Following an attack by militants on Bonny – Okrika crude supply line to the Port Harcourt refinery and the Escravos-Warri crude supply line to the Kaduna refinery, the Nigerian National Petroleum Corporation (NNPC) has announced the shutdown down of these two refineries.
The militant attack on pipelines came on the heels of a court order to arrest of the Niger Delta Kingpin, Tompolo who has been dogged with controversy and allegations of corruption. The Nigerian Delta region which has experienced relative peace since 2009 after the amnesty talks with the federal government might witness fresh attacks amidst the vandalization of pipelines
These attacks on pipelines are come at a time when these refineries just started gaining momentum. However, the federal government has affirmed its stance to tackle resurgent militancy, oil theft and acts of vandalism in the Niger Delta region.
Here are ripple effects of recent militant pipeline vandalism
- Daily loss of money amidst fall in global oil prices
The resultant effect of the closure implies the NNPC has lost about 5.4 million litres of fuel with amounts to about N1.7 billion loss in four days while the repairs of the damaged pipeline is estimated to costN120 million
“The sabotaged gas pipeline which contributes to the Escravos Lagos Pipeline System (ELPS) has led to a loss of 160 metres standard cubic feet per day (MMSCD) of gas daily. At a cost of $2.50 per thousand standard cubic foot (scf), this loss means about $400,000 loss to the country on a daily basis (N78,800,000 daily) in gas volume,” Nigeria’s Minister of Power, Works and Housing, Mr Babatunde Fashola said.
- Electricity supply might worsen
The supply of electricity across the country might worsen in coming days due to the loss of about 800 megawatts of power as a result of the blasting of the Escravos Lagos Gas pipeline.
According to Federal Ministry of Power, the immediate impact of the sabotage on the gas facility has been the disruption in the sale and supply of 160 million metres standard cubic feet per day (MMSCD) of gas to operators of electricity generation facilities and a cut in electricity supply from the affected power plants. With the current national power generation capacity at an average of 4,120 MW, the impact of this incident is unimaginable.
- The return of fuel queues
Prior to the closure of the two refineries, Port Harcourt refinery was recording a daily production of over 4.1 million litres while Kaduna refinery was posting a daily petrol production of about 1.3 million litres. He added that the Warri Refining and Petrochemicals Company (WRPC) are still on stream and producing a little above 1.4 million litres of petrol per day. The NNPC faces an uphill task to maintain stability in the supply and demand of petroleum products across the country.