Nigeria seeks to curb oil theft with $21 million measurement contract

In an effort to address the persistent problem of oil theft in the Niger Delta, the Federal Government of Nigeria (FG) has awarded a $21 million contract for the measurement of 187 crude oil flow stations.

This initiative, approved by the Federal Executive Council (FEC), is a significant step towards increasing transparency and accountability in the national oil and gas sector.

Minister of State for Petroleum Resources, Heineken Lokpobiri, who disclosed this at a press conference in Abuja, stated that the initiative would provide greater clarity on the volume of crude oil produced in the country as well as the amount exported to other countries.

He said, “Two days ago, the Federal Executive Council meeting was held, chaired by Mr. President, where we took some very bold steps to reshape the oil and gas sector. One of the major approvals by the Federal Executive Council was the award of contracts for the measurement of our 187 flow stations across the Niger Delta region of Nigeria by the Nigerian Upstream Petroleum Regulatory Commission.

“NUPRC is the apex regulatory body or commission for Nigeria’s upstream oil and gas sector. As part of our move to ensure that we have proper accountability, the Federal Executive Council approved the measurement of all our production. We have 187 flow stations in the country, and there is a contract given to us to measure all the flow stations so that we can properly account for what we produce and what we export.

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“This is a major development that has never happened in this country. This project was meant to be completed in six months, within 180 days. It is important for Nigerians to be aware of some of the important steps that this government is taking to ensure that we maximize the opportunities that other countries are getting through the availability of oil and gas in Nigeria.”

Reduce Losses and Increase Revenue

Oil theft has long been a drain on Nigeria’s economy, with estimates of losses amounting to billions of dollars each year. Installing meters at flow stations – the points where crude oil is extracted from the ground – aims to provide accurate measurements of oil production. This data will be critical in identifying irregularities and preventing theft throughout the oil production process.

Efficiency and Transparency Concerns

However, questions remain about the effectiveness and long-term implications of the project. Some analysts point to the relatively low cost of the contract, raising concerns about the quality and durability of the meters that will be installed. Additionally, the 180-day timeframe for completion of the project seems ambitious, and potential delays could hamper the initiative’s impact.

Furthermore, the success of this project depends on a strong law enforcement mechanism. The government must demonstrate a strong commitment to holding all parties, including oil companies and any individuals involved in meter tampering, accountable.

Nigeria seeks to curb oil theft with $21 million measurement contract first appeared on Latest Nigeria News | Top Stories from Ripples Nigeria.