Oil Theft: How Nigeria destroyed over 5,500 illegal refineries in 3 years ─NNPCL Chief

*Mele Kyari, Group Chief Executive Officer of NNPC Limited, notes Nigeria should respond to extant energy challenges in the economy by diversifying the West African country’s energy sources while implementing energy efficiency measures and conservation

In what many have described as economic sabotage of the country’s commonwealth by oil thieves, the Nigerian National Petroleum Company Limited (NNPCL) has disclosed the authorities destroyed over 5,500 unauthorised oil refineries and almost 4,500 illegal pipeline connections in the last three years.

Malam Mele Kyari, Group Chief Executive Officer (GCEO) of NNPC Limited, stated this while speaking as a Guest Lecturer during the 2024 Faculty Lecture, titled, “Energy Security, Sustainability and Profitability in Nigeria: Advances, Challenges and Opportunities,” organised by the Faculty of Science of Obafemi Awolowo University (OAU), Ile-Ife, Nigeria.

Stolen crude at an illegal oil-refining site in the Niger Delta region

Olufemi O. Soneye, Chief Corporate Communications Officer at NNPC Limited, in a recent statement issued in Abuja, FCT,  said the NNPCL Chief, who advocated academia-industry collaboration for energy sufficiency and sustainability, highlighted pipeline vandalism and crude oil theft, as well as rapid population growth, as the main challenges to energy security in the West African country.

Kyari told his audience at OAU, fondly called “Great Ife” by the students and friends of the University, that Nigeria should respond to these extant energy challenges by diversifying country’s energy sources while implementing energy efficiency measures and energy conservation in the process.

In regard to what the Company has been doing in curbing illegal oil bunkering and outright oil pipeline vandalism, Malam Kyari also explained the role of the company’s “Command and Control Centre” in detecting illegal oil facilities around the country.

He noted: “The centre provides livestreaming of surveillance data to security forces, contributing to the detection and destruction of over 5,686 Illegal Refinery sites and the removal of 4,480 Illegal Connections from 2021 to the present.”

“Acknowledging the severity of vandalism and oil theft, Kyari hinted at a strategic shift, focusing on increased products trucking and storage in underground tankages at NNPC filling stations nationwide.”

Kyari further highlighted NNPC Limited’s expanded retail assets, making it the largest single downstream company in sub-Saharan Africa after acquiring OVH retail stations and associated downstream infrastructure in 2021.

In underscoring the Company’s transformation into a fully commercial limited liability energy company following the passage of the Petroleum Industry Act in 2021, Kyari said the removal of fuel subsidies has allowed the Company to play a more active commercial role, ensuring profitability and delivering greater value to Nigeria’s growing population.

The nagging problem of oil theft comes amid a shortage of refinery feedstock in Nigeria, as the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), in December 2023, reportedly had said in a statement that it had met with the Nigerian Midstream Petroleum Regulatory Authority to seek stronger action to ensure domestic crude supply.

The meeting sough to address “the prevailing shortage of feedstock to the modular refineries operating within the shores of the country.”

Likewise, last November, the Federal Government inaugurated a special committee to combat oil theft. In the country’s annual oil and gas fair last year, the oil and gas regulatory body Nigerian Content Development and Monitoring Board (NCDMB) urged the government to address “wanton crude oil theft in the Niger Delta” to “enable the production of hydrocarbons at reasonable costs and profitability”.

“Most indigenous operators were unable to evacuate their crude oil through pipelines for over one year and are now forced to explore alternative options at high costs”, the NCDMB said in a media statement last May.