Nigeria to combat oil theft and illegal bunkering
Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, said at a press briefing in Washington DC that the government would resort to withdrawals from the Excess Crude Account (ECA) as an interim measure to ward off any threat to the economy. Nigeria has a balance of $7 billion in ECA.
“In dealing with the impact of this on revenue, the government has had to draw on the Excess Crude Account (ECA), which was set up precisely for this purpose; that is to deal with unanticipated losses due to output and price variation. “The president has been briefed on these developments and action is presently being taken on different fronts. He (president) has ordered the navy to increase its patrols around the hotspots for oil theft and illegal bunkering,” she said.
Giving an insight into the state of the nation’s economy, she explained that Nigeria is losing a total of about 300,000 barrels per day arising from recent shut-in of Shell Nembe operations, shut-in owing to force majeure declared at Qua Iboe Terminal, which has led to a loss of 65,000 pbd and other losses , including those by Agip, and at Okono, Brass and Amenam Terminals due to repair work on equipment.
In addition, the economy has suffered great loss due to the activities of oil thieves and pipeline vandals, all which has led oil production to fall to between 2.1 and 2.2 mbpd as against the 2013 budget projection of 2.528mbpd. The loss, she added, translated to a drop of $1 billion in revenue per month.
She said government has been aware of the ominous threat to the budget and that was why it has taken proactive steps to stem the losses.
According to her, the Minister of State for Finance, Dr. Yerima Ngama, had at the last session of the Federation Account Allocation Committee (FAAC) meeting alerted the nation to the fact that government was feeling some pressure on its finance arising from the volatility in the oil sector.