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Editorial

Oil theft & sabotage: Nigeria’s predicament  against fortunes of rising global oil price

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Dynamics of global oil prices put critical concerns before Nigeria, particularly with the Country having oil as the mainstay of her economy. Market realities on Wednesday, August 03, 2022, revealed the prices of many crudes, including Nigeria’s Bonny Light, bounced back to over $100 per barrel in the global market as the Organisation of Petroleum Exporting Countries, (OPEC) and its allies, begin their meeting in Vienna, Austria. The rise in prices was reportedly fueled by expectation that the meeting of OPEC and its allies would culminate in determining the group’s production strategy for September 2022 as well as adoption of other measures, capable of achieving stability in the volatile global oil market. Consequently, the price of Bonny Light rose to over $100 per barrel, from $99 while the price of Brent rose to $101.8 per barrel, from $98 per barrel.

Market reports revealed that until last week when the prices of many crudes crumbled, due mainly to the negative data from China, which gave impression that the demand for crudes was easing, the prices had consistently risen, due to some factors, particularly those having to do with the reopening of major economies after the Coronavirus lockdown, Ukraine-Russian war and European Union ban on Russian oil. May 29 report revealed the price of Nigeria’s Bonny Light rose to $141.4 per barrel, in the global market, apparently the highest in recent times. The reality had showed $79.4 per barrel increase over Nigeria’s $62 per barrel budget 2022 benchmark, which was also based on 1.8 barrels per day, including condensate. The market situation was attributed to a disruption in supply following moves to ban Russian oil by the European Union and increasing demand around the world. June 14, the price of Bonny light, was at $126 per barrel.

According to OPEC June 2022 Monthly Oil Market Report (MOMR), price of Nigeria’s Bonny Light, rose year-on-year (YoY) by 70 per cent to $115.07 in May 2022, from $67.61 per barrel in the corresponding period of 2021. The organisation had also disclosed that on month-on-month, (MoM) the price of the crude increased by 8 per cent to $115.07, from $106.39 in April 2022.

Following the rise, experts have observed the relatively upsurge in  price of oil reflecting positivity that will go a long way to swelling inputs into the Excess Crude Account (ECA). However, this also mean the government will spend more to import petrol for domestic consumption.

Despite the rise in the price of crude, the reality of same may be challenged by a number of factors which may affect accruals. Key among these has been the subject of oil theft. Issues bothering on dwindling records in crude production output of the Country, as Nigeria recently began to suffer difficulties to meet 1.772 million barrels per day quota of OPEC has become a subject of concern due to increased strains of oil theft, pipeline vandalism and illegal refining in the Niger Delta.

Amidst the strains of sabotage, report revealed Nigeria’s oil production, including condensate, dropped Year-on-Year (YoY) by 14.3 per cent to 1.4 million barrels per day (mbpd) in the first half (January – June) 2022, from 1.6 mbpd in the corresponding period of 2021, according to the Oil Production Status Report of the Nigerian Upstream Petroleum Regulatory Commission, (NUPRC). The oil output also dropped Month-on-Month (MoM) by 23 per cent to 1.3 mbpd in June 2022, from 1.7 mbpd, recording in the preceding month, May 2022. This showed about 400,000 barrels per day (bpd) shortfall against the 1.88 mbpd, output benchmark in the 2022 budget.

The shortfall notwithstanding, there remain indications that the Country stands the chance to be at an advantage of profound accruals from earning as the price of her Bonny Light has been hovering at over $100 per barrel in the past few months as against $62 budget benchmark.

This would, however, demand firm management of the system, and concerted strategic measures to address the prevailing strains. Shell Petroleum Development Company (SPDC), in a recent briefing, had observed that “most oil spills in the Niger Delta continue to be caused by crude oil theft, the sabotage of oil and gas production facilities, and illegal oil refining, including the distribution of illegally refined products. In 2021, all the spills caused by sabotage and theft that were recorded by Shell globally, were in Nigeria. The number of these spills decreased to 106 in 2021 from 122 in 2020, while the volume of these spills increased to 3.3 thousand tonnes from 1.5 thousand tonnes in 2020. Shell companies in Nigeria believe that the number of incidents in 2021 continued to decrease because of sustained security deterrence and surveillance.

“The doubling of the spill volume was mainly because of a single incident, accounting for around 2.3 thousand tonnes of crude oil. The incident resulted from sabotage to a wellhead where the oil flow had to be stopped before any repairs or recovery could take place. At the site, the wellhead slot and a natural containment area prevented the oil spill from spreading and therefore more than 90 percent of the oil was recovered and returned to the system,” the Company had noted.

Commenting on the ugly trend recently in June, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) Limited, Mallam Mele Kyari, was quoted, “As we speak now, there is massive disruption to our operations as a result of the activities of vandals and criminals along our pipelines in the Niger Delta area. This has brought down our production to levels as low as we have never seen before. Today, we are doing less than 1.15 million barrels per day simply because some criminals decided that they should have some infractions on our pipelines. That is clearly the biggest form of business disruption that we are facing today.” Similarly, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), had disclosed that about $3.27 billion worth of oil has been lost to vandalism in about 14 months. The Chief Executive of NUPRC, Engr. Gbenga Komolafe, was quoted, “A major consequence of this nefarious activity is the declaration of force majeure at Bonny Oil & Gas Terminal, BOGT and shut-in of wells from fields evacuating through the Nembe Creek Trunk Line, NCTL and the Trans Niger Pipeline, TNP. A consequential effect of this menace is that the nation only achieved about 60 percent compliance with Technical Allowable Rate, TAR and 72 percent of its assigned OPEC quota. The challenges that stem from this issue include, threat to national and energy security; Erosion of global competitiveness and ease of doing business; Rise in unemployment across the industry; Increase in conflicts due to proliferation of arms; Widespread HSE and community concerns etc.”

