Against the backdrop of recent figures of missing and stolen crude oil put at 200,000 barrels daily by the NNPC Limited, the Chief of Naval Staff (CNS), Vice Admiral Awwal Gambo late on Monday night disclosed that it is practically impossible for such quantity of crude to be stolen daily, given the deployments of Nigerian Navy Ships and other operational platforms spread across the nations maritime domain.
The huge and shocking, but disputed oil theft figures had been given by NNPCL and the Ministry of Petroleum which put the total estimated quantity of barrels stolen per day at between 200,000 to 400,000 per day.
However, speaking as guest of Channels TV, Vice Admiral Gambo clarified that the data may not have emanated from oil theft alone noting that the government agencies were mistakingly attributing/calculating losses due to force majeure, and shut-ins as part of oil being stolen.
He said, “As much as there is no perfect system, the phenomenon of oil theft and losses must be properly de-conflicted in order to profer lasting solutions to the malaise which is currently bedevilling our economic resources.
“We need to understand the differences between oil theft and of course, oil loss. While oil theft is siphoning oil from vandalised pipes into barges, oil losses occur when there is non-production, especially during shut-ins and force majeure as the federal government does not earn the desired revenue it should”.
Explaining further, the CNS said oil losses could be as a result of metering errors on the operating platforms, while the volume of crude oil shut-ins from non-production are often added to oil theft data instead of accounting for them as oil losses by the authorities.
NLC had also criticised the company over the secrecy surrounding the subsidy of Premium Motor Spirit popularly known as petrol.The NLC also alleged corruption in the subsidy scheme in its memo to the House of Representatives’ Ad Hoc Committee on the Volume of Fuel Consumed Daily in Nigeria, which is investigating the actual amount of PMS the country consumes daily.
The National President, NLC, Ayuba Wabba, signed the memo dated June 30, 2022. In the memo, the NLC notes that a school of thought believes that one of the principal reasons for the frequent increase in the pump price of petroleum products is the presumption that Nigeria imports XYZ volume of refined PMS for its internal consumption and the subsidy on this volume is so humongous that it is killing the economy
As if these are not worrisome enough, the Controller General of the Nigeria Customs Service (NCS), Col. Hameed Ali (Rtd) has also faulted the daily consumption figures of petrol claimed by NNPC to justify the over N6.34 trillion subsidy payment on the product annually.
This was made known by Ali on Thursday while making a presentation to the House of Representatives Committee on Finance at the continued hearing on the proposed Medium Term Expenditure Framework and Fiscal Strategy Paper (2023 – 2025) in Abuja.
Ali wondered why the NNPC said that the daily consumption figure of petrol is 60 million litres and then allowed 98 million litres to be lifted daily from the depots.
He argued that the NNPC cannot scientifically prove the 98 million litres per day consumption it was claiming, alleging that the state-owned oil company was supplying an excess of 38 million litres of petrol daily.
NCS Controller General’s Contetention:
The issue is not about smuggling of petroleum products. I have always argue this with NNPC.
“If we are consuming 60 million litres of PMS per day, by their own computation, why would you allow the release of 98 million litres per day? If you know this is our consumption, why would you allow that release?
There is no way I would have sold off that petrol immediately to warrant another load. So, how did you get to 60 million litre per day? That is my problem.’’
While dismissing claims that smuggling of petrol contributes to the huge amounts being paid for subsidy, the Customs boss said, “The issue of smuggling: if you release 98 million litres in actual and 60 million litres is used, the balance should be 38 million litres.
How many trucks will carry 38 million litres every day? That’s almost 500. Which road are they following and where are they carrying this thing to?”
The Subsidy Conundrum:
The subsidy payment is necessitated by Nigeria importing all of its petrol needs because the local refineries have not been working for several years, with Africa’s largest oil producer unable to benefit from the high crude oil prices because they are used to pay for the product.