Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Dr Emmanuel Kachikwu has disclosed that oil theft would be eradicated in the next eight months as the corporation has put in place measures to check the menace and bring perpetrators to book.
Speaking at a one-day seminar on Security in the Gulf of Guinea, organised by the Gusau Institute in Abuja, Dr Kachikwu said the fight to stop oil theft was not only for the NNPC but also all Nigerians, as the effect of crude oil theft was on all Nigerians.
According to the NNPC boss, some of these measures include the introduction of drones to monitor the pipelines as well as patrol the country’s coastal waters; equipping and increasing the capabilities of the security services to carry out their responsibilities and the engagement of communities to police pipelines in their areas.
While promising to introduce transparency in running the NNPC, Dr Kachikwu revealed that the PPMC would be broken up into several companies with one solely in charge of pipelines while another would be in charge of products at the depots
He said: “The job of keeping our country afloat and making sure that the revenues from oil are transparently received and spent is the main purpose of my work. When I was first asked by the President to come and take over this job, my first reaction was trepidation and fear, largely because over the last two decades, we have gone topsy-turvy with our oil industry. We, as a country, have lost so much both in terms of revenue and international perception. I carry a responsibility that is not just making sure that the oil industry generates so much revenue, but also a responsibility of bringing back high level of transparency in terms of perception. What is happening is that a few people do bad things but it rubs off on Nigeria. Many Nigerians are doing the right thing.
“Nigeria is the eighth largest producer of oil in the world but you probably would not see that as you traverse our country because a large volume of oil produced lands in the pockets of very few people and many of us remain extremely poor. That is because over the years, we have been unable to transparently deal with our oil.
“Oil theft is a major issue for us. We lose on average of about 50,000 barrels of oil. We lose about $3-$4 billion of revenue and that is just in terms of crude oil itself. When you get to pipelines, most of our pipelines are ruptured and attacked fairly frequently. Last year alone, between June 2014 and June 2015, we recorded between 3,400 to 4,000 attacks on the various pipelines in the country. The effect is a shut-in of about 250,000 barrels a day and when you calculate that, you have a net loss of over $7 billion.
8 months deadline
“A lot is happening. More challenges are going to be there but we are going to be able to solve the problems. We have given ourselves eight months within which we will hopefully completely eradicate the issue of oil theft in Nigeria. It is a focus that is very firm, very determined and in the process, you are going to find individuals who constitute some of the highest level of personnel in this economy. Oil theft is not just about the poor in the society. It is about the very rich and it takes a rich man to be able to get the market for the crude and enter into the carriage contract. It is the rich in the country that are actually the problem of NNPC and not the poor. We will address that very solidly, and we will achieve result for Nigeria. If we don’t do that we would have lost the essence of our appointment into this position. Working with security agencies, and using lots of technology we will ensure that this business stops. It is critical that the Nigerian face is not seen as a face of theft but a face of decency.”
He noted that because of the constant vandalism of the country’s pipelines, the refineries may not be able to function effectively except the issue of pipeline vandalism was resolved, adding that in order to check the menace, the security architecture around the pipelines was being re-engineered.
“The pipelines that traverse our country which are supposed to carry crude into our refineries are perpetually harassed and the net effect is that we resorted to using marines to carry cargoes into our refineries. What it meant is that no matter what you do with our refineries today, unless that is solved, we cannot operate the refineries. Every month, I sit and try to decide whether I should move crude to the refineries or sell the crude and be able to fund the other accounts. The marine services are too expensive for me.
“In the last one year, we have lost about 350 lives — NNPC staff, policemen, community members — as a result of attempts to breach these pipelines.
“Let me get to the export aspect of it. You get calls from all parts of the world — China, America, alleging that cargoes of Nigerian crude are lying in those countries’ territories, most of them sold. We are dealing with a case currently of over 14 cargoes in China, where all the documentation appears to be from the NNPC. It might as well be that by the time we finish with the documentation of these cargoes, we will get to find out that they are cargoes probably out of Iran or Iraq who may be trying to sell their goods as a result of the embargo. But for whatever it is worth, Nigeria has become known, unfortunately as the country with the highest level of crude theft and sophisticated movement of funds.
Use of drones
“It is a major concern for the President and a major concern for all of us in the industry and we are focused on trying to find solutions. We have marshaled out an armada of approaches to this which include incorporating drones to check movement within our territorial waters towards the ship; we are looking at logistical ways of changing something at our crude oil loading bays; we are trying to equip the Navy sufficiently, in terms of skills and not in terms of arsenal. We are trying to take the bull by the horns to ensure that they patrol within the maritime zone.
