The Nigerian National Petroleum Commission (NNPC) has reported a spike in oil theft in Nigeria. In a recent report on X (formerly Twitter), the state-owned oil company said it recorded at least 149 incidences of crude oil theft across the Niger Delta region per week. Furthermore, “in the past week, 39 illegal pipeline connections were uncovered, and 49 illegal refineries were destroyed in the Niger Delta,” a statement read.
Unlike in previous years, oil theft perpetrators have advanced in their mode of operations along the oil-rich region of the Niger Delta. They have taken their activities “a notch higher as they utilise CCTV camera technology installed on trees to look out for security operatives. Mortar launchers and defence systems were also mounted by the oil thieves in various locations to eliminate any perceived enemy,” the NNPC reported.
Oil theft in the Niger Delta began in the late 1970s and early 1980s during military rule, spearheaded by top military figures to amass wealth and maintain political stability. With the emergence of indigenous demands for a larger share of oil revenue and the rise of youth militancy, the situation evolved. Initially, the protests in the Niger Delta were primarily political, as residents of the region advocated for a higher share of the derivation fund (a specific percentage of oil rents accrued to the federal government).
However, as these demands went unmet, many young individuals resorted to armed conflict against the government and turned to criminal activities, including kidnapping, oil facility destruction, oil theft, and sea piracy, exacerbating the issue. With each generation, the scenario appears to be evolving dynamically.
“Oil theft is still prevalent in the Niger Delta region due to some critical issues like corruption and insecurity,” an anonymous oil and gas sector expert told Ventures Africa. “Also, those places are largely underdeveloped, making it easy for perpetrators to carry out these nefarious activities in the woods. So, it could take quite a while for security officers to track oil bunkering sites and by then, tons of crude would have been shipped out of the country illegally,” he added.
Last month, during the inauguration of an ad hoc committee tasked with investigating crude oil theft, Tajudeen Abbas, Speaker of the House of Representatives, revealed that Nigeria suffered a staggering loss of $46 billion (N16.25 trillion) due to crude oil theft over 11 years. From January to July, Africa’s largest oil producer experienced a daily average loss of 437,000 barrels of oil to criminal entities and individuals who engaged in illegal tapping of pipelines both onshore and offshore in the Niger Delta region.
In recent times, oil theft has evolved into a significant challenge for the federal government, with the activities of oil bunkers appearing increasingly organised and structured. A key challenge that escalates the oil theft problem in Nigeria is the inability of many local refineries to acquire licenses, the anonymous expert emphasised. That has resulted in people setting up illicit oil bunkering sites across the Niger Delta region.
“But that’s not all, other bigger unnamed organisations are also involved in oil theft, through a grand scheme of corruption with government officials,” he added. Regrettably, a considerable portion of the stolen oil finds its way to foreign refineries or storage facilities, with the profits seemingly laundered through banks and diverse channels in several African nations, including Dubai, Indonesia, India, Singapore, the US, the UK, and Switzerland.