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RADP / Pulse Ghana  >  business  >  International

Nigeria lost N16.3tn to crude oil theft, spent N13tn on fuel subsidies since 2005

Chinedu Okafor
Fuel subsidy is a serious issue in Nigeria. (PeopleDaily)
Fuel subsidy is a serious issue in Nigeria. (PeopleDaily)
  • NEITI reveals that Nigeria has lost over 619.7 million barrels of crude oil between 2009 and 2020, valued at $46.16bn or N16.25tn. 
  • NEITI also states that N13tn was spent on fuel subsidies in Nigeria between 2005 and 2021. 
  • The NEITI boss, Orji Ogbonnaya-Orji, has called for more advocacy for the conclusion of the Petroleum Industry Act's implementation work and submission of its report to the President.

The Federal Government of Nigeria stated on Thursday that N13 trillion was spent on petrol subsidies between 2005 and 2021. It also stated that N16.3 trillion was lost to oil theft from 2009 to 2020.

At a policy dialogue on oil swap that was co-hosted by the Nigeria Extractive Industries Transparency Initiative and Policy Alert, an indigenous civil society organization, with assistance from the Opening Extractives, it was revealed in Abuja.

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Orji Ogbonnaya-Orji, the executive secretary of NEITI, stated in a presentation that was made available to our reporter that a decision about the campaign to end gasoline subsidies must be taken immediately.

“The figure in relative terms is equivalent to Nigeria’s entire budget for health, education, agriculture, and defense in the last five years, and almost the capital expenditure for 10 years between 2011 2020. It is also important to note other economic opportunity costs of fuel subsidy which include slashing allocations for the health, education, and technology infrastructure sectors,” Orji Ogbonnaya-Orji stated.

“Others include the deterioration of the downstream sector with the declining performance of Nigeria’s refineries and recording zero production in 2020; disincentive private sector investment in the down and midstream petroleum sector; low employment generation since the refining process is done outside the shores of Nigeria; worsening national debt; declining balance of payment, forex pressures and depreciation of the naira and of course product losses, inefficient supply arrangements, scarcity and its attendant queues, etc,” Orji added.

Regarding crude oil theft, he said that information from industry reports and the NEITI policy brief "showed that Nigeria lost 619.7 million barrels of crude oil between 2009 and 2020 (12-year period), valued at $46.16bn or N16.25tn."

According to Orji, Nigeria lost 4.2 billion liters of petroleum products from refineries valued at $1.84 billion between 2009 and 2018, which amounted to a loss of more than 140,000 barrels of crude oil every day.

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“These findings and recommendations on tackling crude oil theft have been submitted to the President through the Presidential Committee on Crude Oil Theft, in which NEITI also served as a member.

The committee has concluded its work and submitted its report to the President. The committee did an excellent job with far reaching recommendations. I will like to commend the Office of the NSA (National Security Adviser) that coordinated that panel’s work,” the NEITI boss stated.

The Petroleum Industry Act's implementation status was also discussed in the presentation, with a focus on the fact that its development had not been made public.

“Not much is in the public domain on the progress of the committee’s work. Civil society should step up advocacies for the conclusion of the committee’s work and submission of its report to the President before the expiration of this administration with clear recommendations to the next administration on what has been done and outstanding work,” Orji stated.

Chinedu Okafor Chinedu Okafor Chinedu is a Senior Reporter at Business Insider Africa with 5 years experience creating profoundly engaging and insightful content.

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