• ‘Militarised approach insufficient, get broader collaboration’
• Savannah Energy records 15% increase in oil production

Despite Nigeria’s yearly expenditure of N201 billion through the Nigerian National Petroleum Company Limited (NNPC) to secure oil facilities, crude oil theft remains widespread.

In 2024, the Nigerian Navy recovered just N5.6 billion worth of stolen crude (approximately 6.5 million litres or about 40,000 barrels), an amount equal to the country’s estimated daily loss, highlighting the limited effectiveness of current efforts to curb illicit financial flows in the extractive sector.

The Nigerian Navy’s 2024 efforts under Operation Delta Sanity resulted in the arrest of 215 suspected oil thieves, the impoundment of 26 vessels, and the destruction of 468 illegal refinery sites. While these statistics reflect some operational success, they remain negligible compared to the scale of crude oil losses the country continues to face.

Data from the Nigerian Extractive Industries Transparency Initiative (NEITI) revealed that Nigeria lost approximately 619.7 million barrels of oil, valued at N16.25 trillion, to theft between 2009 and 2020. In 2022 alone, the estimated revenue loss from oil theft was $23 billion, dwarfing the Navy’s yearly recovery efforts and raising questions about the effectiveness of the current security architecture.

The NNPC’s latest audited financial report showed that the N201 billion spent yearly (an average of over N16.7 billion monthly) is allocated to surveillance contracts aimed at combating oil theft. However, stakeholders argue that the persistence of theft and pipeline vandalism highlights structural and institutional challenges undermining national revenue and investor confidence.

Renowned energy expert, Prof Wunmi Iledare, described the situation as a paradox of progress and dysfunction. While acknowledging the Navy’s achievements, he cautioned that militarised interventions alone would not resolve the deeply entrenched crisis.
Iledare noted that arrests and refinery shutdowns signify a more proactive security posture in the Niger Delta but stressed the need for a holistic strategy. He advocated for a restructured and technologically advanced NNPC to lead the national response, integrating enhanced surveillance systems, community engagement, security, legal reforms, and international cooperation to disrupt the global market for stolen Nigerian crude.

Additionally, he stressed the importance of full transparency from the NNPC to rebuild public trust and spearhead governance reforms addressing the root causes of oil theft rather than merely its symptoms. He highlighted the urgency of reforms in contract administration, judicial efficiency, and international collaboration, particularly with countries serving as transit points for stolen crude.

MEANWHILE, community stakeholders in the Niger Delta have expressed growing frustration with the current state of affairs.

Chairman of the Board of Trustees (BoT), Community Development Committees of Niger Delta Oil and Gas Producing Areas (CDC), Joseph Ambakederimo, criticised the Navy’s recurring reports, describing them as a “broken record” that no longer inspires confidence.

Ambakederimo questioned the rationale behind the continued expenditure of vast sums on pipeline surveillance, despite persistent breaches and losses. He argued that entrenched interests benefiting from the chaos might be sabotaging lasting solutions.

He proposed a near fool-proof strategy involving the identification and engagement of operators of unlicensed refineries, offering them alternative livelihood options. According to him, individuals involved in illegal refining could be retrained and integrated into the formal economy through skill acquisition programmes in metallurgy or fabrication, providing a legal outlet for their expertise.

The BoT chair also cited rivalry among key actors in the region as a significant impediment. He explained that some surveillance contractors are unable to access certain camps due to long-standing animosities, creating zones where oil theft remains unchecked.

He called for an expanded surveillance framework that includes all key stakeholders, arguing that fostering patronage and collaboration would result in broader coverage and reduced crude oil losses.

In a separate development, British independent energy company, Savannah Energy Plc, reported strong financial and operational gains in its first quarter 2025 trading update in Nigeria.

The company recorded a 19 per cent increase in total revenue to $73.3 million, up from $61.4 million in Q1 2024. This growth was driven by the completion of its acquisition of Sinopec International Petroleum Exploration and Production Company Nigeria Limited (SIPEC) and the expansion of the Stubb Creek oil field.

Cash collections rose to $124.8 million, while cash balances stood at $110.4 million as of the end of March 2025, a substantial increase from $32.6 million in December 2024. Net debt during the period fell to $597.8 million and would have further reduced to $570 million, excluding SIPEC-related obligations.

Savannah also reported that the average gross daily production in Nigeria was 23.6 thousand barrels of oil equivalent per day during the period, broadly consistent with the same period last year.

Since the SIPEC acquisition, production at the Stubb Creek field has risen by 15 per cent, reaching 3.1 thousand barrels per day in April 2025. This growth is part of an ongoing expansion programme aimed at increasing output to approximately 4.7 thousand barrels per day.

The company announced significant growth in oil reserves at Stubb Creek, with Gross 1P reserves up by 197 per cent and 2P reserves rising by 29 per cent. These increases follow enhanced reservoir modelling and field monitoring protocols, underscoring Savannah’s long-term prospects in the region.

Also, Savannah noted that its $45 million gas compression project at the Uquo Central Processing Facility is nearing completion, with one compressor already operational and a second set to be commissioned before the end of June. Plans are also underway for a two-well drilling campaign at the Uquo Field later this year, which has the potential to unlock additional gas resources and sustain output growth.