort of Equatorial Guinea Navy  and Nigerian Navy army.

    The foreigners had in August 2022 at the Akpo Oilfield in Rivers State, conspired among themselves and committed maritime offences.

    The charges contravenes  Section 10 of the Suppression of Piracy and Other Maritime Offences Act 2019.

    Although, the accused have pleaded not guilty to the crime.

    After listening to the application of the prosecutors on the amended charges, the trial judge, Justice Turaki Muhammed, ordered that the accused be remanded to enable 10 other suspects remaining to be brought to court to take their pleas.

    Before adjourning the matter to the 15th of November, Justice Muhammed advised that the accused  be allowed to see their lawyers and allowed to get medical attention if need be.

    About 26 persons were said to be onboard the MT Heroic Idun crude oil vessel at the Akpo Oilfield within the Rivers State waters when it was intercepted on August 7, 2022 by the Nigerian Navy.

    A Navy surveillance facility was said to have tracked and updated the Equatorial Guinea Navy on the location of the vessel, currently being held at the Luba Anchorage in Bioko Island, Equatorial Guinea.

    Captain of the vessel, Metha Tanuj, shortly after the court appearance, told newsmen how they came into Nigeria.

    He said, “We came into Nigeria on 8 August. We had some misunderstandings relating to our documents which were supposed to be filed by the ship’s agent.

    “In the night, we had an incident with a vessel which we didn’t know at the time as the Nigerian Navy. As a company, we managed to take all actions as advised by our higher authorities.”

    Tanuju admitted that they were first arrested by the Equatorial Guinea Navy Ship.

    “We arrived Equatorial Guinea and were there until we were handed over to the Nigerian Navy,” he added.