Nigeria to lose US$ 4.5 bn to crude oil thieves
By Yemie Adeoye
IF activities of pipeline vandals in the country fails to get the urgent national attention it requires the nation stands the risk of losing about N711,472,755,840 (US$ 4, 554,883, 200) being the annual cost for 140,000 barrels of crude oil daily as activities of crude oil thieves in the country have continue to rise astronomically.
The Shell Petroleum Development Company of Nigeria Ltd (SPDC) which raised an alarm on the potential effects of increased crude theft activities on the new Nembe Creek Trunkline (NCTL), barely 16 months after the old line was replaced due to repeated sabotage attacks said that on the 24th of December 2011, the line was shut down because of leaks caused by two failed bunkering points, and since repairs were completed, more than 50 theft valves have been discovered, even as some 17 illegal bunkering points were found within a distance of 3.8km.
Current daily output of the line is 140,000 barrels from SPDC and third party production which is transported for export at Bonny Terminal and this daily output currently stands the risk of being shut-in as it is becoming less business worthy due to these activities.
SPDC Managing Director Mutiu Sumonu said yesterday in Portharcourt that the level of crude theft at NCTL can no longer be tolerated, “There has been multiple facility trips caused by pressure drops resulting from illegal off-take.
This is more than Nigeria losing money from lost production, costly repairs and clean-up and facility downtime. It is a sad story of consistent pollution of farm lands and rivers by people who are not bothered by the effects of their actions on the environment.”
The line was replaced with a new line between 2007 and 2010 due to integrity issues from militancy attacks. Some 70,000 barrels of oil per day was deferred in the December leak which took a month to repair because of the swampy terrain.
Apparently, the crude thieves took advantage of the repair window to install more bunkering points and fix hoses to take crude to sea vessels and illegal refineries. The vessels transport the stolen crude to waiting mother-ships while the refined product is sold locally.
Helicopter over-flights yesterday (February 6, 2012) confirmed thriving crude theft activities at Tora Manifold, Santa Barbara River, SEGO Manfiold, Awoba, Krakrama, Bille, Cawthorne Channel and Alakiri all in Rivers and Bayelsa states. Some other connections were made directly to wellheads.
Mr. Sunmonu said: “It is difficult to sustain production in the circumstance as we have to shut down when a facility trips and fix the cause before restarting. This happened three times just between the 26th and 30th of January. We have increased surveillance of the route so we can detect crude theft activities and respond early to spills, but what is urgently needed is robust intervention at federal, state and local government levels.
We need increased patrols of creeks and waterways, removal of illegal off-take points and dismantling of illegal refineries.”
More than 75 percent of all oil spill incidents and more than 70 pecent of all oil spilled from SPDC facilities in the Niger Delta between 2006 and 2010 were caused by sabotage, theft and illegal refining.