“But more fundamentally, the pipelines that carry oil and crude will have to be policed. The present attempt at policing them has not worked, so we are thinking of changing the personnel, using more of the military but also getting into dealing with the community which ultimately is the best security in dealing with these pipelines, as we try to create more incentives for them to own the pipelines,” he said.
Speaking on the new measures being introduced, the NNPC boss said: “It is one of many efforts that we have put in place. But most importantly, we are trying to improve on the psyche of the people who work in the NNPC. We are trying to make them understand that there is a difference between a corporation and a civil service because ultimately we begin to realize that we are here to run a business for Nigeria, we have no need being there,” he said.
Earlier in his keynote address, the Prime Minister of Sao Tome and Principe, Mr Patrice Emery Trovoada said Nigeria should place less emphasis on oil production and should instead consider the option of exploring other resources like fish in the Gulf of Guinea in order to diversify its revenue base.
He called for greater cooperation amongst countries of the Gulf of Guinea to check the incidence of piracy and oil theft, adding that his country would continue to cooperate with Nigeria to check the menace.
Navy to complement drones
Meanwhile, the Chief of Naval Staff, Vice Admiral Ibok Ibas said, yesterday, that the Nigerian Navy will collaborate with other security agencies to ensure that any measure that will result to checkmating illegal oil bunkering and pipeline vandalization is nipped in the bud.
Speaking against the background of disclosure by Dr. Kachikwu that drones will be deployed to ensure that oil theft is checkmated in the country, Vice Admiral Ibas said: “First, we are deploying electronic surveillance equipment to ensure that this menace is brought to an end.
“Secondly, the Navy has standby response teams ready to move at the quickest deployment because even if the drones are deployed as disclosed by the NNPC GMD, it is the Navy that will be required to implement the response aspect”.
The CNS who spoke to Vanguard last night further insisted “we are all working in collaboration with NNPC and other security agencies to end this menace which has impacted negatively on our nations’ economy and revenue base. I am assuring you that we will give all the support necessary to achieve the goal as enunciated by the NNPC GMD.”
What drones do
Drones are automated (pilotless) micro aircraft used for security monitoring and surveillance purposes, often described as “eyes in the sky.”
According to the Social Science Research Network, SSRN, drones are “less expensive and more efficient than conventional aircraft at tracking the movements of large numbers of people without their knowledge. The capabilities of onboard instruments like high-resolution cameras, infrared devices, facial recognition systems, and other sensory enhancing technologies will make it virtually impossible to shield oneself from government watch.”
According to the NNPC boss, some of these measures include the introduction of drones to monitor the pipelines as well as patrol the country’s coastal waters; equipping and increasing the capabilities of the security services to carry out their responsibilities and the engagement of communities to police pipelines in their areas.
While promising to introduce transparency in running the NNPC, Dr Kachikwu revealed that the PPMC would be broken up into several companies with one solely in charge of pipelines while another would be in charge of products at the depots
He said: “The job of keeping our country afloat and making sure that the revenues from oil are transparently received and spent is the main purpose of my work. When I was first asked by the President to come and take over this job, my first reaction was trepidation and fear, largely because over the last two decades, we have gone topsy-turvy with our oil industry. We, as a country, have lost so much both in terms of revenue and international perception. I carry a responsibility that is not just making sure that the oil industry generates so much revenue, but also a responsibility of bringing back high level of transparency in terms of perception. What is happening is that a few people do bad things but it rubs off on Nigeria. Many Nigerians are doing the right thing.
“Nigeria is the eighth largest producer of oil in the world but you probably would not see that as you traverse our country because a large volume of oil produced lands in the pockets of very few people and many of us remain extremely poor. That is because over the years, we have been unable to transparently deal with our oil.
“Oil theft is a major issue for us. We lose on average of about 50,000 barrels of oil. We lose about $3-$4 billion of revenue and that is just in terms of crude oil itself. When you get to pipelines, most of our pipelines are ruptured and attacked fairly frequently. Last year alone, between June 2014 and June 2015, we recorded between 3,400 to 4,000 attacks on the various pipelines in the country. The effect is a shut-in of about 250,000 barrels a day and when you calculate that, you have a net loss of over $7 billion.
8 months deadline
“A lot is happening. More challenges are going to be there but we are going to be able to solve the problems. We have given ourselves eight months within which we will hopefully completely eradicate the issue of oil theft in Nigeria. It is a focus that is very firm, very determined and in the process, you are going to find individuals who constitute some of the highest level of personnel in this economy. Oil theft is not just about the poor in the society. It is about the very rich and it takes a rich man to be able to get the market for the crude and enter into the carriage contract. It is the rich in the country that are actually the problem of NNPC and not the poor. We will address that very solidly, and we will achieve result for Nigeria. If we don’t do that we would have lost the essence of our appointment into this position. Working with security agencies, and using lots of technology we will ensure that this business stops. It is critical that the Nigerian face is not seen as a face of theft but a face of decency.”
