The Speaker of the House of Representatives, Hon Tajudeen Abbas says Nigeria lost a whopping $46 billion (N16.25 trillion) to crude oil theft between 2009 and 2020.
He disclosed at the Public Hearing by the Ad-hoc Committee on the Need To Investigate Crude Oil Theft And Loss of Revenue Accrued From Oil and Gas Sector In Nigeria.
He said the menace of crude oil theft has affected the growth of the country’s oil production, with Nigeria losing between 5 to 30% of daily crude oil production.
He said that it was disheartening that heads of government agencies fail to appear at hearings of the House of Representatives.
The Speaker who observed that committees of the House are mini Houses with full authority, said that they deserve all the cooperation and respect from heads of agencies both government and private.
He said 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 two decades.
Abbas who was represented by the k Hon Alhassan Doguwa noted that Nigeria today faces a major fiscal crisis arising from oil theft that requires collaboration of all stakeholders to eliminate.
“However, we must agree Crude oil theft has drastically hampered the growth of Nigeria’s oil production. It is reported that Nigeria loses between 5% – 30% of its crude oil production daily. Data available through the yearly reports of the Nigeria Extractive Industries Transparency Initiative (NEITT) show that Nigeria’s oil production declined from 2.51 million barrels per day in 2005 to 1.77 million barrels per day in 2020. NEITI reports also show that 619 million barrels of crude valued at $46 billion were stolen in the period 2009-2020. Nigeria has continually failed to meet its daily production quota as set by the Organisation of the Petroleum Exporting Countries (OPEC). 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 manifest in the economic crisis that the country is facing. The House of Representatives is concerned that if decisive actions are not taken urgently the country may be thrown into a deeper fiscal crisis due to dwindling revenues from the oil and gas sector engendered by crude oil theft. The House is aware of several efforts by past administrations to address the menace of crude oil theft,” Abbas said.
He also said that the House was aware that several task forces, special committees, and investigative panels were set up in the past, each with a wide range of findings and recommendations.
“The House set up the Ad Hoc Committee on the Need to Investigate Crude Oil Theft and Loss of Revenue Accrued from the Oil and Gas Sector on the 27 of July 2023. The Committee was set up in line with the National Assembly’s determination to continue to reform the oil and gas sector and ensure the optimization of the sector’s potential for the benefit of Nigerians. The Ad Hoc Committee is expected to investigate crude oil theft and other related channels of revenue loss to identify measures that can be taken to curb the huge revenue and economic losses to the country. It is also expected that the Committee will identify the players, at all levels, who are responsible for this criminal enterprise and ensure that they are brought to book,“ he said.
He appealed to all the invited government ministries, departments, and agencies: security forces, industry players, and civil society organisations to please accord the committee maximum cooperation that will facilitate their work.
” The Committee has a very short time to complete its work and will certainly rely on the cooperation of all the relevant key players 49 achieve its objectives. The House will require all hands to be on deck as we engage this challenge that faces us as a nation. We expect that beyond the public hearing, the committee will continue to engage with you when and where necessary as they work towards improving domestic resource mobilisation from the oil and gas sector. It is our expectation that the committee’s findings and recommendations will form part of wider deliberations by the House as we seek urgent solutions to the challenges in the oil and gas sector,“ he said.
The Speaker also cited data from the Nigeria Extractive Industries Transparency Initiative (NEITI) and said the country’s oil production declined from 2.51 million barrels per day in 2005 to 1.77 million barrels per day in 2020.
“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).
“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 manifest in the economic crisis that the country is facing.”
According to him, global recovery from the COVID-19 pandemic and the ongoing war between Russia and Ukraine have cast a cloud of uncertainty on the oil and gas sector.
The Chairman of the Ad-hoc Committee on the Need To Investigate Crude Oil Theft And Loss of Revenue Accrued From Oil and Gas Sector In Nigeria, Hon Alhassan Rumrum, said that the volume of losses occasioned by oil theft and its associated impact on the economy was completely unacceptable and cannot be tolerated by any government who sincerely loves its citizens.
“I am therefore appealing to all the invited stakeholders to please work together with this committee for us to put an end to this embarrassment.
“And to members of the armed forces/security agencies, all Nigerians in the various states, host communities and even in the diaspora who are involved in this practice, I challenge you all to have a rethink. We have no other country to call our own, let us therefore not push this madness to a point of no return where we may find nowhere to run to.
“These efforts will be in vain unless we make a resolute statement and send a powerful message through both words and actions, declaring that oil theft and all forms of hydrocarbon unaccountability will not be tolerated under this administration.
“Only then can our people confidently and joyfully embrace a renewed sense of hope and purpose.“
Piqued by the absence of the Minister of State for Petroleum, Heineken Lokpobiri; Minister of Environment, Mohammed Hassan Abdullahi; Minister of Finance, Wale Edun; Managing Director of Nigeria National Petroleum Company Limited, Mele Kyari; the Economic and Financial Crimes Commission (EFCC) among other, the committee issued a 24-hour ultimatum for them to appear.
Another agency summoned is the Nigerian Maritime Administration and Safety Agency (NIMASA)
There were submissions from the office of the National Security Adviser, the Commandant of the Civil Defense Corps, the Nigerian Army, Airforce, Navy, the Nigerian Police, and the Department of State Security amongst others.
Recall that the House on Wednesday, 12th July 2023 deliberated on a Motion by Philip Agbese and resolved to constitute an Ad-hoc Committee to investigate crude oil theft in Nigeria to curb economic loss and ensure that everyone complicit in the theft is brought to book.
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