A day after the news broke that the Nigerian government was engaging in dialogue with militants vandalising crude oil pipelines, Maikanti Baru showed up at the Defence Headquarters, Abuja.
The Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, made a passionate appeal to the Nigerian military to help secure critical oil and gas infrastructure and curb the losses incurred by the Corporation due to pipeline vandals and oil thieves.
Baru’s “strong delegation of NNPC Top Management”, on a courtesy call on the Chief of Defence Staff, General Gabriel Olonishakin, was significant body language from the head of the state hydrocarbon company that military action against vandalism was still a preferred option on the table.
The Buhari Government had, in June 2015, a month after it took office, terminated the pipeline surveillance and protection contracts awarded to both ethnic militia and other individuals by former President Goodluck Jonathan.
Baru told the Chief of Defence Staff: “From January to May 2016, almost 1,447 cases of pipeline hacking was recorded resulting to a loss of 109Million litres of petrol and 560,000 barrels of crude oil to refineries posing a great threat to the nation’s economy and the 2016 Federal budget. Olonishakin responded that that the Defence Headquarters and the armed forces were duty bound to support and provide the NNPC with all necessary security support because of its strategic role in ensuring the economic survival of the nation.
Baru stated that over 3,000 vandalism incidents were recorded every year from 2010-2015. In 2015 alone, pipeline losses of PMS volume of over 643Million litres valued at over N51.28Billion was incurred. “The 2016 National budget plan was based on 2.2Million barrels per day of crude oil production. However, the budget plan is now grossly impacted due to renewed militancy: with about 700, 000 bpd of oil production curtailed due to pipeline vandalism,” he said.
The NNPC GMD noted that domestic natural gas supply to power is equally impacted with estimated drop of about 50% from 1,400Million standard cubic feet of gas per day, (MMscf/d), to barely 700MMscf/d, resulting to significant power outage exposure of between 2500MW to 3000 MW as a result of direct and indirect impact.
“Along with this menace is the incessant case of kidnapping of personnel and piracy in areas of operations. Other impacts of these acts include loss of lives, high cost of operations, refinery shut down, fuel crisis and large scale environmental degradation and attendant cost of oil spill clean-ups,” he said.
