Monday 12 August 2013

Nigeria: Who Will Stop Crude Oil Theft?

This Day (Lagos)

Could the European parliament curb oil theft? It could help but the answer will largely come from within
The European Parliament may soon be demanding from sellers of stolen crude the certificate of origin for their products. This was one of the decisions taken at the meeting of the members of the African, Carebean, Pacific Parliaments and their European Union counterparts at the conclusion of their recent meeting in Abuja. According to Mitchell Rivasi, acting President of ACP-EU, the need to stop the huge loss of Nigeria's oil to thieves necessitated the decision. Said Rivasi: "We want to ban European refineries from buying uncertificated oil. 400,000 barrels a day is a huge loss. We need to get traceability of oil to avoid theft. The oil companies are involved in this and everybody is making big money. The bunkering tankers are better equipped than the Nigerian Navy. This is a huge international organised crime. We did it with diamond; we can also do it with oil".
While it is noteworthy that the international community is paying attention to the monumental loss of Nigeria's prime asset, it would appear that the local authorities seem to have given up on any serious attempts to rein in the criminal gangs. Yet there can be no solution until Nigerians themselves resolve to fight the menace. Last week, the Nigeria Extractive Industries Transparency Initiative (NEITI) disclosed that the nation has lost over 136 million barrels of crude oil estimated at $10.9 billion through pilfering and sabotage between 2009 and 2011. This was one of the findings in the audit report of operations in Nigeria's oil and gas industry, which covered the period under review.
According to the NEITI Chairman, Mr Ledum Mitee, about 10 million barrels of products, valued at $894 million, were also lost to pipeline vandalism in the downstream sector within the same period. Mitee stated further that the figure of losses to crude oil theft by the country represents about 7.7 per cent of the total revenue accrued to the federation account within the period in question.
We find the NEITI disclosure rather troubling even as we call on the federal government to show more commitment in the fight against serious economic crimes which the brazen theft of our crude oil represents. Aside the loss of enormous revenues, the security implications of the criminal activities is better imagined against the background that a huge chunk of the proceeds are used to buy arms.
Indeed, to underscore the gravity of the situation, the Senate recently lent its weight behind those seeking capital punishment for oil thieves if only that would help to redress the problem. According to Senate President David Mark, there is no bigger punishment that could be meted out to oil thieves in Nigeria than capital punishment. Said Mark in the course of discussing the Petroleum Industry Bill (PIB) that is yet to be passed: "The law must serve as deterrent to those that steal our oil or others who plan to stealing our oil. The Bill must also ensure that the current rate of oil theft in the country is minimised to the barest minimum. It seems we are having a bad name internationally because of the rate of oil theft in the country. Oil theft deserves capital punishment".
It is difficult to fault the Senate President on the gravity of a situation in which almost a quarter of Nigeria's oil revenues are being appropriated daily by some criminal gangs. Yet as we have consistently argued on this page, while oil theft poses great danger to our economy and our security, it is also evident that the problem persists because there is some form of official complicity in what has become an organised crime. It is therefore time that the authorities took serious measures against these criminals.

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