Economy & Politics
Nigeria loses $41.9 billion to crude oil theft in 10 years
Nigeria lost $41.9 billion to crude oil and refined products theft between 2009 and 2019, a report obtained by Nairametrics disclosed.
Nigeria lost $41.9 billion to crude oil and refined products theft between 2009 and 2019, a report obtained by Nairametrics from Nigeria Extractive Industries Initiative disclosed.
Details
According to the policy brief of the agency, which was released on Wednesday, the nation lost $38.5 billion on crude theft alone, $1.56 billion on domestic crude and another $1.8 billion on refined petroleum products.
- In 10 years, Nigeria lost more than 505 million barrels of crude oil and 4.2 billion litres of petroleum products valued at $40.06 billion and $1.84 billion respectively.
- Cumulatively, total crude and product losses for the period amount to $41.9 billion. This is the size of Nigeria’s entire foreign reserves.
- On average, Nigeria lost $11.47 million daily, $349 million monthly, and $4.2 billion dollars every year for the past 10 years.
- Pipeline repairs, a direct consequence of vandalism, is a major index of losses in the oil industry.
- Between 2014-2016, total expenditure on pipeline repairs was N363 billion. This is excluded from the data in this paper as only losses of crude and products are considered.
Impact of menace
In the face of current dwindling revenues, paying priority attention to curb oil theft in the country’s oil and gas industry had become both necessary and urgent to expand revenue generation.
Proffered solution
NEITI urged the government to embrace oil fingerprinting technology, comprehensive metering infrastructure of all facilities and other creative strategies to combat the growing menace of theft of Nigeria’s crude oil and refined petroleum products.
It disclosed that Nigeria lost an average of $11 million daily, which translated to $349 million in a month and about $4.2 billion annually to crude and product losses arising from stealing, process lapses and pipeline vandalism.
“While figures from government put the loss at between 150,000 and 250,000 barrels per day, data from private studies estimated the figure to be between 200,000 and 400,000bpd.”
What it means
This implies that Nigeria may be losing up to a fifth of its daily crude oil production to oil thieves and pipeline vandals.
On comparative analysis of the size and implication of the losses to the country’s current dwindling revenue profile, NEITI renewed its appeal to the government to curb oil theft to reduce budget deficits and external borrowing.
The transparency agency stated that the value of crude oil and allied products so far lost was equal to the size of Nigeria’s entire foreign reserves.
It stated, “Stemming this hemorrhage and leakages should be an urgent priority for Nigeria at a time of dwindling revenues and increasing needs. What the country lost in 20 months in fiscal terms was enough to finance the proposed budget deficit for 2020.
“In terms of volume, 138.000 barrels of crude oil was lost every day for the past 10 years, representing seven per cent of average production of two million bpd. Nigeria lost more than 505 million barrels of crude oil and 4.2 billion litres of petroleum products between 2009 and 2018. What is stolen, spilled or shut-in represents lost revenue, which ultimately translates to services that government cannot provide for citizens already in dire need of critical public goods.”
Economy & Politics
Just in: Buhari suspends EFCC boss, Ibrahim Magu from office
The suspension follows the investigation of allegations of gross misconduct against him on Monday.
President Muhammadu Buhari has approved the suspension of the acting Chairman of the Economic and Financial Crimes Commission (EFCC), Ibrahim Magu, from office. The suspension follows the investigation of allegations of gross misconduct against him on Monday.
According to available information, Magu was suspended to allow for probe into allegations against him.
The EFCC boss appeared before a presidential probe panel headed by retired Justice Ayo Salami, who is investigating the allegations against him.
Details later…
Economy & Politics
Reps to investigate alleged illegal withdrawal of $1.05 billion from NLNG account
Gbajabiamila mandated the House to conduct a thorough investigation on activities of the dividends account.
The House of Representatives has concluded plans to investigate the alleged illegal withdrawal of $1.05 billion from Nigeria Liquefied Natural Gas (NLNG) account by the Nigeria National Petroleum Corporation (NNPC) without its knowledge and appropriation.
