Stakeholders seek solution as vandals break 45,347 pipeline points in 18yrs
The menace, which rose to 77 percent in recent times, have grave implications and remained a major barrier to the nation’s revenue, the aspiration to boost crude oil reserves, affect investment climate and return on investment.
Speaking at the event, which was organised by the Pipelines Professionals Association of Nigeria (PLAN), Group Managing Director of Nigerian National Petroleum Corporation (NNPC), Mele Kyari said the 45,347 breached downstream pipeline network took place between 2001 and half year 2019.
The development has led to the award of multi-million dollar pipeline surveillance contracts by the state oil firm, with losses rising as much as N155.4 billion both in terms of cost of crude and product losses as well as pipeline repairs and maintenance.
Managing Director of Aiteo Group, Victor Okoronkwo, operator of one of Nigeria’s strategic pipeline; Nembe Creek Trunkline (NCTL) had told journalists that vandalism cost the company losses standing at $2 billion in the last four years.
In 2018 alone, a total of 19 fire incidents were recorded on the petroleum products pipelines, kyari told participants at the conference.
Director, Centre for Petroleum, Energy Economics and Law (CPEEL), University of Ibadan, Prof. Adeola Adenikinju had told The Guardian that projected national revenue, as well as industry forecast, would remain a mirage if the situation persists.
“This is occurring at several levels. First, it impacts negatively on federally collected revenue. Our budget is based on projected oil prices and oil production. Theft reduces the volume of oil exports and government revenues. This impacts the ability of government at all levels to perform their fiscal responsibilities, including the level of public investments,” Adenikinju said in a telephone interview.
The NNPC GMD equally admitted that it would be difficult for the oil and gas industry to deliver much value to the economy without effective and efficient pipeline operations.
“As a major player in the oil and gas industry, NNPC operates over 5,000 kilometers of pipelines traversing many communities to link terminals, 3 refineries and 20 depots for efficient transportation of crude oil and refined products. In addition, NNPC has over 1,700 kilometers of natural gas pipelines to supply gas to power plants and gas-based industries, including deliveries to trans-national reception points,” Kyari said.
He lamented that these huge pipeline assets have become difficult to operate efficiently as a result of incessant activities of vandals and other criminal syndicates that were becoming increasingly sophisticated.
Chairman of PLAN, Geoff Onuoha, described the nation’s pipelines as the arteries driving the prosperity of the national economy, assuring the management of NNPC of PLAN’s support to enable her to run its pipelines efficiently.
Director-General of the Infrastructure Concession Regulatory Commission, Chidi Izuwah, advocated for the adoption of the Public-Private Partnership (PPP) model as a solution to the funding challenge hampering the expansion and modernisation of the nation’s infrastructure.
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