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Why we engaged NNPCLtd, stakeholders on transparency in oil, gas sector – Reps




THE chairman, House of Representatives committee on anti-corruption, Shehu Garba, said the legislative transparency and accountability summit that the committee organised was meant to promote accountability and transparency in the oil and gas business.

Garba, saying this on the sidelines of the event that held in Abuja on Wednesday, November 9, 2022, stressed that it would be difficult to realise the nation’s potentials in the oil and gas industry if everybody lacked transparency and accountability.

The Senate president, Ahmed Lawan, described the engagement as a welcome development in the light of Nigeria’s recent experience in which revenues from oil and gas had been declining because of the lack of transparency in the sector.

Lawan, represented by the chairman, Senate committee on anti-corruption and financial crimes, Suleiman Kwari, said, “It has become even more worrisome given the place of oil and gas in the nation’s revenue earnings. Theft of oil has been alarming, resulting in our inability to meet our production quota and the failure to attain projected revenues.

“Added to this are leakages and wastages from improper records at the time of dwindling national resources where funds are required for growth and development.”

The speaker of the House, Femi Gbajabiamila, said that amid the evolving paradigms at the global level, the oil and gas industry still faces unique challenges here at home, a situation he believed could be tackled through enhanced transparency and accountability.

Gbajabiamila said that due to theft and various acts of economic sabotage, Nigeria was experiencing a massive decline in crude oil production and export volume.

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He lamented that the country was the victim of bad actors determined to achieve great personal wealth at its collective expense.

“At a time of severe financial constraints, the perpetrators of this brazen heist threaten our ability to meet the demands of governance and nation-building. Their actions effectively amount to treason against our country, for which they must be held accountable.

“At the same time, we cannot be ignorant of global trends, and we cannot wish the facts away. And the reality is that the best days of the fossil fuel industry are not ahead; they are long past. There is a coming, and some might say, ongoing shift in the global policy conversation about the economics and regulation of the oil and gas industry,” he said.

The speaker, represented by the deputy majority leader of the House, Peter Akpatason, noted that the summit was particularly important for legislators and policymakers to gain valuable insights into the issues and achieve clarity on the actions they need to take to achieve greater transparency and accountability in the oil and gas industry.

The group chief executive officer of the Nigerian National Petroleum Company Limited (NNPCLtd), Mele Kyari, said he had received several death threats in the course of tackling oil theft and sharp practices in the sector.

Kyari said the scale of oil theft was enormous with over 200,000 barrels lost at peak of production, while 700,000 barrels were recorded as opportunity lost.

He disclosed that pipelines had been taken from the company’s main trunk lines to abandoned platforms, although two had been restored.

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He said, “Companies will stop injecting oil into the pipeline the moment they discover it can’t get to the terminal. Therefore, at the peak of production, you lose over 200,000 barrels per day. But once companies discover this production won’t get to the terminal they will terminate it. So we are losing up to 700,000 barrels of opportunity.

“In terms of stealing that we have been able to restore, two of our trunk lines after the discoveries we have made. We were left with no choice than to involve private security contractors, and that works. They are complementing our government security agencies and they have done a great work. The Navy, Army and etc, everyone has made contributions.

“Lastly, this industry is in shortfall of a change, I have several death threats to myself. This is the cost of change. When people walk away from things they are used to, to something that’s new, something that will take away value and benefit from them, they will react.”

The NNPCLtd. boss said it would be a significant change for the energy sector to become completely transparent and accountable, stating the company was striving to ensure that the sector’s systems are automated and processes respect policies.

On agreements with multinational oil companies, Kyari said, “The strength of any agreement is the capacity of active members who negotiate these contracts. Partners do take advantage of their partners, it happens. But there’s a common rule in the oil and gas industry that when you take advantage of your partner, you will come to realize it years later and it pays back at you.”

He asserted it would not be possible for a consumer to buy fuel at N165 per litre when the actual cost of the product was far from the value.

“We need to understand what this subsidy means. Today when petrol comes into this country, we transfer to the marketers at N113 for us to realize N165 at the port,” he explained.

Author profile
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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.

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