Nigeria loses N16.25tn to oil theft –  Speaker Abbas

Nigeria loses N16.25tn to oil theft –  Speaker Abbas

Nigeria lost about $46 billion (N16.25 trillion) to crude oil theft between 2009 and 2020, Speaker of the House of Representatives, Tajudeen Abbas, has said.

The speaker stated this in Abuja on Thursday while inaugurating the ad hoc committee to investigate crude oil theft and loss of revenue.

He said the menace of crude theft had drastically hampered the growth of the country’s oil production, with Nigeria losing between five and 30 per cent of its daily oil production.

He expressed shock that critical agencies in the oil and gas sector had refused to honour the committees’ invitation, adding that the agencies were not doing the nation any good by refusing to appear before the parliament to answer questions on the critical aspect of the economy.

Represented by chairman of the House Committee on Petroleum Upstream, Al Hassan Ado Doguwa, the speaker said if decisive action was not taken to address the issue, the country might be thrown into a deeper fiscal crisis due to dwindling revenue from the oil and gas sector.

Quoting data from the Nigeria Extractive Industries Transparency Initiative, the speaker said Nigeria’s oil production declined from 2.51 million barrels per day in 2005 to 1.77 million barrels per day in 2020.

He said, “NEITI reports also show that 619 million barrels of crude valued at $46 billion were stolen in the period 2009-2020”, adding that “Nigeria has continually failed to meet its daily production quota as set by the Organisation of the Petroleum Exporting Countries, OPEC.”

Abbas explained further that “recently, Nigeria’s OPEC quota was reduced from 1.742 million barrels per day to 1.38 million barrels per day.

”Yet, the country is still struggling to meet this quota as daily production output was 1.184 million barrels per day and 1.249 million barrels per day in May and June 2023 respectively.

“On average, current daily production output is a far cry from the budget assumption of 1.69 million per day. The implication is clearly manifest in the economic crisis that the country is facing.”

He also noted that the nation faced a major fiscal crisis, adding that global recovery from the COVID-19 pandemic and the ongoing war between Russia and Ukraine had continued to cast a cloud of uncertainty on the oil and gas industry in the country.

He said, “While the average international price for Brent crude oil has hovered slightly above the set benchmark price since January, Nigeria’s daily oil production has performed poorly due to a number of reasons.

“It is common knowledge that investment in the oil and gas sector has declined in the past few years, owing to global financing constraints and the overall response to energy transition considerations.

“However, we must agree that the greatest challenge to optimizing crude oil production in Nigeria is the grand scale oil theft that has plagued the sector for the past 2 decades.”