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Government loses N10b daily to oil facilities’ attack

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pipeline• Oil production disruption to continue till 2017, says EIA
• Militants announce cessation of hostilities, list terms for peace

With the series of attacks carried out by the Niger Delta militants in the last few weeks, the country’s crude oil production has dropped to about 1.1million from the normal output level of 2.2 million barrels per day.

Using the international benchmark of crude oil price of $50 per barrel, the Federal Government is losing $55 million or about N10 billion daily as the militants vow to continue to destroy oil facilities in the Niger Delta.

United States Energy Information Administration (EIA) therefore expects Nigeria’s oil and gas production disruptions to remain relatively high till 2017.

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But a militant group, the Reformed Egbesu Boys of Niger, yesterday expressed support for the Federal Government’s peace process thereby aligning themselves with the unilateral declaration of cessation of hostilities towards oil and gas assets in the Niger Delta by various militant organisations.

Meanwhile, as modalities for the Federal Government’s dialogue with aggrieved Niger Delta militants are being put in place, three former militant groups from the region have applauded the exclusion of the Chairman of the Amnesty ‎Implementation Committee, Brig. Gen. Paul Boroh (rtd) from the Federal Government team.

Nigeria had in March recorded crude oil loss of N5.94 billion to vandalism while N4.87 billion was spent on pipeline repairs and management cost.

Specifically, the Nigerian National Petroleum Corporation (NNPC) which had confirmed a drastic slump in total export receipt due to the shut-in of about 300,000bopd at Forcados Terminal following Force majeure declared by SPDC on February 15 , 2016, hinted that all un-lifted February and March cargoes were deferred until the repair is completed. It was learnt that Shell is yet to complete the repair of the damaged export line.

The country has since April 2015 been witnessing decrease in crude oil earnings dropping from $340,222,160 million to $98,305,490 in March 2016, according to NNPC figures.

Nigeria’s gas proceeds have also declined from the $123,190,134 earned in April 2015 to $72,571,896 in March 2016.

With the recent attack on oil facilities in the Niger Delta, there is the possibility that the country may earn less in the coming months.

Though the Minister of State for Petroleum, Dr. Ibe Kachikwu, said that the country was losing 800,000 barrels per day to militants’ attack on pipeline, the recent attack in the last two weeks may have brought the quantity of losses to over one million barrels per day.

The Niger Delta Avengers claimed on their official website that they have been able to bring down the country’s crude oil production by about 1.4 million barrels per day.

For example, Chevron’s RMP 23 and 24 wells, which the militants blew up last week, are said to be producing about 200,000 bpd crude oil.

Exxon Mobil’s production was approaching 300,000 bpd, close to the initially planned exports of 317,000 bpd.

Also, Bonny Light exports for July were also pegged at 240,000 bpd, the highest of 2016.

On the short- and long-term implication of the recent attacks, Head, Energy Research, Ecobank Development Company (EDC) Nigeria Limited, Dolapo Oni, stated that the militants during their attacks damaged several facilities which had reduced the country’s output in May to about 1.1 million bpd.

On solutions, he stated: “I think the government is already on the right path, which is to dialogue with the groups and communities. We need to make real change in the Niger Delta. Provide jobs, infrastructure and social amenities for the people.”

Insisting that the Ijaws were not a conquered people, the Reformed Egbesu Boys of Niger Delta stated they were not comfortable with some aspects of the demands by the Joint Niger Liberation Force and the Avengers.

They stated that the Niger Delta agitation was about resource control and true federalism and end to inequality “where our farmlands have been divided into oil blocks amongst Nigerians to the exclusion of the Ijaws.”

They called for a political solution to be explored by the negotiation team to resolve the issues between Government Ekpemupolo , better known as Tompolo, the former Movement for the Emancipation of the Niger Delta (MEND) leader and the Federal Government .

Denying that the Ijaw agitation has anything to do with Sambo Dasuki and Nnamdi Kanu even though they sympathise with them, the group listed their demands to include: commencement of academic activities at the Maritime University at Okerenkoko, Delta State, restructuring of the amnesty programme with upward review of funding to accommodate more beneficiaries and to sack Boroh as the coordinator of the programme.

They also demanded the increase of derivation to 50 per cent and this to be paid directly to communities through appropriate structures and release and pardon of all persons currently in various detention facilities and creation of Niger Delta Investment and Development Bank.

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They also want oil majors and related agencies such as the Petroleum Trust Development Fund to create 6,000 job slots while warning political jobbers to stay away saying: “We are totally against political jobbers and those who are in cozy hotels purporting to be negotiators for the agitators. The negotiation team must be true reflection of the people.”

Beyond applauding his exclusion, the former militants urged Buhari to investigate the Amnesty Implementation Committee headed by Boroh.

A statement by the former militant groups, under the aegis of the Ex-Militants for Peace and Justice by its leader, Target Toruafagh known as ‎”General Bush Man”, posited that the contribution of the Amnesty office in the search of the new militant group and the outcome of interactive sessions with stakeholders showed incompetence.


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