Crude Oil Sabotage In Nigeria Leads To 362.28 Million Barrels Loss, According To NEITI

Crude Oil Sabotage In Nigeria Leads To 362.28 Million Barrels Loss, According To NEITI....KINDLY READ THE FULL STORY HERE▶

A new report from the Nigeria Extractive Industries Transparency Initiative (NEITI) reveals that Nigeria lost 362.28 million barrels of crude oil due to measurement errors, sabotage, and production adjustments between 2014 and 2023. This equates to a daily loss of approximately 992,547 barrels over the ten-year period……CONTINUE READING 

The findings are detailed in the report titled “Oil & Gas Industry Audit 2023: An Independent Report Assessing and Reconciling Physical, Process, and Financial Flows within Nigeria’s Oil & Gas Industry.” NEITI noted that total crude oil production deferment during this period reached 110.66 million barrels.

The report was compiled using various sources, including submissions from the Nigerian Upstream Petroleum Regulatory Commission and reports from companies like the Nigerian National Petroleum Company Limited. NEITI defines deferment as a halt in production due to scheduled or unscheduled repairs and maintenance, pipeline leaks, or poor equipment performance.

Despite being an oil-producing nation, Nigeria continues to struggle with effectively utilizing its oil and gas potential, grappling with persistent management issues. The situation is exacerbated by outdated and corroded pipelines used for transporting crude oil.

A breakdown of the data shows a steady increase in crude losses, with the highest loss recorded at 101.05 million barrels in 2016. In 2014, the loss was just one million barrels, but this surged by 2,612 percent to 27.12 million barrels in 2015. The peak loss in 2016 amounted to 101.6 million barrels, translating to a daily loss of 278,356 barrels and a potential revenue loss of $4.6 billion, given that the average crude price was $46.07 that year.

In 2017, losses totaled 36.46 million barrels, averaging 99,890 barrels per day, leading to a revenue loss of approximately $1.9 billion, with crude averaging $54.32 per barrel. In 2018, losses rose to 53.28 million barrels, representing an average daily loss of 145,972 barrels and a revenue loss of $3.8 billion at an average crude price of $72.58.

The following years saw a decline in losses, with 2019 recording 42.25 million barrels, 39.08 million in 2020, 17.57 million in 2021, and 36.69 million in 2022. For 2023, losses decreased significantly to 7.68 million barrels, averaging 21,041 barrels per day, marking a 79 percent drop from the previous year.

The report highlighted that the 2023 losses amounted to 3.33 percent of the total metered production for affected companies. These losses were attributed to 2.91 million barrels from measurement errors, 5.25 million barrels from theft and sabotage, and 486,746 barrels from production adjustments.

To mitigate these losses, NEITI recommended that the government pursue public-private partnerships to implement advanced digital solutions for monetizing savings from crude losses. It also called for the establishment of a special fund and a dedicated committee to coordinate responses and interventions related to crude loss prevention and security of oil and gas assets. Additionally, the agency emphasized the need for a comprehensive database to track instances of resource losses that could affect product availability.

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