Escalating Crude Theft and the PIB: Examining the Operability of Community Surveillance
The discovery of Oil in commercial quantity in South Eastern Nigeria in the 1950s came with much joy and great expectations from both the peoples of the region and the nation at large. These expectations were borne out of the benefits that would accrue to the people and the nation through the exploitation of these resources. The people were really attached to their resources just like a farmer whose land has yielded abundant harvest would not be surprised if his children are expectant of increased standard of living.
Nigerians especially the people closest to the sources of Oil were expecting that these finds would translate into better urban and rural infrastructure; good road networks, increased access to basic Medicare, better schools to enhance education both quantitatively and qualitatively and generally an expanded Socio-economic space for greater participation of the people both in Governance processes and in the economy.
The passage of time however, has proved how illusory those expectations were. Instead, the lot of the people have become an environment that is increasingly becoming uninhabitable for human beings, decaying infrastructure and exacerbated deprivations and deepening sufferings in people’s daily lives. Also, while all these are happening the people are inundated with reports of massive and unprecendented corruption. They hear how billions and more recently trillions of Naira meant for the improvement in their welfare are brazenly stolen by those in power. They recall that these billions and now trillions that are brazenly stolen come from the oil that is in their community.
These dashed hopes caused serious disenchantment amongst the masses and increasingly separated them from their resources and instead of the original joy that the resource was viewed with, it became an object of regret, disappointment and something that should be viewed with trepidation. Everything therefore associated with it, the flow stations, the pipelines and all manners of conceivable installations began to be seen as instruments of impoverishment and the furthering of misery amongst the populace.
One of the immediate consequences of this refusal to heed the several and diverse warnings and predictions of the adverse resultant was that the people sought aggressively to help themselves where the government has failed in order to mediate these contradictions and provide for themselves some measures of succour.
Since then, both organised and unorganised destruction of Oil installations have been on the increase. Most of these were done because of the economic benefits derivable from it while others were carried out as a mark of resistance and protest to the skewed nature of wealth creation and distribution in Nigeria especially as it affects the Oil wealth and the communities. Most of the incidences were targeted at stealing products both crude and refined which are then sold internationally or refined locally into products.
The NNPC and the Ministry of Petroleum Resources have in the past few days released figures of the huge resources lost to these practices both in volume and in value. It is however estimated that Nigeria is currently losing some 250,000 barrels of Oil per day to Oil thieves. Most of these thefts are carried out by the outright sabotage of Oil facilities especially the Pipelines and the flow stations from where products are taken for sale. Essentially Nigeria loses between U$6bln to U$12bln per annum.
However, these estimates are for just crude loss and nothing has been said about the loss from refined products when we consider the numerous blow outs and the Arepo persistent incident including the value of the equipment and lives lost in the process.
The NNPC/Shell Petroleum Development Company Joint Venture recently declared a force majeure on Bonny Crude due to persistent crude oil theft, resulting in the shutting in of 150,000bpd. Just across the 97-kilometre Nembe Creek Trunk line, 53 break points were discovered. Also Agip has suspended crude oil production activity in Bayelsa state where 60% of its production of about 90,000 kbpd is stolen.
By government’s own admission what is lost to crude oil theft alone is about 10% of Nigeria’s total crude oil production of about 2.5million barrels per day (MMbpd) . This is almost two and a half times the total production of our neighbour, Ghana.
This level of oil theft is a very serious threat to our national security and our democracy as people who are making such humongous amount of money can destabilize both our democracy and our National security. The experience of Columbia, Afghanistan and other countries where criminal gangs have established organizations should prompt the federal and state governments to act very fast before the situation gets out of hand. Also the painful damage to the environment due to crude oil vandalisation and oil theft cannot be overemphasised. The eco-system of the Niger Delta has been greatly violated and unfortunately this aspect of the cost of crude oil theft has not been given sufficient attention!
