Crude Oil Theft: Nigeria’s lost billions

Crude oil theft and sabotage is one of the many challenges facing Nigeria’s oil sector. This was highlighted in the recent NEITI Audit Report (2009-2011).  According to NEITI estimates, Nigeria incurred the following losses due to these operations:

• Federation and oil companies lost a total of ₦1.737trillion ($10,992,776,474) during the three years under review.
• The  Nigerian government  lost $7,518,050,277 during the period
• ₦578.990 billion ($3,664,258,825) lost on annual basis
• ₦1.586billion ($10,039,065) lost on a daily basis 
• Cumulative pipeline loses due to pipeline vandalism and crude oil thefts were ₦134,126,921,724( $894,179,478)

The report also highlighted that the Nigeria’s National Oil Company (NNPC) spent over $600 million on security during the reporting period. Yet, insecurity remains a major challenge to oil sector operations and is on the increase.

Tackling crude oil theft and sabotage should be one of the major priorities of the Nigerian government. These operations are not only damaging to the economy, they lead to environmental damage. Oil is the main source of revenue to the Nigerian government. Nigeria needs to urgently address this menace to prevent the loss of huge revenues that could be used in improving our education and health sectors.