IN a bold move to curb oil theft in Nigeria’s oil-rich Niger Delta, the federal government has approved a $21 million contract for the installation of meters in 187 flow stations.
Flow stations are facilities where fluid, usually natural gas or crude is gathered from a pipeline and processed. The fluids are then transported to another location, typically a refinery or natural gas processing plant.
The minister of Petroleum Resources (Oil), Heineken Lokpobiri who disclosed this to journalists in Abuja on Friday, July 12, said the move is geared towards improving transparency in Nigeria’s oil sector business.
He informed that the intent is to guard Nigeria’s oil resources as they remain the mainstay of the nation’s economy and would provide a database on the movement of Nigeria’s crude and a tracking centre for crude oil export.
The minister also disclosed that another contract has also been approved to allow the government to monitor advanced cargoes to track the movements of Nigeria’s crude oil.
He explained that the contracts that were approved by the FEC have 180 days (six months) completion period.
“One of the key decisions of the Federal Executive Council on Wednesday has to do with the awarding of the contract for metering of our 187 flow stations across the Niger-Delta region of Nigeria by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
“As part of the reforms to ensure that we have proper accountability, the Federal Executive Council (FEC) approved the metering of all our production and we have 187 flow stations in the country, littered across the Niger Delta area so that we would be able to properly account for what we produce and what we export. It’s a major, major development that will happen in this country, “he added.
The minister noted that it’s important that Nigerians know some of the key steps that this government is taking to ensure it maximises its oil and gas resources for the development of the country.
“As part of the steps towards ensuring that we account for what we produce and then Nigerians get the maximum value for what we produce, the second memo that was approved by the Council has to do with what we call advance cargo.
Commenting on the importance of tracking the flow stations, he said the technology when installed makes it easier to track the movement of the crude through “advance cargo”.
“For instance, from Forcados terminal crude oil is loaded, I can stay in my office and know when it’s taken off from Nigeria up to the final destination. You will agree with me that most of the time we talk about the issue of oil thefts, major steps have to be taken. But this is the time for us to take very, very major steps so that we know from the beginning what we produce to the point of loading from our terminals up to the point of destination”.
He explained that the main objective of the contracts “is for us to ramp up production and improve the federation revenue.
He noted that reforms put in place by the administration have increased investors’ confidence in the Nigerian environment adding that in the coming months, the government expects major investment decisions that would “amount to tens of billions of dollars”.
The ICIR has earlier reported that the Nigerian National Petroleum Company Limited (NNPCL) has declared an emergency on crude production and oil theft as Nigeria struggles to meet the allotted quota of 1.7 million barrels per day by the Organisation of Oil Exporting Countries (OPEC).
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.