By Derrick Bangura

As Nigeria’s economy continues to suffer as a result of crude oil theft, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) announced on Tuesday that it had formed a team of experts to conduct a thorough audit of operators in the upstream petroleum industry over the last two years.

The decision, according to the commission, was made to determine the exact volume of crude oil stolen by vandals and saboteurs, in response to recent complaints made by various industry operators about the level of crude theft on a daily basis.
The Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, had on Monday lamented the unprecedented rate of oil theft recorded in recent times and its debilitating effect on government revenue and accretion to reserves.

The governor’s comment came a day after THISDAY reported similar concerns expressed by the Co-founder and former Chief Executive Officer of Seplat Energy Plc, Mr. Austin Avuru, who called for a state of emergency in the Nigerian oil and gas sector.

He had revealed that up to 80 per cent of oil pumped in the country, particularly in the east, were stolen.

Avuru spoke a few days after a businessman and Chairman Heirs Holdings, Mr. Tony Elumelu, also bemoaned the worsening state of the industry, stressing that about 95 per cent of oil production does not get to the terminal.

Earlier, Aiteo Eastern Exploration and Production Company (AEEPCO), operators of the Nembe Creek Trunk Line (NCTL) pipeline, had threatened to exit the facility due to incessant vandalism, perennial sabotage and outright theft.

Nigeria has not been able to meet its quota allocated by the Organisation of Petroleum Exporting Countries (OPEC), losing close to 400,000 barrels of oil per day to lack of capacity.

Owing to these concerns in the past few days, a statement signed by the Chief Executive of the Commission, Mr. Gbenga Komolafe, disclosed the latest move to unravel the facts behind the theft, stating that the panel would carry out a forensic investigation to cover the technical and commercial operations of oil companies involved in drilling and selling of crude oil.

Komolafe stated that commission was not unaware of the, “tragedy of oil theft” which he noted has been a plague on the industry and had last year triggered an industry-wide initiative aimed at curbing it.

This, he said, was to help increase crude production levels; a development which he said followed an express presidential directive.

“Worried by incessant acts of sabotage by criminals and some unscrupulous persons within the industry, President Muhammadu Buhari had directed that all necessary mechanisms should be activated to curb oil theft in particular and immediately end other forms of economic sabotage in the oil and gas industry.

“Action on the directive commenced immediately and is on-going,” he stated.

The commission, he affirmed, thus considers worrisome, the crude loss figures recently being quoted in the media by some operators, given actions taken so far on the issue.

To ascertain the veracity of the claims, the commission, Komolafe explained, has activated all the necessary mechanisms to get to the root of the matter and establish the actual volume of crude stolen as against the volumes claimed.

While stepping up efforts to deal with the issue of oil theft in collaboration with the military and other relevant agencies, the commission, he added, has mandated the newly constituted panel to investigate the claims regarding the volume of theft from the various oils fields.

Furthermore, part of the points of reference was for the committee to establish the actual operational capacities of the operators; to find out if the volumes being touted are actual; and if so, what additional measures need to be put in place to effectively address the issue.

“While a stakeholders’ meeting has been called to discuss the matter with a view to jointly address the situation, the commission, at a meeting of its management meeting on Monday 21, activated its technical and commercial mandate to demand for the statement of financial accounts of the operators and reservoir accounts of productive oil wells for the last two years.

“This will entail both sales audit and reservoir audit to establish correlations between their technical and commercial activities vis-a-vis the monitoring and evaluation records available to regulatory agencies,” Komolafe stated.