Stemming the collapse of Nigeria’s oil Industry

The recent outcry by Shell Petroleum Development Company (SPDC) over the continual loss of 60,000 barrels daily to the criminal activities of oil thieves and illegal oil refiners is disturbing. Estimates made by Nigerian Extractive Industries Transparency Initiative (NEITI) for the period 2009-2011 reveals that Nigeria lost $10.9 billion to crude oil theft and vandalism. According to a Bloomberg survey, oil output fell to 1.92 million bpd in July. The loss is stupendous – 400,000 barrels daily according to Ngozi Okonjo-Iweala. In other words billions of dollars that should accrue to the government disappears everyday into the pockets of individuals.

Many concerned Nigerians continue to ask who these economic saboteurs are. Are they beyond the Nigerian state or they receive backing from those in power? Why do their brazen criminal activities evade the rule of law?

For a country that depends on crude oil sales for up to 80 per cent of its revenues and 90 per cent of its export earnings, and considering the reality that crude oil is a finite resource, it appears the revenue foundations of Nigeria is sliding steadily to collapse. It is more disturbing that in the face of this continual loss of revenues, and the imminent collapse of the oil industry due to the perennial sabotage of pipelines and illegal refining, government authorities have continued to dawdle with double-tongued expressions that offer no concrete solutions, or plans towards ensuring that the goal of increasing reserves to up to 40 billion barrels is achieved.

Neither the president nor the minister of petroleum have come up with a comprehensive plan to tackle simple issues like metering the oil Nigeria pumps daily and  they expect Nigerians to believe that government can  handle more complex issues like achieving 182 trillion cubic feet of gas and deploying gas resources to fuel power. Peddling fantasies of potential jobs to Nigerians is disingenuous and deceptive. First things first: stop the leakage in the roof before proposing a new design for another building.

The scale and sophistication of oil theft in the Niger Delta coupled with piracy in the Gulf of Guinea suggests that the crime is being committed by highly placed persons who seem to have access to the corridors of power. Because there are no constraints or deterrents, pillagers and murderers benefit immensely from this and thus are encouraged to commit more heinous crimes.

We observe that a consequence of this brigandage in Niger Delta is environmental damage that may ignite more rebellions, whether out of genuine grievance or the greed of opportunists. Widespread poverty in conflict-prone parts of Nigeria, like Bayelsa in the south and Borno in the northeast, pushes the unemployed youth to enlist as militants or terrorists. Decent infrastructure in the form of basic social amenities like education, electricity and health, is far removed from Nigerians in Ogbia and Maiduguri. Though the Joint Task Force (JTF) has stemmed the tide of violence, a palliative at best.

We suggest that concrete steps be taken towards halting this dangerous and self-destructive trend that will do us no ultimate good. No more double-tongued speeches, enough of deceptive political statements couched in future tenses (with the full knowledge that nothing will be done). We believe that passing a sensible PIB will be the place to start. This might be the opportunity for the national assembly to prove that a hyper-affluent micro-minority is not eating the breakfast, lunch and dinner of Nigerians.