The option of transporting crude oil to the nation’s refineries by marine vessels has increased the operation cost of refining by an additional sum of $7.52 per barrel, Diezani Alison-Madueke, minister of petroleum resources has said.
In her state of the oil and gas industry address on Tuesday at the 38th Nigeria Annual International Conference and Exhibition (NAICE) in Lagos, the minister said the option was adopted to mitigate the menace of oil-theft related vandalism, hurting crude oil supply to the refineries.
“Due to the theft-related vandalism, crude oil supplies to our domestic refineries remain constrained thus affecting the nation’s refining uptime and volume. In order to mitigate this anomaly, the option of crude transportation by marine vessel has been deployed thereby increasing the operation cost of refining by an additional sum of $7.52 per barrel.”
Speaking on the challenge of pipeline vandalism, the minister said Nigeria need to recognise and declare the pipelines as national assets.
The next step is to organize and harmonise its institutions responsible for pipeline infrastructure protection, and invest appropriately in this light for effectiveness.
In 2013, we sustained an average crude oil and condensate production of 2.3 million barrels per day (bpd) and gas production of 7.6 bcfd despite crude oil theft and pipeline vandalism. Average crude oil theft and deferment during the same period was 215,000 barrels per day.
In our bid to increase transparency, we have concluded a pilot scheme for real time crude oil production monitoring and hydrocarbon accounting process, said the minister who was represented by Emmanuel Bekee, deputy director, Department of Petroleum Resources.
Only local refining as well as improved domestic gas utilisation can provide the strategic economic for industrial revolution and growth in Nigeria, said Alison-Madueke.
Femi Asu
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