Although the Section 8 of the Miscellaneous Offences Act provides for life imprisonment for anyone stealing crude oil or petroleum products or vandalizing the pipelines, hardly is anyone caught or prosecuted. It is obvious the oil thieves have powerful allies in government. It is also clear that the security agencies are complicit in this menace of our national resource and government needs to step up to the plate and summon the required will to fight this patent threat to our nation.
The truth is that the continued unabated theft of crude oil will obviously lead to divestment by the oil and gas companies and the attendant socio-economic crises and significant job losses as a result. The communities will also be negatively impacted. The situation of Warri should be a sad reminder of the shape of things to come if the menace of oil theft is not seriously addressed. For instance no body few years ago could imagine that Shell could pull out of
I want to clearly inform you that if nothing concrete is done to stop oil theft , the oil workers unions (PENGASSAN and NUPENG)may be forced to suspend production of crude oil and supply of petroleum products until appropriate action is taken. The impact of this ultimately on overall revenue from Oil accruing to the Federation Account should be negative and severe as was alluded to by the NNPC recently.
Our country is bleeding and needs help! Various solutions have been proposed and one of such is the involvement of Petroleum Host Communities as being proposed in the 2012 Petroleum Industry Bill.
We have therefore gathered here to ask ourselves whether the provision in the proposed PIB, which provides that petroleum host communities should ensure safety of Oil installations in their locality will be used to effectively stem this haemorrhaging of our national Oil wealth; whether this will be an effective mechanism against the sophistication in the operations of some of the vandals and the status of the people alleged to be involved in it especially at the backdrop of last week’s Wikkileaks revelation that certain individuals high-up in Government are actually the main culprits behind majority of the thefts. And to further ask ourselves whether it is justifiable for some of us who are workers of the industry to threaten industrial action if nothing is done to check this increasing menace.
WHAT DOES THE PIB SAY?
The Petroleum Industry Bill (PIB) is an attempt to harmonise all the Laws directly affecting the operations of the Oil and Gas industry and bring it into alignment with the demands and dictates of our modern society, the tenets of international standards and best practices and much more to make the Industry more responsive to the needs of the Nigerian economy and the exigencies of our polity. That is the idea and amongst several other provisions, the Bill being proposed makes provision in Section 118, subsection five, requiring Communities to safeguard Oil installations in their various communities.
The implications of this responsibility are that these communities may be held accountable in the event of any vandalisation of Oil installations in their localities. What then were in the minds of the sponsors of this Bill that made it imperative that this clause be inserted? We have tried to adduce the following reasons or assumptions for this insertion.
THESE ASSUMPTIONS ARE:
Pipeline/installations’ vandals are locals: One of the basic assumptions for this insertion is that most of the thefts of Oil are carried out by locals. This is however not entirely the truth as recent revelations have shown that while the several cases of small breakages here and there may have been the handiwork of locals, the theft through these sources are not up to 30% of the entire heist. However the other 70% which is done with the active collaboration of those in authority and military top hierarchy is a highly sophisticated operation which most of the time do not require breakages but a breach of the major transport points. Assumption number one therefore has a huge challenge and would pose serious problems to the effectiveness of the provision in the PIB.
Consequences of vandalisation are immediately felt by the host community: This is very valid as both the direct acts of breaking pipelines to steal Oil and other associated activities along the theft – chain have wrecked the immediate environments where these facilities are installed. It is not only in environmental degradation and its corollaries but also in the lives that were lost while such activities were being executed. Communities therefore on the strength of this should take steps to protect themselves with or without the provisions of the PIB given the inability of the Security agencies to contain the criminals.
Installations are hosted by communities: A popular saying that it is the duty of the host to protect his guest holds true here. It is therefore the moral duty of the Communities to protect these Oil installations. However, herein lays one of the basic contradictions in the Oil and Gas equation in Nigeria; that Oil equipment and installations that are supposed to belong to the people are classified as “GUESTS” given the implications of the definition of the term “host communities”. It is an aberration with deep consequences for the smooth operation of the industry.
