The Group Chief Executive Officer of the Nigerian National Petroleum Company Ltd, Mele Kyari has revealed how the company working in partnership with security agencies uncovered and deactivated over 5,000 illegal crude oil points in the Niger Delta region.
He said this in an interview on Channels Television, Business Morning program where he commented on efforts to tackle insecurity and crude oil theft across the Niger Delta.
The NNPC Boss stated that illegal refineries at a time supplied the total diesel consumed in the country, noting that at a particular time, diesel importation into the country was near zero while there was no diesel scarcity in the country. This meant that the total consumption was from these illegal refineries.
He also noted that efforts of the federal government through security operatives have achieved significant results going by the decline in illegal refineries being destroyed across the Niger Delta.
He said, “When we started this process of deactivation in 2022, we deactivated 8,684 illegal refineries. They are not refineries, just boiling points, we don’t know what name to call them.
“Then you have integral connections to the pipeline, we had 6,610 illegal connections to the pipeline, and we have removed about 5,913, which means we still have over 1000 that have not been removed and they are there, they connect every day that we remove
“At a point, you may not be aware, imports of AGO in the country were almost nil and there was no scarcity of AGO in the country. They are all boiling and at a point everywhere you go, it is the same AGO that is coming from these creeks that we are using all over the country.”
He also revealed that petrol smugglers exploited subsidy loopholes, making around N17m per truck in neighbouring countries.
He explained that cross-border smuggling was common due to the fuel subsidy, with a 6,000-liter truck netting smugglers no less than N17m per trip.
Kyari noted, however, that the same truckload would generate no more than N500,000 if sold within Nigeria, for instance, in a state like Borno.
He said, “In the last 47 years, PMS has always been subsidized and subsidy is creating arbitrage that means there is a difference between price in one location, lower than what it should be in another location.
“And when Mr. President announced subsidy in June, what he did was recalibrate the price. There is no longer any value in anyone taking the product across the border. If you do, you’re not going to make those profits than you do.
“In a 6,000-litre truck, you can gain up to N17m from just one truck. How are you going to stop someone who with two trips can just easily make N17m times two—which is the price of the truck itself?
“However, when you take a truck legally maybe N8m, say, to Maiduguri, your legitimate value is less than N500,000. Why will I see N17m and then take all the trouble go to Maiduguri, keep it in the fuel station for one month and then make N3 to N4m? So, you see, as long as you are not in a subsidy regime, you won’t lose money.”