Nigeria Loses N556bn To Oil Vandalism In 3 Months
By Sunday Elom
Nigerian National Petroleum Company (NNPC) has said that the country lost crude oil valued at about N556billion between August and October, 2021 to pipeline vandalism, community interferences, sabotage of oil facilities, etc.
A recent report by the Crude Oil Marketing Division (COMD) stated that Nigeria consistently posted losses in August, September and October.
The report for the period under review shows that the average costs of a barrel of Brent, the crude against which Nigeria’s oil is priced, were $70.75, $74.49 and $83.54 respectively.
A breakdown of the loses by the NNPC report showed that crude oil volumes lost due to various production shut-ins caused by vandalism, sabotage and other challenges in August, September and October, 2021 were 6,680,620 barrels; 6,362,700 barrels and 4,824,946 barrels respectively.
Calculating the monetary value of the volume of crude oil lost at the official exchange rate of N411.95 per dollar, Nigeria therefore lost N194.71billon in August, N195.246billion in September and N166.05billion in October. The sum total of these monthly gives a total of about N556billion the country lost in three months.
However, further analysis of the NNPC latest reports showed that about 20 incidents led to the loss of the 6,680,620 barrels of crude oil recorded in August. Eight crude oil terminals in the country: Forcados, Sea Eagle, Brass, Yoho, Qua Iboe, Escravos, Ajapa and Otakikpo were affected in August, thus, production was reduced at those facilities.
According to NNPC explanation of some of the incidents that curtailed production in one of the terminals, “Energia (an oil firm) injection into Brass line (was) suspended due to pipeline damage. Pillar injection into Brass (was) suspended due to third party interferences on Nigeria A grip Oil Company (NAOC) Akiri pipeline.”
It was observed that 18 incidents led to the loss of 6,362,700 barrels of crude oil following production shut-ins recorded in the month of September.
The report showed that a total of nine terminals including Forcados, Sea Eagle, Brass, Yoho, Qua Iboe, Escravos, Urha, Ajapa and Otakikpo were affected in September.
NNPC noted that “production (was) curtailed due to pipeline outages” at the Forcados Terminal. It further stated that “Energia injection into Brass line (was) suspended from September 1 to 30, 2021 due to pipeline damage.”
For the month of October, an NNPC report showed that the incidents that led to crude oil production shut-ins were reduced to 11.
However, eight terminals: Forcados, Bonny, Odudu, Brass, Yoho, Urha, Ajapa and Aje were affected resulting in the total loss of 4,824,946 barrels of crude oil recorded in October.
Recall that the Minister of State for Petroleum Resources, Chief Timipre Sylva and the NNPC had repeatedly stated that the government was interfacing with communities in the Niger Delta oil region on the urgency to stop activities that often lead to crude oil losses.
In one of the recently published monthly reports, the Nigeria’s apex oil corporation stated that “The NNPC in collaboration with the local communities and other stakeholders continuously strive to reduce and eventually eliminate this menace.”