Nigeria losea $1.4bn Annually on oil theft due to lack of metering system-NEITIsystem-NEITI.

Until the metering system is reintroduced in the oil and gas sector, Nigeria will continue to lose an estimated $1.4 billion annually resulting in oil theft and other malpractices in the sector.

The Nigerian Extractive Industry Transparency Initiative, NEITI, stated this in its latest Independent Audit Reports on the oil and gas and extractive industries.

It said despite the initial approval given to the introduction of metering by the Goodluck Jonathan administration in 2013, failure of government to give the innovation the desired emphasis by monitoring the development had made it impossible to achieve result.

In his comment, Director of Communications, NEITI, Dr. Orji Ogbonnaya Orji, identified non-metering as a major source of revenue loss to the country in the oil, gas and mining sectors.

Throwing more light on the negative impact on the system, he said the negligence had impacted negatively on the country’s economy while the attempt at letting the authorities react towards curbing it had not been followed by the government agencies.

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“Our 2014 Audit Report on the issue was disturbing, as it showed that $4.3 billion worth of crude was lost. This is made up of $4.1 billion reported loss by the companies, $100 million worth of crude reported lost by PPMC, $198.7 million worth of crude lost to OPA/SWAP and another $2.5 million exchange loss on gas.

“There were still some gaps in government providing the needed political will to support NEITI’s commitment towards ensuring that metering infrastructure is put in place in the relevant sectors that need it to stem the tide of revenue losses and in line with international best practices,” Orji stated.

Collaborating the assertion, Mr. Yussuf Sani, the executive chairman of Nigerco Nigeria Limited, an indigenous firm that has been in the forefront in promoting use of metering system in the relevant industries, confirmed that Nigeria lost about $64 million between the second quarter of 2015 and the first quarter of 2017 to poor metering of its oil wells.

He told Vanguard that the Ministry of Industry, Trade and Investment in 2015 appointed his company as the consultant to oversee the issuance of licenses and the meters to oil and gas prospecting companies in the country, but did not follow it up.

According to the CEO, “Non metering of oil wells has led to lack of accuracy in the records of volume of crude oil extracted and exported daily, giving rise to varying figures by local and international sources.

But the public Affairs unit of the Department Petroleum Resources (DPR) reacting on the issue denied that crude oil figures in the country are not being calculated in line with international standard.

“All the terminals handling crude petroleum adopt the backed up by the Static Method of measurement, otherwise known as physical hand-dip measuring, which is done by using recommended steel tapes or Ultrasonic equipment,” the DPR said.













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