Shell loses N202m daily to oil thieves, vandals

Shell

 

 

Oil supermajor, Royal Dutch Shell, yesterday hinted that it loses 10,000 barrels of crude oil or about N202 million daily in revenue to theft and vandalism of its pipelines in the Niger Delta.

The company’s subsidiary in Nigeria, Shell Petroleum Development Company of Nigeria Limited (SPDC), in a statement, attributed the loss to daily attacks on its pipelines by suspected crude oil thieves and vandals.

SPDC’s General Manager, External Relations, Igo Weli, who disclosed this at a media workshop on Pipelines Right of Way, Encroachment and Vandalism in Port Harcourt, yesterday, called on government, communities and other stakeholders to stem the incessant attack on oil assets in the Niger Delta.

“SPDC JV is currently losing about 10,000 barrels per day (bpd) of oil or N202 million lost daily from its pipelines to crude oil thieves in the Niger Delta.

“This is a reduction from the loss of around 11,000 bpd in 2018 and about 9,000 bpd of oil lost daily in 2017.

“These attacks were on critical assets that produce the crude oil, which accounts for over 90 per cent of Nigeria’s foreign exchange earnings and the bulk of government revenue,” Weli said.

Hurting these assets, Weli said, means “hurting the nation’s revenue, the economy of the states, the health of the people and the environment.”

He said crude oil theft on the pipeline network resulted in a loss of around 11,000 barrels of oil a day in 2018, which is more than the approximate 9,000 bbl/d in 2017.

Weli said that since 2012, SPDC had removed over 1,160 illegal theft points on its joint venture pipelines in the Niger Delta.

In its June 2019 monthly report, the Nigerian National Petroleum Corporation (NNPC), which controls Nigeria’s 55 per cent interest in the SPDC JV said there was a 77 per cent rise in oil pipeline vandalism and that 106 pipeline breaches were recorded in June, up from 60 in May.

He said SPDC was concerned about the lives and safety of those involved in pipeline vandalism and crude theft just as the company was concerned about the environment.

“As a responsible organisation, we put safety first and have constantly made this appeal to those involved in crude theft in the Niger Delta to stop destroying their land and heritage from the spill and pollution arising from their activities,” he said.

He described crude oil theft and artisanal refining of stolen crude as criminal acts “that are not only against the law, but are also capable of mortgaging the future of the community.”

The general manager said that such illicit activities by criminals had denied the company and country the needed revenue to drive business and development.

He said that despite the attacks on its facilities, the company had spent billions to fund projects in the communities it operates.

According to him, the Niger Delta is the most blessed region in the country going by the huge revenue allocated to the region by government and companies.

“There is a community in the Niger Delta that has received over N2 billion from SPDC JV for its development, but is yet to develop.

“The region receives 13 per cent derivation, revenue from NDDC and funds from companies, but still has not developed.

“The Niger Delta has refused to develop despite the huge monies allocated to the area. So, we need to ask ourselves the critical questions to change the Niger Delta narratives,” he said.

Also speaking, SPDC’s General Manager, Safety and Environment, Chidube Nnene-Anochie, noted that illegal refining and third-party interference with pipelines were the main sources of pollution in the Niger Delta.

According to Nnene-Anochie, “in 2018 alone, third party interference caused close to 90 per cent of the number of spills of more than 100 kilogrammes from SPDC JV pipelines.”

Represented by SPDC’s Compliance Monitoring Lead, Temitope Ajibade, Nnene-Anochie said no spill was acceptable to the company.

“A key priority for Shell companies in Nigeria remains to achieve the goal of no spills from our operations. No spill is acceptable and we work hard to prevent them. However, SPDC cleans and remediates areas impacted by spills from its facilities irrespective of the cause,” Ajibade said.

She explained that SPDC had enhanced its community-based pipeline surveillance while promoting alternative livelihoods through Shell’s flagship youth entrepreneurship programme, Shell LiveWIRE.

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