Nigeria, partners lose N150bn revenue in 11 months due to vandalism

There are strong indications that Nigeria may have lost over N150billion ($500million) in revenue due to attacks and vandalism on an all-important Nembe Creek Trunk Line (NCTL) in the Niger Delta region.

The 97-kilometre pipeline belongs to Aiteo Eastern Exploration and Development Company of Nigeria Limited (AITEO) and has the capacity to transport 150,000 barrels of crude oil per day from Bonny Crude Oil Terminal to Bonny Export Terminal from 14 pumping stations.

According to the spokesman of AITEO, Mathew Ndiana, the NCTL has been shut 61 times between January and November 2019, and by implications, it was unable to transport 9,150,000 (nine million one hundred and fifty thousand) barrels of crude oil and subsequently declared force majeure during those shutdown periods.

Therefore, at an average crude oil price of $55 per barrel, the federal government and its joint venture partners have lost $503,250,000 (five hundred and three million two hundred and fifty thousand dollars) to the shutdowns. At an official Central Bank of Nigeria (CBN) rate of N306/$, the country has lost a total sum of N153,994,500,000.00 (one hundred and fifty-three billion, nine hundred and ninety-four million, five hundred thousand nairas) to breaches and vandalism on a single pipeline, NCTL, alone in 11 months.

ALSO READ: Four Immigration officers kidnapped by sea pirates rescued by Navy

It is important to note that the NCTL is one of Nigeria’s major oil transportation arteries that evacuate crude from the Niger Delta to the Atlantic coast for export.

“Despite significant investments in security, technology and civic engagements, the destructive pattern of pipeline vandalization still persists. These attacks are persistent; sophisticated; appear timed to inflict debilitating and disruptive effect, all indisputably calculated to decimate Aiteo’s production output in the short if not medium term. And, regrettably, these vicious and malicious exertions by individuals and faceless entities are having that unavoidable effect.

“It is a matter of utter dejection and frustration to note that in 2019 alone, Joint Investigative Visits (JIVs) comprising security and regulatory agencies as well as community representatives and Aiteo personnel to ascertain the cause of the breaches to the NCTL have revealed that 98% of all incidences were attributable to third-party infractions alone. The number of barrels lost to these incidents, almost compare in volume to the country’s total daily production.

By virtue of this level of sabotage, the NCTL has been shut down for 61 days this year alone, constituting 83% cause of downtime in this year only. Over the last four years, more than 200 shut down days have been recorded on the asset,” Ndiana said.

You might also like

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. AcceptRead More