By Gideon Osaka
The rising spate of crude oil theft and pipeline vandalism has ignited concerns over the effectiveness of the measures deployed by the Federal Government to stem the hydra-headed existential economic challenge facing the country. Amid multi-billion naira pipeline surveillance contracts awarded to local security outfits, the Nigerian National Petroleum Company (NNPC) Ltd. has continued to decry its inability to deal with the scale of oil theft and vandalism in the country as more efforts yield less of the desired outcomes.
Valuechain reports that from all indications, the priority of the government is to crack down on organized gangs and thieves sabotaging critical oil assets in the Niger Delta, rather than dealing with the root cause of the problem. This is evident in the scale of incidents and discoveries reported regularly by the NNPC and other NNPC-funded local and national security outfits.
For instance, early this year, the NNPC Limited announced that it recorded 112 incidences of crude oil theft between December 23 and 29, 2023 in the Niger delta. In a documentary posted on its X handle, the company revealed that 42 illegal refineries were discovered in Konsho and Tebidaba in Bayelsa state; Obokofia in Imo state; Ogidigben, Mereje and Obodo Omadina, in Delta state. Illegal refineries in Umuire, Abia state, and Upata in Rivers state, were also discovered and destroyed. Within one week (December 30, 2023 and January 5, 2024), the company announced it recorded 157 incidents. According to a report made available to the public at the time, 52 illegal refineries were discovered in Obuzo and Owaza in Abia, Ohaji/Egbema in Imo, Rumuekpe in Rivers and Otuesegha in Bayelsa. Illegal storage sites were also uncovered in parts of Akwa Ibom State.
The spate of oil theft and vandalism continued unabated, as between January 6 and 12, a total of 211 incidents were reported, with no fewer than 83 illegal refineries discovered. Between January 13 and 19, the company announced that 214 incidents of oil theft were recorded in the region. According to the oil company, “72 illegal refineries were discovered across several locations” in Rivers, Bayelsa and Abia states especially in Ogubolo, Rivers, “where an illegal refinery is being destroyed”. 42 illegal oil connections were uncovered in Rivers, Delta and Bayelsa states. Also, 26 cases of vandalism were reported in Rivers and Imo. Two cases of oil spill caused by vandals and eight illegal storage sites were discovered across several locations.
Between 10th and 16th of February, 2024, the NNPC Limited announced it discovered 223 fresh illegal connections and illegal refineries. As seen in a two-minute video it posted on its X handle, sacks of crude oil were discovered in Warri, while cans of crude oil were seized in Edo State. More oil sacks were also seized in Oloibiri, Bayelsa State. Vandalised wellheads and pipelines were spotted in Bayelsa, and vehicles used for operations by the oil thieves were seized in Ole, Ugheli, and Warri in Delta State.
Providing insight as to the scale of crude oil theft since 2022, Group CEO, NNPC, Mele Kyari told the House of Representatives Special Committee on Oil Theft who were on an oversight tour at the NNPCL Towers on Wednesday March 13, that, at least 6,465 illegal refineries have been discovered and destroyed while 4,876 illegal connections to pipelines have been discovered and removed.
We need help
Apparently overwhelmed by the growing threat the continued theft of oil has on the country’s economy, the NNPC Ltd had on Monday, March 11, reached out to the Economic and Financial Crimes Commission (EFCC) for help to tackle the menace of crude oil theft. Making the appeal at an interactive session with the EFCC’s helmsman Ola Olukoyede at the NNPC Towers in Abuja, the Group CEO of the company, Mele Kyari, spoke passionately about the efforts by NNPC Ltd. to eradicate and stem crude oil theft and pipeline vandalism, contending that going by the volume of oil stolen daily and the brazenness with which the perpetrators operate, crude oil theft was the most humongous and virulent economic crime that must attract the attention of the EFCC.
“There is one big challenge that you will need to help us with, Mr. Chairman. That challenge is crude theft. Today, we have disconnected up to 4,846 illegal pipes connected to our pipelines; that is out of 5,543 such illegal connection points. That means there are a vast number of such connections that we have not removed.”
“These things don’t just happen from the blues. They happen in communities and locations we all know. As we remove one illegal connection, another one comes up. It is sad”.
