Nigeria loses $150million in revenue every other day from pipeline vandalism and sideline production, Umar I. Ajiya, the chief financial officer (CFO) of the Nigerian National Petroleum Corporation (NNPC) Limited has said.
Umar revealed this while speaking on Arise TV on Wednesday after the NNPC Group Managing Director, Mele Kyari said on Tuesday, that the Company has uncovered an illegal 4km pipeline from Forcados in Delta State to the sea and a loading port that has operated for the last nine years.
During Ajiya’s interview on Arise TV, he admitted that pipeline vandalism had impacted NNPCL operations significantly, especially in this era of high oil prices.
He said: “At a point in this country, we had reached 2.3 to up to 2.7 million barrels per day just before the Covid-19 pandemic, but with the incessant vandalism and theft, our operators can no longer tolerate such theft levels that you send 100 barrels and you probably get 10 barrels at the terminals, so, as a consequence of that, some of them have declared force majeure and shut-in, so it is deferred production and consequently deferred revenue for us and the nation.”
While addressing the N674bn revenue increase for the fiscal year 2021, Ajiya said that certain factors were responsible for the profit.
He said during the year under review, every NNPCL business was held accountable and this helped to increase revenue and drive down costs. According to him, an automated funds management system ensures that businesses do not spend beyond a certain percentage of the revenue they make.
He said: “We have tender approval limits set for the businesses; so, the contracting pass has significantly been curtailed and the final say for contracting passes has to happen at the headquarters without compromising operational efficiency and safety.
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“We have tried to optimize resources and expenditures where it is absolutely necessary, we have reduced the overhead costs in the refineries, reduced the manpower levels at the refineries, and redirected the workforce at the refineries to the businesses that require the additional workforce.”
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