He noted that because of the constant vandalism of the country’s pipelines, the refineries may not be able to function effectively except the issue of pipeline vandalism was resolved, adding that in order to check the menace, the security architecture around the pipelines was being re-engineered.
“The pipelines that traverse our country which are supposed to carry crude into our refineries are perpetually harassed and the net effect is that we resorted to using marines to carry cargoes into our refineries. What it meant is that no matter what you do with our refineries today, unless that is solved, we cannot operate the refineries. Every month, I sit and try to decide whether I should move crude to the refineries or sell the crude and be able to fund the other accounts. The marine services are too expensive for me.
“In the last one year, we have lost about 350 lives — NNPC staff, policemen, community members — as a result of attempts to breach these pipelines.
“Let me get to the export aspect of it. You get calls from all parts of the world — China, America, alleging that cargoes of Nigerian crude are lying in those countries’ territories, most of them sold. We are dealing with a case currently of over 14 cargoes in China, where all the documentation appears to be from the NNPC. It might as well be that by the time we finish with the documentation of these cargoes, we will get to find out that they are cargoes probably out of Iran or Iraq who may be trying to sell their goods as a result of the embargo. But for whatever it is worth, Nigeria has become known, unfortunately as the country with the highest level of crude theft and sophisticated movement of funds.
Use of drones
“It is a major concern for the President and a major concern for all of us in the industry and we are focused on trying to find solutions. We have marshaled out an armada of approaches to this which include incorporating drones to check movement within our territorial waters towards the ship; we are looking at logistical ways of changing something at our crude oil loading bays; we are trying to equip the Navy sufficiently, in terms of skills and not in terms of arsenal. We are trying to take the bull by the horns to ensure that they patrol within the maritime zone.
“But more fundamentally, the pipelines that carry oil and crude will have to be policed. The present attempt at policing them has not worked, so we are thinking of changing the personnel, using more of the military but also getting into dealing with the community which ultimately is the best security in dealing with these pipelines, as we try to create more incentives for them to own the pipelines,” he said.
Speaking on the new measures being introduced, the NNPC boss said: “It is one of many efforts that we have put in place. But most importantly, we are trying to improve on the psyche of the people who work in the NNPC. We are trying to make them understand that there is a difference between a corporation and a civil service because ultimately we begin to realize that we are here to run a business for Nigeria, we have no need being there,” he said.
Earlier in his keynote address, the Prime Minister of Sao Tome and Principe, Mr Patrice Emery Trovoada said Nigeria should place less emphasis on oil production and should instead consider the option of exploring other resources like fish in the Gulf of Guinea in order to diversify its revenue base.
He called for greater cooperation amongst countries of the Gulf of Guinea to check the incidence of piracy and oil theft, adding that his country would continue to cooperate with Nigeria to check the menace.
Navy to complement drones
Meanwhile, the Chief of Naval Staff, Vice Admiral Ibok Ibas said, yesterday, that the Nigerian Navy will collaborate with other security agencies to ensure that any measure that will result to checkmating illegal oil bunkering and pipeline vandalization is nipped in the bud.
Speaking against the background of disclosure by Dr. Kachikwu that drones will be deployed to ensure that oil theft is checkmated in the country, Vice Admiral Ibas said: “First, we are deploying electronic surveillance equipment to ensure that this menace is brought to an end.
“Secondly, the Navy has standby response teams ready to move at the quickest deployment because even if the drones are deployed as disclosed by the NNPC GMD, it is the Navy that will be required to implement the response aspect”.
The CNS who spoke to Vanguard last night further insisted “we are all working in collaboration with NNPC and other security agencies to end this menace which has impacted negatively on our nations’ economy and revenue base. I am assuring you that we will give all the support necessary to achieve the goal as enunciated by the NNPC GMD.”
What drones do
Drones are automated (pilotless) micro aircraft used for security monitoring and surveillance purposes, often described as “eyes in the sky.”
According to the Social Science Research Network, SSRN, drones are “less expensive and more efficient than conventional aircraft at tracking the movements of large numbers of people without their knowledge. The capabilities of onboard instruments like high-resolution cameras, infrared devices, facial recognition systems, and other sensory enhancing technologies will make it virtually impossible to shield oneself from government watch.”