Decrying the state oil firm’s inability to continue to deal with the scale of oil theft, Kyari two days earlier during an oversight visit by the House of Representatives Special Committee on Oil Theft/Losses, revealed that the scale of the infraction was unbelievable and the company would not be able to deal with it.
Valuechain reports that crude oil theft has been on the increase in the Niger Delta despite efforts to stem the tide. The situation continues to threaten the 28.77 trillion naira 2024 budget which is based on crude oil production of 1.78 million barrels per day. Though there seems to be a gradual improvement in oil production, the country is still below the OPEC quota of 1.58 million barrels per day in 2024. The country’s inability to meet her production targets has been largely attributed to crude oil theft.
Theft continues despite multi-billion contracts
The menace continues to ravage the industry despite acclaimed industry-wide security collaboration and a number of successes, especially joint operations with the Nigerian military, which has resulted in the destruction of several illegal refineries.
The admittance of its inability to deal with theft and vandalism calls for the review of multibillion naira pipeline surveillance contracts to the local security firms engaged and national security forces. Amid public outcry, local security outfits like Pipeline Infrastructure Nigeria Limited (PINL), Maton Engineering Ltd and Tantita Security Services Ltd. have continued to clinch lucrative pipeline surveillance contracts from the state oil company. This is outside the support funding the company offers to government security agencies.
Of particular public interest is NNPC’s reported renewal of the pipeline surveillance contract to Tantita Security Company led by former militant leader Government Ekpemepulo aka Tompolo for three years, in a move acknowledging the efforts of Tantita in combating oil theft. The contract was first awarded in August 2022 to protect critical oil and gas infrastructure and secure permanent peace in the oil rich Niger Delta region. Based on the contract reportedly worth N48bn per year (N4bn per month), Tantita Security Services Limited, was expected to protect all oil pipelines crisscrossing nearly all the states in the Niger Delta: Delta, Ondo, Imo, Rivers and some parts of Bayelsa State, in collaboration with other major stakeholders in the oil-bearing communities in the region.
The Group CEO of the NNPC Limited, Mele Kyari, had in August 2022, justified the government’s decision to award the pipelines surveillance contract to Tantita, explaining that the decision was necessitated by the need to hire private contractors to man its oil pipeline network nationwide due to massive oil theft.
He said, “the security agencies are doing their part, end-to-end pipeline surveillance would require the involvement of private entities and community stakeholders. We need private contractors to man the right of way to these pipelines. So we put up a framework for contractors to come and bid and they were selected through a tender process. And we believe we made the right decision,” the NNPC boss stated then.
Although some stakeholders in the Niger Delta have openly criticized the decision to award such surveillance contract to “one man”, chief among them are Rivers State Governor, Siminalayi Fubara, and Mujahid Asari-Dokubo, ex-militant leader and founder of the Niger-Delta People Volunteer Force (NDPVF), the local security outfit continues to garner support from critical stakeholders in the government.
While the Senate, through its Committee on Petroleum (Upstream) has backed the decision last November to award the contract to Tantita, the Minister of State for Petroleum (Oil), Senator Heineken Lokpobiri, also supported the idea, expressing “gratitude to Tantita that has been commissioned by the NNPC to be able to do some work” on the problem of pipeline vandalisation and illegal bunkering, which he said has become an existential problem. On his part, the National Security Adviser (NSA), Nuhu Ribadu after inspecting illegal facilities in Delta State with Lokpobiri on Saturday, August 26, 2023, said the Federal Government would sustain its partnership with Tantita Security Services Limited, to curb the crime of pipeline vandalism and oil theft in the Niger Delta.
Experts have cautioned that, leaving the security of pipelines in the hands of militants rather than government establishments is not sustainable as this would only encourage other militants to increase their capacity to disrupt government installations to gain attention.
Others wondered why the government would fund locals to protect assets whereas the Petroleum Industry Act 2021 made host communities responsible for the security of oil installations. There is a provision that 3% of the budget of oil companies be paid to Host Community Trust for the development of their communities. The law envisages that, if members of host communities destroyed oil installations, the cost of repairs shall be deducted from the 3%.