Nigeria records 1,600 pipeline vandalism cases

The Minister of State for Petroleum
Resources, Dr Ibe Kachikwu, says Nigeria
has recorded 1,600 cases of pipeline
vandalism since January.
Kachikwu made the disclosure at the 2016
Annual Conference of National Association
of Energy Correspondents with the theme,
“Low Oil Price: Impact and the Way
Forward”, in Lagos on Thursday.
The minister also said that the country
recorded over 3,000 pipeline vandalism
cases from 2010 to 2015
He said that the impact of attacks on oil
and gas pipelines was that there was no
money to fund the 2016 budget.
He said that militancy in the Niger Delta
had destabilised the country’s oil industry,
adding that Nigeria needed to increase its
production by 1.1 million barrels per day to
meet its target.
The minister said that declining price of oil
in the international market had negatively
impacted the country’s revenue leading to
economic recession.
He said that proactive steps were required
to bring Nigeria’s economy back on
positive track.
According to him, while vandals wreak
havoc on oil facilities and cripple local
production, over-supply of product in the
market is affecting prices and creating
shocks to the economy.
Kachikwu said time had come for the
country to face the reality of the time as
there was no assurance that the price of
oil would peak as being speculated.
He explained that OPEC merely controlled
30 per cent of the market while 70 per
cent was in the hands of major producers,
such the U.S., Russia and Mexico, which
were not OPEC members.
He said that the industry was challenged
by six billion dollars cash call indebtedness
accumulated over the last five years.
The minister said that with inadequate
financing of the industry, no investment
had occurred in the sector in the last five
years.
He said 643 million litres of petroleum
products amounting to N51.28 billion was
lost in 2015, while between January and
June a loss of 109 million litres of
petroleum products and 560,000 barrels of
crude had been recorded.
He said that about 850 million standard
cubic feet of gas production had been lost
from crises and power outage exposure of
2,700MW. to 3,000MW.
The, minister said government was
stepping up efforts to make robust policies
that would finalise and gazette a
comprehensive gas policy, unlock gas
potential and ensure effective development
of Nigeria’s gas market.
He said the policy would help to transit
from gas flare penalty regime to gas
commercialisation and shift focus from
government built to investor built
infrastructure.
Kachikwu said for the industry to rebound,
efforts should hinge on developing National
Oil, Gas, Downstream, Fiscal Reform
policies as well as the Petroleum Industry
bill.
He said that local refineries would be
scaled up to attain full capacity from the
present 60 per cent and added that by
2018, the country would reduce
importation of products and finally cease
product import by 2019.