The decision by the lower chamber is on the heels of a unanimous adoption of a motion by the Minority Leader of the House, Ndudi Elumelu, during plenary session on Tuesday, July 7, 2020.
Going down memory lane, Elumelu recalled that the NLNG was incorporated as a limited liability company in 1989 with the aim of producing liquefied natural gas and natural gas liquids for export purposes which began in 1999.
He pointed out that the NLNG is jointly owned by the Federal Government, represented by the NNPC with a shareholding of 49% and Shell Gas with 25.6%, Total LNG Nigeria Ltd with 15% and ENI International with 10.4%.
READ MORE: Nigeria’s debt rises to $79.5 billion, as debt to revenue ratio worsens
The Minority leader said, “The dividends from the NLNG are supposed to be paid into the Consolidated Revenue Funds Account of the Federal Government and to be shared among the three tiers of government.’’
Going further in his motion, Elumelu said, “The NNPC who represents the government of Nigeria on the board of the NLNG had unilaterally without the required consultations with states and the mandatory appropriation from the National Assembly illegally tampered with the funds at the NLNG dividends account to the tune of 1.05 billion dollars thereby violating the nation’s appropriation law.
“There was no transparency in this extra-budgetary spending as only the Group Managing Director and the corporation’s Chief Financial Officer had the knowledge of how the 1.05 billion dollars was spent.’’
‘’There are no records showing the audit and recovery of accrued funds from the NLNG by the Office of the Auditor General of the Federation. Hence the need for a thorough investigation of the activities on the NLNG dividends account.”
In his ruling, the Speaker of the House, Femi Gbajabiamila, mandated the House Committee on Public Account to conduct a thorough investigation on activities that had taken place on the dividends account.
Gbajabiamila mandated the committee to invite the management of the NNPC as well as that of the NLNG in the process and report back to the house in four weeks.
Economy & Politics
Just In: DSS invites EFCC’s Acting Chairman, Ibrahim Magu for questioning
A 2016 report had indicted Magu of several criminal acts including diversion of recovered loot.
Ibrahim Magu, the Acting Chairman of the Economic and Financial Crimes Commission (EFCC) has been invited by operatives of the Department of State Services (DSS) for questioning.
Nairametrics gathered Magu was invited Monday afternoon by the DSS.
Tony Amokedo, a spokesman for Ibrahim Magu claims Mr. Magu wasn’t arrested as reported in a section of the media, but was invited for questioning by DSS officials. He said Magu was invited for a Panel set up by the Federal Government investigating corruption allegations against Magu.
READ ALSO: Reasons we arrested Innoson Motors’ boss, Innocent Chukwuma – EFCC
Also, following earlier reports of Magu’s alleged arrest, the DSS quickly released a statement through its Public Relations Officer, Peter Afunanya, Ph.D, denying the arrest of the chief of Nigeria’s anti-graft agency.
“The Department of State Services (DSS) wishes to inform the public that it did not arrest Ibrahim MAGU, Acting Chairman of the Economic and Financial Crimes Commission (EFCC) as has been reported by sections of the media. The Service, has since, today, 6th July, 2020, been inundated with enquiries over the alleged arrest,” DSS statement read.
Last month, the Attorney-General of the Federation, Mr. Abubakar Malami (SAN), wrote to Buhari, recommending the removal of Magu, accusing him of misconduct, insubordination and diversion of recovered loot.
READ ALSO: EFCC and other anti-graft agencies demand speedy repatriation of stolen funds
A 2016 report by the DSS revealed Ibrahim Magu lives a “high-profile lifestyle”. The report revealed Magu lives in a house rented for N40 million at N20 million a year which was paid for by one retired Air Commodore, Umar Mohammed.
Magu is also accused of using private jets belonging to Mohammed and going on trips with bank executives being investigated by the EFCC.
The report also revealed Magu was guilty of withholding EFCC files, obstruction of justice and sabotage by the Nigerian Police Commission in 2010.
Just in: Buhari suspends EFCC boss, Ibrahim Magu from office
Reps to investigate alleged illegal withdrawal of $1.05 billion from NLNG account
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