Dr. Ogbonnaya Orji, the Executive Secretary of the Nigeria Extractive Industries Transparency Initiative (NEITI), revealed on Monday that the country experienced a significant loss of $1.84 billion in petroleum products from its refineries over a nine-year period.
This announcement was made during the opening ceremony of the 2024 NEITI board retreat and meeting held in Lagos.
Orji disclosed that between 2009 and 2018, Nigeria lost 4.2 billion litres of petroleum products due to oil theft, which translates to an estimated 140,000 barrels per day. “Figures contained in our 2009 to 2020 audits have put Nigeria’s losses to crude oil theft over a 12-year period at 619.7 million barrels valued at $46.16 billion or N16.25 trillion,” Orji explained.
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He added, “Similarly, between 2009 and 2018, the country also lost 4.2 billion litres of petroleum products from refineries valued at $1.84 billion.”
The Executive Secretary emphasized the detrimental impact of these losses on the nation’s economy. He highlighted that the previous administration had established a special panel on oil theft and losses to investigate the situation and seek solutions. NEITI had also conducted a report with recommendations aimed at curbing oil theft in Nigeria, and Orji urged the current administration to consider and implement these recommendations.
The five-day retreat, according to Orji, provided a platform to discuss strategies to tackle the challenges of oil theft, illegal mining, pipeline vandalism, and other governance issues that have negatively affected revenue and investment opportunities in the country.
In his remarks on energy transition, Orji expressed concerns about the economic threats posed by the global shift from fossil fuels to renewable energy. He noted, “Our country, Nigeria, is heavily dependent on oil revenues for survival. It is within the ambit of this board to support our government and citizens with timely policy decisions and strategies to deal with this unavoidable unfolding development in the extractive sector.”
Orji warned that the decreasing global demand for crude oil could have severe long-term consequences for Nigeria’s economy. He highlighted the fiscal challenges Nigeria has faced due to short-term disruptions in crude oil and gas output and cautioned that a permanent decline in demand would have even more significant implications.
“While the transition from carbon-based fuel will have a significant long-term impact on Nigeria’s revenue and exports, the transition would also have other impacts on the economy. A direct consequence of the transition would be the loss of fossil fuel as a source of energy,” Orji stated.
He explained that in 2021, crude oil and gas accounted for 46% of energy use and 78% of electricity generation in Nigeria, and transitioning to renewable energy would require substantial financial investments to bridge the gap.
