Nigeria Loses $1.6 Billion to Crude Oil Theft Annually - Shell

Shell Petroleum Development Company has expressed concern over the activities of crude oil thieves and illegal refineries operators in the Niger Delta, saying that the country was losing $1.6bn annually to oil theft.

The company cited its forced shut down of the Nembe Creek Trunklines, NCTL, in Bayelsa State, a facility which produces about 150,000 barrels of crude oil per day and its declaration of force majeure on Bonny Light export.

This, according to the company, was to enable it remove crude oil theft connections, investigate suspected oil theft leaks and effect repairs.

Speaking at a workshop organised for media practitioners in Yenagoa, Shell Manager, Government/Community Relations, Evans Krukrubo, said over 90 per cent of its pipelines in the region had been ruptured by suspected oil thieves. He noted that the shutdown of NCTL production would impact negatively on Bayelsa's share from the Federation Account.

Oil leak under control - Shell Nigeria

Shell said today it had contained oil leaked from a failed pump within a flowstation on Nembe Creek though local residents disputed this, saying it had spread to mangrove swamps. Shell said it had shut down the oil processing facility over a pump failure, but denied reports that a significant amount of oil had spilled in the area.

The flowstation in the Nembe Creek area of Bayelsa state has been closed. Shell said that “some oil escaped from the seal into the saver pit in the flowstation, with some sheen observed (in the area. The pump has been repaired.” Nigerian NGO Environmental Rights Action sent a team to visit the site and reported that there was a spill. The head of the group, Nnimmo Bassey, described the spill as extensive.

Oil spills from equipment failures or loading accidents are common in the swampy Niger Delta region of Africa's top energy producer.

The Anglo-Dutch oil major says locals sometimes exaggerate the impact in the hope of boosting their compensation claims.  The government and oil firms have pledged to clean up the region and other parts of the Delta, but residents say they have seen very little action.  Armed gangs also tamper with pipelines to steal crude and Shell's Nembe Creek trunk line has been subject to numerous spills in recent years, many due to sabotage.

A landmark UN report in August last year slammed the government and multinational oil companies, particularly Shell, for 50 years of oil pollution that has devastated the Ogoniland region of the Niger Delta. The government and oil firms have pledged to clean up the region and other parts of the Delta, but residents say they have seen very little action.