The Action Congress of Nigeria (ACN) has warned that the rising cases of crude oil theft and pipeline vandalism in the Niger Delta will definitely worsen the country’s economic woes, when placed side by side with other problems besetting the country’s troubled oil sector, unless the Federal Government acts decisively to stop the criminal act.
In a statement issued in Lagos on Sunday by its National Publicity Secretary, Lai Mohammed, the party said oil theft and pipeline vandalism, the cost of which has been put between 6 and 12 billion US dollars per annum, have now reverted to the pre-amnesty period, when oil theft peaked at about 350,000 barrels of per day – higher than the quantity of oil produced daily by Gabon or Equatorial Guinea.
”On Feb. 24th 2013, we raised the alarm that the country’s economy was heading for the rocks, citing the skyrocketing cost of oil production, from 4 dollars per barrel in 2002 to 35 dollars per barrel presently; the massive corruption in the oil sector; the sharp fall in the discovery of new oil and gas reserves due to the low investment in the sector, and the challenge posed by alternative sources of global supply of oil and gas.
”For raising that alarm, we were pilloried by those who acted more out of emotion than facts. Today, we say the situation is actually worse than we had thought, exacerbated by pipeline vandalism and crude oil theft which have reached an unsustainable level. Add this to the resurgence of attacks by the Movement for the Emancipation of the Niger Delta (MEND), and we are compelled to cry out again,” it said.
ACN said the action taken in recent times by two major oil companies, Shell Petroleum Development Company (SPDC) and Nigerian Agip Oil Company (NAOC), is the clearest indication yet of the seriousness of the situation.
”In March 2013, SPDC announced that it will shut down the 150,000bpd Nembe Creek oil pipeline this April due to the urgent need to clear away illegal connections meant to facilitate the theft of crude oil from the pipeline. Also in March, NAOC declared a force majeure regarding crude oil liftings at the Brass terminal and suspended its activities in Bayelsa State, following the intensification of illegal bunkering activities and the vandalisation of the 10” Kwale-Akri-Nembe-Brass oil delivery line.
”The shutdown of these two key oil delivery trunk lines by SPDC and NAOC has cut nearly 300,000 barrels per day from already dwindling Nigeria’s oil output, now put at 2.2 million barrels per day, down from 2.75 million barrels per day a year ago, resulting from increased, organised and sophisticated illegal bunkering of oil by criminals operating in the creeks of the Niger Delta.
”To worsen matters, it has been alleged that some bad eggs in the military Joint Task Force (JTF) deployed to the region to protect oil personnel and facilities have been accused of complicity in the illegal bunkering activities. This is why the Federal Government must quickly engage key stakeholders in a dialogue with a view to finding ways to stop the criminal act before it cripples the economy and brings Nigeria down to its knees,” the party said.
ACN said it is particularly worrisome that the relative peace witnessed in the Niger Delta following the amnesty programme for oil militants seems to have waned, going by available statistics: A total of 350,000 barrels per day was lost to illegal bunkering in the Niger Delta in 2012, representing an increase of 45% over the figure for 2011 and 67% over that of 2010. It added that the trend for 2013 is alarming.
”We are particularly concerned that the Nembe Creek axis seems to have been the worst hit by the criminal act, despite being the operating base of a key former militant who has cornered a lucrative Federal Government contract to protect Nigeria’s coastline from the same bunkering activities that are now getting out of control,” the party said.
It said that without prejudice to whatever solutions that key stakeholders may proffer to the criminal act of pipeline vandalism and oil theft, it is important for the security agencies operating in the Niger Delta to ginger up their efforts to safeguard lives and property in the Niger Delta; and the government must recommit itself to enhancing security of investment in the region, while at the same time tackling headlong the grinding poverty in the oil region.