Nigeria lost about N3.8 trillion to crude theft and other related infractions in 2016 a report by the Nigeria Natural Resource Charter (NNRC) has disclosed.
The report released Tuesday in Abuja titled ‘Oil Theft in Nigeria Report’, contain findings of the organisations latest report on crude oil theft.
It stated that in 2016, reports by both the government and oil companies indicated that a combined total of up to N3.8tn was recorded as the amount lost to crude oil theft, sabotage and pipeline vandalism.
The report noted that this was principally as a result of the force majeure declared at the Forcados terminal, combined with wider pipeline infractions and theft, adding that the government’s share of the loss was approximately 42 percent or about N1.6 trillion.
According to the report, the estimated value of the total losses suffered by Nigeria through the various methods of crude oil theft in the Niger Delta was higher than the current combined budgetary allocations to the health and education sectors as captured in the 2018 budget.
“The combined allocations for health and education amount to N189.4 billion, which translates to a mere 8.4 percent of the estimated value of losses from oil theft two years ago,” the organisation stated in the report.
The report identified poverty, unemployment, poor governance, pervasive corruption and the neglect of the Niger Delta region as major reasons for the emergence and sustenance of oil theft over the years.
The NNRC noted however, that at a time when the country has just exited recession with the economy remaining fragile and national debt on the rise, reducing oil theft should be an urgent national priority.
The Nigerian government passed a record budget of N9.12 trillion for 2018, with a revenue target of N7.2 trillion, most of which it aims to achieve from the petroleum sector necessitating the need to plug the loss.
“Over the last decade, oil theft has risen to unprecedented levels, peaking between 2011 and 2014. The inability of the government and oil companies to curb this epidemic has made Nigeria the country most plagued by oil theft in the world,” the report said.
It however, observed that although oil theft was as old as the sector in Nigeria, the level of pilfering remained insignificant up untill the 1970s. “With global oil prices rising above $100 a barrel in the early 2000s, oil theft evolved into a cottage industry, creating consequential socio-economic problems.” The reported further noted.