The Nigerian National Petroleum Corporation, NNPC, has said that Nigeria has lost about $7 billion or more than N2 trillion to pipeline vandalism as well as the activities of Niger Delta militants from January this year till date.
Maikanti Baru, Group Managing Director of NNPC, said this on Friday in Abuja at the 2016 Fiscal Liquidity Assessment Committee Retreat, while delivering a lecture titled: “Global Oil Prices, Militancy and Terrorism and its Impact on Government Revenue in Nigeria’’.
He added that apart from security challenges in the Niger Delta region, politics, judiciary, oil prices and production cost has continued to impact negatively on the oil industry.
“Over 7000kpd of crude oil has been lost due to vandalism this year. A bulk of the loss is from JV assets,” Baru said
“This implies that 60 per cent of oil production lost is NNPC-FGN equity.
“At an estimated price of 45 dollars per barrel, the total 2016 revenue loss to the Federation Account translates to about 7 billion dollars.
“This is money that the government could have used to achieve major infrastructural milestones.
“This loss is equivalent to a new 7,000mw power plant; new 350kpd refinery; over 30 per cent of National budget; and a new 1,700 kilometre pipeline,” he pointed out.
To check the ugly trend, the NNPC boss said the corporation has a plan to increase security of oil and gas assets as well as improve its community social responsibility and the Amnesty programme.
He said the NNPC planned “to renegotiate terms of Production Sharing Contract with deep offshore operating companies because with the current agreement, only 17.7 per cent of total revenue comes to government.”