Says PIB Will Change Oil Industry in Nigeria
There are indications that the Federal Government has finally had enough with the massive oil theft going on in the Niger/Delta and is ready to tackle the problem more forcefully.
This hint dropped by the Petroleum Minister Alison-Madueke while speaking on a CNN programme on Friday morning, in which the Nigerian oil and gas industry was the focus of global attention.
Speaking on the CNN‚Äôs World Business Today, Mrs. Alison-Madueke, who is as well featuring on the broadcast network‚Äôs popular Leading Women Series, also stressed that the passage of the all important oil industry reform bill will change the face of the petroleum industry in the country.
Answering a question on the objective of the Petroleum Industry Bill (PIB), the Minister said that the law is designed to capture and address potential environmental and operational hazards associated with the oil and gas industry.
“I am ensuring that within the next 4-5 weeks, with the major assistance of the National Assembly of Nigeria, we shall in fact be promulgating it into law‚Äù, adding that the PIB is an amalgamation of 16 different laws with very stringent guidelines for environmental remediation.
The Minister stated that Nigeria is determined to learn from the recent disaster in the Gulf of Mexico so as to prevent recurrence of such disaster in the country.
Deepwater Horizon oil spill from a field operated by BP in April 2010, is considered to be the world‚Äôs largest ever oil spill and led to the British/Dutch oil giant being fined a record-setting $4.525 billion.
She also informed that the PIB will usher in a new vista in the oil industry in the country which will witness increased participation of local communities in the process.
The Minister added that government was working hard to increase local refining capacity by opening up the space for new investors in the downstream sector.
Oil theft in Nigeria is now being stolen on an industrial scale, a report released two months ago by Chatham House, a UK-based policy think-tank, has shown.
In the report, Chatham House said the country lost at least 100,000 barrels of oil per day (b/d), about five per cent of Nigeria‚Äôs total output in the first quarter of 2013, to theft from its onshore and swamp operations alone.
The Chatham House report said: ‚ÄúSome of what is stolen is exported. Proceeds are laundered through world financial centres and used to buy assets in and outside Nigeria, polluting markets and financial institutions overseas, and creating reputational, political and legal hazards. It could also compromise parts of the legitimate oil business.‚Äù
It added that officials outside Nigeria were aware that the problem existed, and occasionally showed some interest at high policy levels, ‚Äúbut Nigeria’s trade and diplomatic partners have taken no real action, and no stakeholder group inside the country has a record of sustained and serious engagement with the issue.‚Äù
The resulting lack of good intelligence means international actors cannot fully assess whether Nigerian oil theft harms their interests, it stated.
‚ÄúIt is not clear how much of Nigeria‚Äôs oil is stolen and exported. The best available data suggest that an average of 100,000 b/d vanished form onshore, swamp and shallow-water areas in the first quarter of 2013.
‚ÄúThis figure does not include what may happen at export terminals. It also assumes the integrity of industry numbers. But whatever the size of the problem, stolen Nigerian oil represents a tiny fraction of global crude supply and consumption, and a diminishing share of rising light sweet crude production globally.
‚ÄúGlobal supply exceeded 86.1 million b/d in 2012, while global consumption topped 89 million b/d. Even assuming Nigeria lost 250,000 b/d to theft, this would represent less than 0.003 per cent of global supply,‚Äù Chatham House said in the report.
And the effects of this massive oil theft is already impacting on the federal government‚Äôs finances, with government being forced to withdraw from its Excess Crude oil account to make up for the shortfalls in monthly revenue allocations to the three tiers of government for October.
Following the latest withdrawal the ECA is now down to about $3.598 billion.
According to the Nigerian National Petroleum Corporation (NNPC), about $2.23 billion (N191 billion) revenue that should have accrued to the federal government from oil proceeds was lost to the activities of crude oil thieves in the first quarter (1Q) 2013, with an estimated $6 billion lost annually to the menace.
Incidentally only on Thursday, the Chief of Naval Staff, Vice Adm. Dele Ezeoba, praised government for prompt provision of logistics support to the navy to fight illegal bunkering.
He said the navy, in collaboration with other security agencies, had arrested and prosecuted many oil thieves, pipeline vandals and pirates who tried to sabotage the nation‚Äôs economy.
‚ÄúThe navy has recorded a lot of achievements in the area of operational capabilities, human resource development and welfare related support services, among others.
‚ÄúUnder my watch, we have reduced to large extent, crude oil theft and pipeline vandalism in collaboration with the Army, Air Force and the Joint Task Force contributed by the armed services.
‚ÄúWe are winning this battle and will continue with vigour and seriousness by securing our maritime environment to ensure economic growth and prosperity of the nation‚Äù, he said.