The Managing Director of the Nigerian Ports Authority (NPA), Mohammed Koko, recently revealed the new method used by operators of oil vessels to steal the nation’s crude oil. The NPA boss disclosed that the operators of the thieving vessels now turn off their Automatic Identification System (AIS) to evade detection to steal oil in the Niger Delta region. The AIS is a technology device that usually aids the tracking of such stray and dubious ships in the Nigerian waters.

Available records show that over 400,000 barrels of crude oil are reportedly stolen daily from Nigeria. According to the Ministry of Petroleum Resources, Nigeria loses about $1.9billion monthly due to the activities of oil thieves.  The revelation by the NPA MD came in response to a question at a recent media briefing organised by the Presidential Communication Team in Abuja.

He explained: “They come in legally but then, they go by the left hand side to commit illegal activities after switching off their Automatic Identification System.” Besides, it has been reported that oil theft go hand in hand with theft of buoys worth millions of dollars. This has made navigation more dangerous and has discouraged international cargo ships from using Nigeria’s eastern maritime corridor that includes Calabar, Port Harcourt, Onne and Warri ports.

It is public knowledge that oil theft is an organised crime, which has persisted because of collaboration of some security personnel and other unscrupulous elements, within and outside the country. To curb oil theft in the Niger Delta region, there is need for the collaboration of all the stakeholders, including oil companies, security agents and oil-bearing communities.

Since the oil sector is the mainstay of the economy, oil theft may cripple the economy if not properly checked.  That is why the government must wage a relentless war against oil thieves.  Obviously, the activities of oil thieves have assumed a new and dangerous dimension that threatens the economy of the country and the health of the people of the oil-producing communities.

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Due to the activities of oil thieves, Nigeria rarely meets her OPEC production quota of 1.99 million barrels per day. In 2021, Nigeria’s oil production averaged 1.6 mbpd, but was reduced to 1.2 mbpd mainly because of the activities of oil thieves. This translates to a shortage of about 500,000 barrels per day. That is why Nigeria has not been able to meet its projected revenue target in spite of the current rise in the price of crude oil in the international market. According to the Nigeria Extractive Industries Initiative (NEITI), the economy lost $3.5billion in revenue, accounting for 10 per cent of the nation’s foreign reserves. In 2019, the NNPC announced a loss of $159billion due to oil theft and pipeline vandalism.  Crude oil theft has probably become one of the most lucrative businesses in the country.  Given the increasing level of oil theft in recent times, all hands must be on deck to stop the menace. Nigerians will not benefit from the nation’s oil wealth if oil thieves are allowed to thrive.

The money lost to oil theft would have been enough to fix the education and health sectors. Apart from the colossal economic losses, the vandalisation of oil infrastructure can scare away investors.  However, government should also address the factors that are responsible for oil theft. Poor development of oil-bearing communities, rising poverty and unemployment can make some people resort to oil theft.

Let the government and other stakeholders work in concert to secure oil pipelines and installations. It has become vital to review the oil and surveillance contracts based on performance of contractors. Engaging the host communities will be more effective in securing the nation’s oil and gas assets.

This is the time to begin the use of video surveillance system to monitor oil pipelines as recently suggested by the Group CEO of Nigeria National Petroleum Company Ltd, Mele Kyari. The model has been successfully used by Saudi Arabia’s Aramco to check oil theft and it involves the use of video surveillance system in monitoring oil pipelines carrying crude oil from oil wells to flow stations.

Beyond curbing oil theft, the government should be thinking of Nigeria outside oil. That is why other sectors of the economy need to be given adequate attention. Nigeria must boost its exports through enhancing its agricultural products and manufacturing of goods. The development of non-oil exports will hasten the growth of the economy as well as the creation of more jobs.