They know the terrain very well: Flowing from the above is the understanding that because these installations are established in places owned by some of these communities, they therefore know the terrain very well and can therefore provide better surveillance and protection to such installations. They know the dangerous zones and the flashpoints and would easily police the environment thus guaranteeing safety to the installations.
Communities cooperate with vandals: Whether the communities collude with the vandals or not, fact remains that it is assumed that because some of the vandals mingle with the communities, they are therefore shielded from the Law enforcement agents. They also assume that the communities point out the vulnerable portions of every installation and guide those interested in stealing products to the best place to attack. However, when vandals with sophisticated arms invade a community, hold them to ransom and move products from Oil installations, the alternatives are slim.
Some are because of community agitations: It is also believed that most of the locally driven thefts are actually signs of deeper malaise in the polity. This means that they were carried out as a sign of protest against the State and the continued degradation of their respective environments. Agitations against innate inequities, injustice and deprivations apparently made oil installations targets for the expressions of such feelings.
HOW WAS IT DONE BEFORE?
Having seen the basic assumptions that formed the plank upon which this provision was made, it becomes imperative that we ask ourselves what the existing platforms are for the safeguarding of the nation’s Oil installations.
It is important that we state as a matter of fact that the issue of security on this expanded scale was never a consideration from the beginning because the people were naturally not hostile to the installations. The installations were not seen as hybrids but as part of the land and were thus accorded the same natural protection that were given to communal properties. However, as the economic and political realities became more manifest, measures for safety on installations became urgent and since then has moved from one level of sophistication to the other.
Internal Company’s Security was initially deployed to ensure minimal security and sometimes patrol identified trunks, but that proved inadequate as the spate of theft increased and weapons and equipment used became more sophisticated. The Police and the specially trained pseudo-police or the ones popularly called SPY Police became the order of the day. The SPY were essentially sponsored by the JVCs; their training, logistics and salaries were the direct responsibilities of corporate organisations operating within the Oil and Gas industry. We still remember that when we were all growing up, they were called Oil Police.
When this was also proving less effective, Private security firms were used to augment internal securities but those ones soon became less effective. The Nigeria Security Civil Defence Corps were deployed strategically along some of the Pipeline networks but there are still overwhelming gaps. Recently, the JTF which came to essential curtail the activities of Militants within the Niger Delta, had an added responsibility which is to ensure the safety of Oil and Gas installations,
Paradoxically, with all the training and sophisticated equipment in the hands of the JTF, Oil theft has rather increased giving rise to serious insinuations of collusion between the security operatives and the groups involved in Oil theft in the Niger Delta.
In the wisdom of the Goodluck Ebele Jonathan led Government, contracts worth Billions of naira were awarded to some ex-militants to provide security for Oil installations. Despite the controversy surrounding this award, this measure according to the Federal Governmenthas helped in stabilising to some extent Oil output in Nigeria. What it has not done however is that it has also failed to reduce the problem of Oil theft, which is seriously on the rise.
With all these measures failing, what then should be done to complement them and reduce to manageable level the continued loss of Oil revenue to crude theft in the Niger Delta. We then turn our eyes to examine how effective this provision that demands communities to safeguard Oil installations within their communities will be.
HOW EFFECTIVE WILL COMMUNITY POLICING BE?
It will undoubtedly improve security of Oil installations and contain the micro oil thieves but whether it will stern the organised and highlevel stealing of the crude oil by organised syndicates with their powerful allies remains questionable. Nevertheless, Let us examine the strengths and the weaknesses of this provision. They are;
Sense of proprietary: The first thing this provision does is that it rebuilds the psychological disconnect between the communities and the Oil installations. The people are given a sense of ownership no matter how vacuous it may be to the installations in their communities. This proprietary sense creates in them the necessary passion and drive needed to ensure the protection of such installations from both internal and external criminals. As the integrity of the installations are increasingly assured, it becomes difficult for crude theft to be carried out in those areas.
