Opinion: Confronting menace of oil theft

Oil-theft

It is a surprise that Nigeria has just woken up from its heavy inertia to know that the country is losing a substantial volume of crude oil to oil theft and bunkering. These activities are as old as the oil industry. Nigeria cannot shy away from the truth or claim ignorance of the astronomical volume of oil theft for the past 50 years. It deliberately let loose the baby tiger into the wild to mature to a monstrous size and sophistication to evade being caught or detected in the act for several years.

There is a common sense that anywhere in the world where criminals are never caught or brought to justice for a long time, the agents are directly involved or a cartel with powerful links to high profile politicians in protecting the common interests of both parties is involved. The world is very familiar with this phenomenon as we always see in mafia movie plots. You may go to church every day and twice on Sundays, it does not change the way of this world because this world is not a holy place but a hotbed for intimidation, victimisation and terrorism, garnished with condiments of betrayal, greed and corruption.

The unprecedented economic consequences of the immense oil theft have left most serious thinking businessmen and high-value politicians to ponder in their silent moments: “What have we done to get to this state of putrescence?”

It is not that nothing was done in the past. Actually, in the year 2000, NNPC made a very innovative and successful strategy to combat corruption at the Pipelines and Product Marketing Company depots nationwide, reducing pipeline vandalisation and smuggling of petroleum products to neighbouring countries.

A few years back, NNPC was fighting this battle alone, especially the theft through pipeline vandalisation for crude and finished products along system E and 2E NNPC pipelines. The depot pumping station may hardly know the conditions along the pipelines but a receiving depot may notice a drop in pumping pressure (signalling a suspected line break). At this stage, it is impossible to physically inspect hundreds of kilometres of pipeline to detect the exact spot but have to patiently wait for a report from the affected community. Early detection of pipeline disruption was not possible at that time and may still be so today. In the past, it took four to seven days to locate a vandalised spot through the effort of good Samaritans who took it upon themselves to travel long distances to the nearest pipeline depot to report a case of pipeline rupture from either failed integrity of highly corroded pipes or from vandalisation. On receiving such reports, NNPC would mobilise Mobile Police personnel, with selected engineers, to the location for the repairs of the damaged line.

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In the early 2000, NNPC mobilised military and MOPOL to assist to curb the menace but it was later discovered they were part of the problems too. It was nightmare for NNPC

There was a proposal to involve the local communities to constantly monitor the safety of the pipelines passing through their communities in return for monthly payout for work well done. In this scenario, you cannot rely too much on human beings where there is exchange of money as a reward. The highest bidder becomes the master of the business and immediate change of loyalty.

In 1994, a think tank of NNPC then, the Consultancy Services Unit based in Lagos proposed the use of technology to monitor the distribution of Crude and Product lines using the principles of Telemetry/SCADA where NNPC could monitor real time distribution activities of the pipelines along the country’s arteries of pipeline network. Any vandalisation or pipeline break along the distribution lines is instantly detected with a telltale blinking lights or audible alarm displaying the coordinates of the location on the screen. An SOS signal is immediately dispatched to the nearest military base (Airforce, Navy or Army or combined team) for immediate dispatch of anti-terror personnel to swoop the area and contain the menace.

Response time would be such that the vandals would not have enough time to inflict maximum damage. This idea was muted at the presentation venue and did not get to top management of NNPC at that time because of the associated high cost to deploy such technology. That costly decision to mute the idea did not consider the long term cost- benefit implications. If that technology was deployed at that material time, the country would have saved more than $20bn or more to date. Apart from the long term cost saving, the technological experience in managing the pipeline surveillance and security over the years would have been extended to our railway and road networks for same purpose.

This 1995 technology has advanced to modern and faster technology with many adds on (e.g. use of HD video cameras to capture footage needed in identifying and persecuting the criminal bunch in court, SMS, long distance drones, cloud storage, satellites, etc.).

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It is still not too late if we prioritise the need to deploy this technology. The money to acquire this technology can be generated if we can significantly reduce the huge wastage from the three tiers of which are too numerous to mention here. The can reengineer its processes to save cost and improve efficiency in delivery of their goals.

In 2011, the Gulf of Guinea Energy Security Strategic initiative was interested in the curbing of oil theft in Nigeria. The UK Government (Foreign & Commonwealth Office – FCO) offered technical assistance to address the problem of illegally obtained (stolen) crude oils in the Niger Delta. The FCO engaged and funded University of Plymouth, UK to develop techniques capable of resolving the problem. The Federal Government directed NNPC to join in the initiative.

NNPC commissioned its robust Research & Development Division based in Port Harcourt to work with University of Plymouth on identification of Nigerian Crude anywhere in the world which will discourage theft of Nigerian crude. Fingerprinting technology is one of the methods considered to address this menace. Crude Oil fingerprinting (like Crude Oil signature) is an analytical technique to identify key biomarkers in crude or its products or we can call it Hydrocarbon Forensic Geochemistry. The basic principle of the technique is that Crude oil from different reservoirs have its unique fingerprint and information could be used for oil spill identification, source identification of crude, identification of formations that are actively producing, solve production allocation problems.

At the end of the day, the fingerprint of most Nigerian crude was almost completed and further works were necessary to identify Nigerian crude from a mixture (commingling) with other foreign crudes. The challenge was the immediate acquisition of more sophisticated analytical equipment to complete the investigation. NNPC R&D division made a presentation on this study (as a promising tool to stop stealing Nigerian Crudes for easy detection anywhere in the world) to the office of Minister of Petroleum in 2013. A promise was made by the office to release $350,000 for immediate purchase of HIGH RESOLUTION TIME-OF FLIGHT (TOF) MASS SPECTROMETERS (GC-GC-TOF-MS) and GAS CHROMATOGRAPHY COMBUSTION ISOTOPE RATIO MASS SPECTROMETRY (GC-C-IRMS).

The purchase of the equipment did not see the light of the day and that was the constraint to conclude the high end research to establish a base to identify Nigerian stolen crude anywhere on this planet. It is good to let Nigerians know that the NNPC R&D division was at the time (and may be till now) the most equipped laboratory in African continent with developed capabilities to carry out many complex oil and gas studies that were being done overseas saving several millions of dollars. By 2013, they had developed capabilities to study and advise the on oil pollution, atmospheric pollution, specialised core analyses, complete crude oil assay, advanced geochemistry, catalysis studies for the refineries, gas utilisation studies, enhanced oil recovery etc. .

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If the means business, to stop the oil theft it should invite NNPC R&D division, Nigeria Upstream Petroleum Regulatory Commission, multinational and national oil companies to meet and come up with solutions to put a final stop to the old problem that has wreaked the nation below its productive organs of survival.

The oil theft can be decimated through combined use of Advanced Warning and Detection Technology, Policy and Judiciary. The local vigilante group can be a useful catalyst in this drive for intelligence surveillance and information gathering. It is long overdue to overhaul the security of our national asset or we are gradually preparing a groundbreaking recipe for self-implosion.

For the public knowledge, NNPC Research and Development outfit was set up at the same time with NNPC via the Federal Government April 1977 ACT No. 33. Most times when a war or a battle is won, nobody hears about those intellectuals and intelligent community that worked 24/7 behind the scenes to support and enhance the outcome of the victory. It is now time for the Federal Government to wake up, make an early morning call to challenge and push the intellectual community of our great nation to start solving national problems through aggressive research and innovation. No nation on this planet thrives in this highly competitive age without a solid foundation in Pure and Applied Research.

  • Obaigbena is a retired Group General Manager in the NNPC Research & Development Division

Contact: [email protected]

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