Nigeria loses N471bn to pipeline vandalism in 5 years—NEITI

NEITI has said Nigeria recorded 7,143 pipeline vandalism cases in 5 years resulting in N471 billion spent on repairs.

This is according to Dr. Ogbonnaya Orji, the Executive Secretary of the Nigerian Extractives Industries Transparency Initiative (NEITI).

Dr. Orji said this while delivering a keynote address on pipeline security, oil theft and the implications for economic growth at the ongoing 2023 International Pipeline Technology and Security Conference being held in Abuja.

According to him, in the last 5 years, between 2017 and 2021, Nigeria recorded 7,143 cases of pipeline breakages and deliberate vandalization resulting in crude theft and product losses of 208.639 million barrels valued at $12.74 million or N4.325 trillion.

During the same period Nigeria spent N471. 493 billion to either repair or maintain pipelines.

He also noted that NEITI has put in the public domain empirical data of oil theft and losses at 619.7 million barrels of crude, valued at $46.16 billion or N16.25 trillion between 2009 and 2020.

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He stated further that Nigeria lost 4.2 billion litres of petroleum products from refineries, valued at $1.84 billion at the rate of 140,000 barrels per day, from 2009 to 2018.

So, the total value of crude losses between 2009 and 2020 is higher than the size of the country’s foreign reserves and almost ten times Nigeria’s oil savings in the Excess Crude Account.

He also said that crude oil theft in Nigeria is perpetrated mainly through pipeline clamping and four other ways.

According to him, NEITI’s Reports over the years, and recent insights from their membership of the Special Investigative Panel on Oil Theft and Losses, have made them understand that oil theft is perpetrated mainly through pipeline clamping, as well as:

“From NEITI’s 2021 Oil and Gas Industry Report released recently, the sector accounted for 72.26% of Nigeria’s total export and Government’s foreign exchange, 40.55% of government revenue, and provided 19,171 jobs.

“It is not a matter of debate that despite the strategic contributions, the country is yet to derive optimal benefits from its oil and gas resources due to oil theft and losses through pipeline vandalism, pipeline integrity compromise, outright sabotage, and general insecurity in the region.”

Dr. Orji highlighted the critical need to address oil theft and pipeline vandalism, stating that doing so is vital for rebuilding trust in the industry, reinstating investor confidence, and supporting economic growth.

He emphasized that oil theft and losses in Nigeria have escalated to a national emergency, posing a significant threat to oil exploration and exploitation.