Mele Kyari, group managing director of the Nigerian National Petroleum Company Ltd (NNPC), has sought the support of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) as crude oil theft denied Nigeria over $3.2bn in 14 months.
Kyari also called for the backing of the National Association of Road Transport Owners (NARTO) and other stakeholders in the oil and gas sector to tackle the issue in the Niger Delta region.
He made the appeal on Tuesday at the 5th quadrennial delegates’ conference of NUPENG, held in Asaba, Delta State.
The conference with the theme, “Just energy transition: For oil and gas workers social welfare and security,” was attended by Chris Ngige, the minister of labour and employment, who was represented by Ayuba Wabba, president of the Nigerian Labour Congress (NLC); Ifeanyi Okowa, Delta State governor, and Adokiye Tombomieye, the group executive director (Upstream), NNPC Ltd, and other senior officials.
According to the GMD, the theft of crude oil was having a negative effect on the Federal Government’s revenue; a development he said continues to deny the country the much-needed funding to boost economic development.
“Apart from revenue loss, the issue of oil theft is currently threatening not only the NNPC’s quest for energy security for the country, but it is also having a debilitating effect on Nigeria’s revenue earnings.”
A report released last month during a meeting on crude oil theft between the Nigerian Upstream Petroleum Regulatory Commission and Oil Producers Trade Section, and the Independent Petroleum Producers Group, showed that from January 2021 to February 2022, Nigeria lost $3.2bn to crude oil theft.
The amount when converted by the official N416.25 to a dollar exchange rate translates to about N1.3trn.
The report revealed that oil theft rose significantly between 2021 and 2022, with over 90 percent of total crude produced at the Bonny Terminal stolen in January 2022.
Speaking on this development, the NNPC GMD told participants at the NUPENG conference that the impact of pipeline vandalism has reduced the capacity of the country to meet its production quota.
He lamented that currently, Nigeria is producing less than 1.5 million barrels per day of crude oil.
In addition, Kyari said as major stakeholders in the oil and gas business, the time has come for NUPENG and NARTO to collaborate with the NNPC in bringing the issue of crude oil theft to an end.
“You can see the short trouble that we have and what it has caused all of us,” he said. He added that “our local industries are terribly challenged and you (stakeholders) may be aware, we have seen vandal activities around our areas of operations not just in the Niger Delta but across other corridors of product supply.”
He reiterated that the activities of oil thieves have gotten to a limit that hasn’t been seen before, almost bringing the industry to its knees today.
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“Our production total is less than 1.5 million barrels per day and this no doubt will affect the investing companies, they will not have the resources to continue to invest and therefore making more sustainable employment to become a challenge, no doubt about it.
“That is why all of us must practically come together to see how we can contend it. There is so much going on now and we are leading a process to ensure that we intervene in the security matter.”
Kyari said they want to ensure that everybody is involved so that the industry could be gotten back or otherwise, it collapses.
“You are very critical in stopping some of the situations today because when people steal products and they convert them to diesel, they will use your trucks to bring them into the country.
“And you can play a very prominent role to stop some of these transactions going on and I really implore all of us to come on the desk so that this industry can survive.
“We are partners and workers in the industry and NNPC is here to protect and preserve every institution that is helping this industry to grow and survive.”
Meanwhile, on the issue of energy transition, the GMD said that this concept does not mean that oil will disappear by 2050.
He said what the concept of energy transition means is that countries should start embracing more cleaner sources of energy that are more friendly to the environment.
Furthermore, he stated that the NNPC is also championing this initiative by shifting more attention to gas production which is a cleaner source of energy than fossil fuel.
Kyari said, “No doubt energy transition is going on and for emphasis, the meaning is that oil is not going to vanish by the year 2050 or 2060. What it means is that oil will still be relevant; there will still be 100 million barrels of oil demand by the year 2050.
“It is the use and the cleanliness utilization of it that will change and the activities that businesses do to ensure that the next event of our activities will become positive in such a way that you have a net-zero situation.
“The world has accepted gas as a transition fuel. That you do need to have more gas development so that you can gradually transit,” he said. “So, Oil and gas business is not going to vanish. It will change in form and in utility.
“In our case in Nigeria as we all know, we are energy deficient and access to clean power is still very low as we all know. Then this is the first step that we have to take to ensure that we arrive at that clean transition.”
Meanwhile, President Muhammadu Buhari had at the United Nations Climate Change Conference in Glasgow made a commitment to net zero emissions by 2060.
