NNPC GMD laments daily loss of 700,000 barrels of crude oil to militancy

Photo: NNPC GMD, Mr. Maikanti Baru

The Nigerian National Petroleum Corporation (NNPC), on Thursday, lamented that the rising cases of militancy, pipeline vandalism, theft and sabotage of oil and gas assets has led to the curtailment of about 700,000 barrels per day (BPD) of crude oil.

In his presentation during a visit to the Chief of Defence Staff in Abuja, Group Managing Director of the NNPC, Mr. Maikanti Baru, also warned of dire financial consequences for the country as a result of the low crude oil output, while he stated that the country lost N51.28 billion to pipeline vandalism and product theft in 2015.

According to him, the 2016 National Budget plan was based on 2.2 million BPD of crude oil production, noting that the budget plan is now grossly impacted due to renewed militancy.

He also stated that domestic natural gas supply to power is equally impacted by the militancy, with an estimated drop of about 50 per cent, from 1.4 billion standard cubic feet per day (SCFD) to barely below 700 million SCFD, resulting to significant power outage exposure of between 2,500 megawatts (MW) to 3,000 MW as a result of direct and indirect impact.

He said, “Petroleum products supply and distribution pipelines have also suffered huge products losses with attendant cost of repairs and loss of revenue.

“For example, over 3,000 vandalism incidents were recorded every year from 2010 – 2015. In 2015 alone, pipeline losses of PMS volume of over 643 million liters valued at over N51.28 billion was incurred.

“From January to May this year, about 1,447 incidents have been recorded resulting to a loss of about 109 million litres of petroleum products and about 560,000 barrels of crude oil to refineries. Along with this menace is the incessant case of kidnapping of personnel and piracy in areas of operations.

“Other impacts of these despicable acts include loss of lives, high cost of operations, refinery shutdown, fuel crisis and large scale environmental degradation and attendant cost of oil spill clean-ups.”

He, however, stated that the NNPC is committed to collaborating with the Chief of Defence Staff (CDS) and other security agencies to bring lasting solution to eliminate the hemorrhage of losses, revenue deferments and energy security threats.

He promised to strengthen the collaboration between the NNPC, the CDS and other security agencies in securing and safeguarding oil & gas assets.

To ensure the safety of oil and gas asset across the country, Baru called on the CDS to facilitate and sustaining personnel deployment at the oil and gas industry’s critical operational facilities when required and also provide support to Corporate and Strategic Business Units of the NNPC requiring security presence to operate.

In addition, he urged the CDS to provide support to enable re-entry into the Chad basin and Benue trough for resumption of exploration and drilling activities.

In addition, he said, “As part of current NNPC Management Agenda, an internal Security Advisory Council (SAC) is proposed to be established to principally renew our strategies and security architecture and to regularly provide crucial inputs to the National Security Team.”

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