NNPC calls for tougher penal deterrents to oil theft
Sopuruchi Onwuka
Nigerian National Petroleum Company (NNPC) Limited has called on the government to deploy stronger penal measures against crude oil theft in the country.
Group Managing Director, Mallam Mele Kyari, declared that the country has lost over $5 billion to oil thieves in the past 15 months. He said that huge losses to upstream operations in the country have deterred new investments in the industry.
Mallam Kyari who was at the National Assembly to explain leakages in oil income stated that the industry suffered loss of princely $4,0 billion in 2021 alone in terms of missed value, adding that losses in the first quarter of the year has already reached $1.5 billion.
The Oracle Today reports that the management of NNPC traditionally faces accountability issues during political campaign periods which come every four years. The company traditionally grapples with accounting disputes with the National Assemble arising from revenue shortfalls in the upstream sector of the industry, and also excessive spending to supply local petrol market.
In the present circumstance, the company which manages government’s financial interests in the operations of commercial investors in the industry is facing multiple questions relating to petrol shortage, revenue shortage, high import bills and rising spends.
The situation comes as government continues borrowing to finance closure of revenue gaps in the budget despite jumps in oil and gas prices in the export market.
Mallam Kyari stated at the National Assembly that oil thieves and cross-border smugglers drain government’s funds from the industry from multiple points, adding that production losses in the upstream sector of the industry have become disincentive for sustained operations.
In pointing at the production conduits to the Bonny Terminal, he lamented that the pipeline which normally pumps some 239,000 barrels of crude oil now delivers paltry 3000 barrels a day at the destination.
The situation, according to him, has eroded the incentive for operators to continue production.
He made it clear that the country should create a definitive legal process for prosecuting crude oil thieves.