Communal alert/watch is triggered: With the provision, a security consciousness is activated in the community increasing the awareness of the need for everybody in the community to make contributions towards the safety of the installations. It would definitely lead to the creation of community vigilantes that would be charged with ensuring the safety of these installations.
Civic responsibility and duty is built: The provision endues in the communities a sense of responsibility as enshrined in the Law. This sense of responsibility increases civic consciousness thus duty. With the building of communities with higher civic responsibilities, increasing civic action becomes the necessary outcome. This civic action is what will be channelled towards ensuring the safety of oil installations in the communities.
Increases community commitment: When Communities realise that the condition attached to accessing the community host fund is the safety of Oil installations in their locality, commitment to ensuring success is increased. As commitment increases in the communities, oil installations become well policed thus theft of products is reduced proportionally.
Empowers the youth/community through job creation: A necessary flow from this is that communities would become more empowered as more funds come into them that would be used for greater economic activities. Direct jobs for the youth are also created as those that would form the safety committees and actually police the installations would be employed full time. This, takes away more youth away from criminal activities some of which have direct bearing to the vandalisation of these Oil installations. Taking more people away from pipeline breaking through job creation and empowering the communities through fund injection means that there will be less participants involved in Oil theft and, the communities will not treat kindly anyone that wants to take away their means of empowerment.
Sabotages when carried out are easily and quickly contained: The communities know some of the vandals and could easily trace the culprits when a successful crude robbery operation succeeds. They can easily provide security for maintenance teams to access breakpoints and carry out maintenance activities quickly. This reduces loss of products thus revenue.
This provision may have been well intended but we know that it is actually based on some false assumptions. It is also designed to deal with symptoms of a deeper issue than going deeper into the roots to solve the problem. However, it could be discerned that those who crafted the Bill never had any intention of the communities replacing the security agencies in the provision of security for the nation’s Oil installations. Rather, their role is designed to be complementary.
In playing this complementary role, we anticipate the following challenges:
Paucity of effective capacity by locals: The critical capacity to effectively guarantee the safety and security of Oil installations in the communities is clearly insufficient in the communities. Since this entails the mounting of full security operations given the nature and character of crude theft operators, we are worried that the communities may lack the critical mass needed to effectively stop the organised operators.
Capability to deliver surveillance and protection is low/skill gaps: The know-how or competence needed for intelligence gathering, technical monitoring of installations like pipelines that are not close to areas where community members live will pose a serious challenge to the operability of this provision. Anybody with the skills that are needed for these operations are already employed elsewhere and are therefore not available for use in the communities.
Deployment of technology requires large capital outlay: Needed technology to effectively carry out the mandate of this provision requires huge capital investment, which we know is beyond what the communities can provide. If the needed tools cannot be procured, communities cannot function effectively in this regards and that, poses a serious challenge to the effectiveness of safeguarding Oil installations.
Logistic and technical challenges: There will surely be operational logistic problems that will arise in the course of the communities prosecuting such a mandate. Coordinating the exercise and creating effective platforms to interface with other communities and the larger security network will surely be daunting.
Misuse of weapons: We are worried about the weapons that would of necessity be provided for the communities to be able to discharge their assignment as a result of this provision. Is it not possible that they may fall into the wrong hands eventually or be used for some other purposes other than what they were supposed to do? These possibilities are indeed frightening.
May increase the militirisation of the region: This will surely make arms more preponderant in the communities, creating military enclaves all over the communities. This is not very healthy for socio-economic development and may in the long run create bigger problems not only for the communities but for the entire region and nation.
May make squabbles over territory more violent because of the introduction of arms: We have witnessed inter communal crises within the Oil bearing communities and we have seen how deadly and destructive they can be. Our concern is that when you introduce legitimate arms into such environment, grievances that would have been settled amicably through dialogue may become more violent.
