Crude oil theft: The task ahead for Sylva by Ebuka Nwankwo

The Nigerian Navy says it arrested 57 sailors –all-male sailors, including a Ukrainian, a Mexican and 55 Nigerians – and impounded their vessels between Aug. 11 and Aug. 25, 2019 for allegedly smuggling crude oil and illegally refining diesel.
This news came a few hours after the Nigerian National Petroleum Company (NNPC) announced that the country lost over 22 million barrels of oil to theft in the first half of this year. This amounts to 120,000 barrels per day (bpd). This figure suggests that crude oil theft in Nigeria is a multi-billion-dollar business and a financial drain to the country.


The level of theft announced by the NNPC could be doubled by the end of the year, according to Governor Godwin Obaseki, chairman of the ad-hoc Committee of the National Economic Council on Crude Oil Theft, Prevention and Control.


Oil theft has been a big drain on the country’s revenue. In 2016, according to the former minister of Petroleum, Ibe Kachikwu, Nigeria lost 3.8 trillion naira as a result of oil theft and vandalism.  Apart from these financial losses, spillages from pipeline vandalism are serious concerns to the environment.


In a bid to curb this menace with technology, Ibe Kachikwu, unveiled a couple of computerized Crude Oil, Liquefied Natural Gas (LNG) and downstream tracking systems last January.


But with the latest news on crude oil theft, there is no doubt that more work needs to be done in this space. Technology alone might not stop this menace. The current Minister of State for Petroleum, Timipre Sylva, needs to make his mark in this space.


Slyva needs to put on his thinking cap and be ready to step on toes. With this level of theft, it is difficult to rule out high level collaborations in this illegal business. In fact, many analysts believe that there are godfathers, who are able to exert considerable influence over the executive and security forces, spearheading this illegal business. In fact, there have even been cases where members of the security forces have been dismissed and charged in relation to their complicity in illegal bunkering activities and in the disappearance of impounded vessels.


Many experts have argued that the establishment of modular refineries would help curb pipeline vandalism and crude theft. They argue that if these illegal refineries, which are littered all over the Niger Delta,are regulated and monitored by government, crude oil theft would be reduced. This is one area the minister needs to look into.


The minister has to consider developing a robust strategy fora real-time technology-based pipeline surveillance architecture in the country. This obviously goes beyond the award of pipeline surveillance contracts to big names.


The good news is that Sylva is not new to the petroleum industry. The former governor served as a Senior Special Assistant to the then Minister of State for Energy, Petroleum Resources, Edmund Daukoru, between July 2005 and May 2007.


Former governor Slyva has every opportunity to write his name in gold. He could borrow a leaf from Dora Akunyili’s strategy while she was the Director General of NAFDAC.