Nigeria loses billions in revenue due to oil theft in the Niger Delta

Royal Dutch Shell has said that oil theft in the Niger Delta, Nigeria, is costing the country billions of dollars a year in lost revenue, as well as putting tremendous pressure on Shell’s Nigeria staff.

The company also said that an increasing number of thefts are significantly impacting the environment.

Thieves have stolen about 150,000 barrels of crude oil a day from pipelines in the Niger Delta in 2009, according to an estimate provided by the United Nations.

Shells’s Nigerian unit, Shell Petroleum Development Company (SPDC), experienced 137 spills due to sabotage and theft in 2012. The volume of oil lost is about 3,300t.

Shell experienced 36 operational spills in 2012, which is 40% less than in 2011.

The SPDC has replaced about 500km of pipeline in the last three years, with plans to replace more of the infrastructure.

"This was an increase in both volume and numbers from 2011, as the scale of oil theft in Nigeria reached unprecedented levels," Shell said in its sustainability report.

In 2012, two contractors working for the SPDC were killed after an armed attack during the assessment of remediation of an oil spill site.

Shell companies chairman in Nigeria, Mutiu Sunmonu, said the highly organised criminal enterprise transports stolen oil to refineries in other parts of West Africa and Europe.

"Where possible, we are taking steps to make it more difficult for the thieves to tap into and steal oil from our pipelines," Sunmonu added.

Onshore production was reduced to 20%, as a result of pipeline shut downs due to oil theft.

The company has urged the Nigerian and international governments, as well as local communities, to take immediate and necessary steps to stop oil theft in the Niger Delta.

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Image: Shell Companies in Nigeria chairman Mutiu Sunmonu. Photo: Courtesy of Shell.