May create local warlords: The likelihood of creating local warlords will increase with the implementation of this provision. This will allow individuals to carve out niches for themselves and with personal ambition coming in, what may happen can only be imagined. Will this not put weapons in the hands of those whose ambitions may likely tomorrow overshadow the intentions of peace and safety in those regions and turn them into warlords
We have posited somewhere already that the problem arose out, in part , of the alienation of the people from their resources. We state with responsibility that where a group of people only witness the destruction and degradation from Oil production and another group somewhere else captures the development; where a group is thirsty for water but sees it pumped out of wells from their land only to be transported through pipelines that passes their backyard to quench the thirst of his neighbour kilometres away; Oil installations and Pipelines become reminders of; deprivation, alienation, disease, impoverishment, exploitation, cheating and outright wickedness. This is also the reason behind the Niger Delta militancy. Unfortunately the root causes of the Niger Delta agitation, which started as an intellectual and ideological struggle have been left unattended and instead only temporary appeasement is being undertaken in the name of amnesty programme. Amnesty has now suddenly become the elixir for every kind of violence against the Nigerian people, while the victims of such violence are left unattended!
There is also the failure of the Nigerian state to rise up to its constitutional responsibility of effectively securing lives and properties. It is our thinking that addressing the security failure is as important as addressing the social justice issues.
We therefore suggest,
The disbandment of the Nigeria Security and Civil Defence Corp(NSCDC) and the transfer of the yearly budget provisions for the NSCDC to increase in the Petroleum Host Community host fund: Given the obvious failure of the agency to address pipeline vandalisation which is the main reason for their establishment , they should be disbanded with immediate effect and their budget provision used to increase the petroleum host communities fund .
Head-on fight against corruption. The increase in oil theft in Nigeria is directly proportional to the level of corruption in Nigeria. Corruption weakens the institutions of governance and makes it difficult for government officials to do their job . It also creates a culture of greed that destroys everything on its way. The inability of the government of Nigeria and its security agencies to fight the menace of oil theft can be directly linked to the unprecendented level of corruption in Nigeria. The proceeds of oil theft are shared between the oil thieves and their government and security collaborators.That is why nothing concrete is done about oil theft in Nigeria. Painfully , the situation will not change until government shows the political will to fight corruption by severely punishing corrupt government officials and security agents.
The National Assembly should use the opportunity of the PIB to order the Genetic fingerprinting of Nigeria’s Petroleum assets so as to stop the big oil thieves. This will enable the identification of stolen crude oil from Nigeria in the international market.
Complete review , overhaul and reorganisation of the security functions in Nigeria so as to better position them to their constitutional duty of security of lives and property. Also the identification and punishment of the bag eggs in the JTF to serve as effective deterrent.
Setting targets for the JTF and declaring War against Oil theft :
The Federal Government must set clearly defined targets for the Joint Task Force for the purpose of ending oil theft. JTF unit commanders whose units cannot meet those target should be investigated and disciplined accordingly. Disciplinary measure should include dismissal from service especially where their performance is far away from the target. The reduction and stoppage of oil theft must be taken as a war. And any officers who is found wanting should be treated as a Enemny of the Nigerian state and punished accordingly.
Further politicisation of “petroleum host community” should be stopped immediately: To avoid being labelled a country of unserious people, it is important that we should stop this attempt to trivialise what represents “host community” in the provision. The NASS is therefore urged to clearly define what constitutes “Petroleum Host community” so as to remove every ambiguity that may become impediment for its implementation.
Training of locals (security capability/use of technology): If this is to work effectively, the need for training of the locals or the community to imbue them with the needed skills for protecting the installations becomes very urgent. It is important that they are brought to an appreciable level a knowledge of the relevant technology for mounting surveillance on such installations, dictating break points, intelligence gathering etc.
Provision of logistic support for communities: We suggest that Communities be supported logistically when the PIB becomes operational to ensure effectiveness.
