In Nigeria the Senate on Wednesday through its ad-hoc committee on crude oil theft in the Niger Delta, uncovered about $303billion unaccounted crude oil sales.
The alleged unaccounted $303billion oil sales, was contained in the committee’s interim report presented to the Senate during plenary by Senator Ned Nwoko (Delta North). According to the report, a forensic review of domestic crude proceeds and tax oil proceeds records revealed crude oil sale differentials, mismatches and unaccounted funds amounting to about $22 billion.
It further found a shortfall of $81 billion between receipts declared by the Nigerian National Petroleum Company Limited (NNPCL) and those recorded by the Central Bank of Nigeria (CBN) for 2016 and 2017.
The committee also said its review of crude oil sales from 2015 to date, supported by investigations from international consultants, projected that over $200 billion in crude oil sales proceeds remained unaccounted for globally.
The interim report, which followed months of document reviews, written submissions and public hearings, traced the problem to faulty measurement systems, weak regulatory oversight, and poor coordination among government agencies. It identified the use of unverified measuring instruments, lack of meteorological control, ineffective interagency collaboration, and uncoordinated enforcement mechanisms as major enablers of crude oil theft.
The report faulted the suspension of the Weights and Measures Department’s activities in the upstream sector under the Petroleum Industry Act (PIA) 2021, saying the decision undermined accountability and accurate measurement in crude oil operations.
It also noted that the absence of a special court to prosecute oil thieves and the non-implementation of the Host Communities Development Trust Fund (HCDTF) under the PIA had contributed to persistent sabotage and theft in oil-producing areas.
The committee projected that the unaccounted domestic crude sales proceeds amount to about $300 billion, calling for urgent local and international tracking, tracing and recovery of stolen crude oil funds for the benefit of the country.
It urged the Federal Government to mandate the Nigerian Upstream Regulatory Commission (NUPRC) to enforce international crude oil measurement standards at all production sites and export terminals or restore the Weights and Measures Department to its former regulatory role.
The report also recommended that the government provide security agencies with modern surveillance technology and equipment, including unmanned aerial vehicles, to strengthen monitoring of oil facilities and detect theft and leakages in real time.
It called for the establishment of a Maritime Trust Fund to support the development and maintenance of maritime infrastructure, training and safety operations, as well as the creation of a special court to promptly prosecute crude oil thieves and their collaborators.
The committee further advised the immediate implementation of the Host Communities Development Trust Fund (HCDTF) to reduce community sabotage and promote inclusion in the management of oil resources.
In addition to the financial losses, the committee expressed concern over the growing number of abandoned and poorly decommissioned oil wells across the Niger Delta, which it said were leaking oil and gas into the environment and polluting communities.