Thursday, November 3, 2011

Shell raises concern on unprecedented oil theft in Nigeria

The Shell Petroleum Development of Nigeria (SPDC) has raised  alarm over what it called an unprecedented scale of crude oil theft in the country, saying it has discovered 16 new oil theft points in the “Imo River field alone”.

The oil firm also said 10 additional illegal oil bunkering incidents had been recorded in the Eastern Niger Delta since it shut down production from Imo River field on August 28, following an upsurge of sabotage activities, which had adversely impacted the environment, resulting in deferment of 25,000 barrels of oil per day (bpd).

Shell’s Vice-President, Health Safety and Environment (HSE) and Corporate Affairs, sub-Saharan Africa, Mr. Tony Attah, who made these disclosures in an interactive session with journalists Wednesday, said production from the affected field would “remain suspended until the crude theft and illegal refining activities have stopped”.

He explained that a recent helicopter overfly showed that unknown persons had drilled holes and installed valves to transfer crude to waiting barges and trucks, in the process polluting  farm lands and water bodies.

“We are very disappointed that oil thieves are still at work,” Attah said adding, “This is why we call for concerted efforts to help stop this criminal activity, which not only puts the lives of the perpetrators and the public at risk, but causes severe environmental impact and impacts the communities in the areas. It also wastes badly needed revenue to finance development even in the same areas in which the activities are taking place.”

He restated that more than 75 per cent of all oil spill incidents and more than 70 per cent of all oil spilled from the SPDC facilities in the Niger Delta between 2006 and 2010 were caused by sabotage, theft and illegal refining, adding that since January 1, this year, the company had published data on every spill on the web to further demonstrate the robustness of its oil spill response process.

Attah also revealed that the company was examining ways to bring third party verification to the oil spill investigation process in order to bring further transparency to the assessment of causes and volumes.
To stem the tide, he said the company was deploying new technologies to ensure that new pipelines were buried deeper to prevent vandals from having access to them.

He explained that the deployment of surveillance contract would be maintained to safeguard the existing pipelines.

He said Shell believes in multi-stakeholders approach to the worrisome problem, noting, however, that until sabotage and crude theft spills were stopped or at least curbed, the vast majority of oil spills would continue to impact the environment.

“Nobody else operating in the Niger Delta comes close to this level of transparency. But regardless of how well we run our operations, until sabotage and crude theft spills are stopped or curbed, the vast majority of oil spills will continue to blight large swathes of land and pollute rivers and farm lands,” he said.

He attributed the cause of oil theft to unemployment and poverty, but noted however that these are no excuse for indulging in such sordid acts.

On the report of the study carried out by the United Nations Environment Programme’s (UNEP) on oil pollution in Ogoniland, Attah said Shell was working with the presidential committee to arrive at a desirable action plan for the area.

Towards this end, he said Shell’s representatives last week met with the government and lawmakers to deliberate on what could be “a starting point”.

Last week, the Economic and Financial Crimes Commission (EFCC) disclosed that seven Nigerians and two Ghanaians were last month sentenced to 10 years on each of the nine charges filed against them by the commission for illegally dealing in petroleum products.

Stolen crude and illegally poorly refined petroleum products are often exported and sold on the lucrative black market at neighbouring countries.

Spokesman of the Joint Task Force in the Niger Delta, Lieu-tenant Colonel Timothy Antigha, had said on Monday that a ship laden with 5,000 tonnes of stolen oil and 30 barges, also laden with unspecified quantities of crude and illegally refined oil were impounded in Bayelsa State.

A leaked United States diplomatic cable released by WikiLeaks recently, fingered some unnamed Nigerian political elite and soldiers as among those who profited from large-scale oil theft in the Niger Delta that might have cost the country up to a 10th of its production.

Nigeria is the world's eighth biggest exporter of crude oil but thieves take a sizeable proportion of its output by drilling into pipelines or sometimes hijacking barges loaded with oil.

In the meantime, the SPDC has lifted the force majeure, which it declared on Forcados loadings on October 10, for October, November and December 2011 cargoes as a result of production shutdown due to a sabotage leak on the Trans Forcados pipeline.

Corporate Media Relations Manager, Shell, Mr. Tony Okonedo, said the force majeure, a legal term that frees a company from contractual obligations due to circumstances beyond its control, was lifted effective from 12 noon, November  1, 2011, following completion of repairs of the affected pipeline.

This Day

Related stories: Ship with 5000 tons of stolen oil seized by Nigerian forces

Shell shuts in 25,000 bpd of oil due to sabotage and theft

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