Increased and continuous targeted advocacy and education in the host communities: The Oil industry and the relevant Governmental agencies should embark on continuous advocacy to the communities to unequivocally show them reasons for the protection of the installations against the vandals. Constant education of the people as to the dangers of giving cover to the Oil thieves not only to lives and property but to also their environment including the economic disadvantage that it brings to their respective communities will encourage the people to rise up to the challenges of safeguarding the Oil installations.
Government need to purge itself of rogues sabotaging efforts from within: To ensure the operability of this provision, we urge the Federal Government to purge itself of those colluding or financing Oil theft in the country. When products are stolen at the point of loading by misrepresenting the actual figures, how will the host communities account for that? This version of the theft is the most virulent and the dimension actually responsible for a larger proportion of the on-going theft of the nation’s oil.
The allegation that by Wikkileaks be investigated: Finally, we strongly suggest that the allegation by Wikkileaks that some dead former military men turned politicians including active politicians and top security operatives in the country are the major sponsors running the Cartel responsible for stealing the nation’s Oil be properly investigated. This is on the strength of the fact that majority of the information coming from this medium concerning Nigeria have turned out to be credible.
IMPLICATIONS OF INDUSTRIAL ACTION BY OIL WORKERS ON THE INDUSTRY
Nigerian workers in the Oil industry have legitimately, responsibly and patriotically threatened to embark on Industrial action if nothing is done to contain the present spate of theft of the nation’s Oil. It is believed that rather than continue churning out products that would end up being stolen by some cartel, it is better to stop production completely. That it is reasoned would stop Oil from flowing through the Pipelines making products unavailable for theft. Though this is very logical but it has serious implications for the health of the Oil industry and indeed the nation’s economy.
Let us examine some of the reason that we have adduced for embarking on this action. They are:
REASON FOR THE THREAT TO GO ON STRIKE
Increased incidences of vandalisation
Increasing threat to the lives and properties of workers
Deepening threats to jobs of Oil workers
Operational difficulties experienced by Oil companies (If the companies do not operate, is there any need working?)
To stop vandals from cornering the nation’s oil wealth
IMPLICATIONS ARE DIRE AND VARIED DEPENDING ON HOW DEEP IT IS PURSUED
As we have pointed out earlier, the implications are dire but the threatened action is legitimate and would become an instrument of last resort if the needed political will is not mustered by those who run Governmental apparatus to finally resolve this issue once and for all.
Below are some of the consequences:
loss of volume
loss of revenue by implication
May lead to political instability
Lead to feedstock gaps to Gas facilities
Reduction in electricity generation across the nation
Will further undermine the integrity of the installations
With the international energy agency reporting that Nigeria is currently losing about U$9bn annually to Oil theft, it is not surprising that the nation’s budget office is fidgeting as a result of fears that there may be budget shortfalls this year. What should be the response of the relevant stakeholders to this phenomenon? Will this provision be made effective and mobilised towards stemming the haemorrhage? Is there the relevant political will to pursue its drastic reduction given the stature of people involved in the organised theft of the nation’s oil?
The President of the Senate, David Mark having viewed the implications of the rising theft of the nation’s oil resources has advocated a death sentence on people found guilty of stealing the nation’s oil wealth. We are worried that that the Life imprisonment provided for by the Miscellaneous offences Act have not been effective and therefore wonder how death sentence will become effective. We think that the problem is deeper and requires the concerted effort of all concerned. Much of the energy should be directed to implementation of existing laws on oil theft and pipeline vandalism, addressing the social justice issues that provide ideological justification for the practice, using the technology of finger printing of Nigeria oil and taking advantage of the opportunity provided by the petroleum industry bill.
Thanks for listening to me!
Comrade Chika Onuegbu
Do not hesitate to leave your opinion in the comment section below.
To contact Abusidiqu.com for Article Submission and Advertisement or General inquiry, send a mail to firstname.lastname@example.org