Putting in place measures to check against oil theft and its associated sabotage have become important for Nigeria to escape the strains of shortage in production output below the quota given to her by OPEC. Continuous initiatives to prevent and reduce spills caused by theft or sabotage of oil facilities, particularly in the Niger Delta, is pertinent. Efforts must be made to  ensure sustained security deterrence and surveillance; introduce stronger anti-theft protection mechanisms for key infrastructures, such as well heads and manifolds to help deter theft; sustained on-ground surveillance of  areas of operations of oil firms, including  pipeline network, to mitigate third-party interference; and developing a formidable system of response to ensure that spills are detected and responded to with alacrity. Hence, stringent measures for systemic firmness to curb the menace of oil theft and sabotage must be instituted, while addressing, strategically and intelligently, the informing factors of the menace. These measures are pertinent to ensure the nation maximise the benefits of the positives in rising global oil prices.

Editorial

Nigeria’s Human Rights conundrum: A call to urgent action

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Nigeria’s human rights landscape has long been a cause for concern, but the latest revelation by the National Human Rights Commission (NHRC) paints a particularly dire picture.

The shocking disclosure that 1,580 human rights violations occurred in March 2024 alone is a stark reminder of the precarious state of human rights in our country.

Even more disturbing is the breakdown of these violations, which reveals a disproportionate impact on the North Central region and a troubling involvement of state actors, including the police, military, and DSS.

This crisis of accountability and protection demands urgent attention and action from all stakeholders, and it is our hope that this editorial will contribute to a much-needed national conversation on this critical issue

The most vulnerable members of our society, children, were not spared, with 542 cases of rights violations recorded. Domestic violence, which is becoming increasingly rampant, accounted for 471 cases.

Non-state and private actors were also responsible for 32 and 36 violations, respectively, while three cases of rights violations were recorded against people with disabilities.

The NHRC’s report is a wake-up call to all stakeholders, including the government, civil society organizations, and individuals, to take immediate action to address these violations.

The fact that social, economic, and cultural rights accounted for 157 violations, and referred cases stood at 24, highlights the need for a comprehensive approach to addressing human rights issues in Nigeria.

It exposed 499 killings and kidnappings, 71 violations of the right to life, and 301 school children abducted in Kaduna State alone.

The commission’s Senior Human Rights Adviser, Hilary Ogbonna, revealed these shocking statistics, which include 40 people killed in Benue State and four deaths in Nasarawa State during palliative distribution.

The report highlights a broader pattern of human rights violations, including domestic violence, abductions, and children’s rights abuses. It’s alarming that the right to life is being violated in various ways, and human rights violations are escalating.

This is despite Nigeria’s adoption of the Universal Declaration of Human Rights and over two decades of democratic governance.

The Global Peace Index Report’s ranking of Nigeria as one of the least peaceful countries in the world (144th out of 163) is a damning indictment.

The report emphasises the gravity of human rights abuses in Nigeria, where basic rights like freedom from oppression, participation in decision-making, and access to fundamental needs like food, work, medical care, and education are frequently denied.

However, the Universal Declaration of Human Rights, adopted in 1948, enshrines fundamental rights like freedom from oppression, participation, and access to basic needs.

While many countries, including Nigeria, have incorporated these rights into their constitutions, the reality on the ground is starkly different.

In Nigeria and Africa, people face physical and mental torture, police brutality, domestic violence, kidnappings, and detention without trial.

Since its declaration, it has become fashionable for most countries of the world, Nigeria inclusive, to entrench the catalogue of rights in their constitutions.

But, regrettably, in Nigeria, and indeed Africa, people are usually subjected to physical and mental torture ranging from cases of accidental discharge and other forms of police brutality, domestic violence, kidnappings as well as detention without trial.

Also, insecurity, in its various forms, has become a pervasive issue in Nigeria, manifesting as banditry, kidnapping, terrorism, and communal conflicts. This has resulted in the loss of lives and property, highlighting the government and security forces’ failure to fulfill their social contract with citizens. The lack of remedies for victims, including compensation and access to justice, has further worsened the situation.

The Nigerian Constitution guarantees the right to personal liberty, a fundamental feature of any democratic setting.

However, persistent obstacles, including legislative constraints, societal prejudices, and systemic shortcomings, hinder the full realization of human rights. It is crucial to acknowledge these challenges and work collectively to dismantle them.

The myriad of challenges facing Nigerians includes insecurity, separatist agitations, torture, illegal detention, extortion, and extra-judicial killings by law enforcement agencies.

Limited access to justice, abuse of court process, and disregard for court orders, as well as the increased cost of living and deteriorating living conditions, further hamper citizens’ ability to lead safe and meaningful lives.

Human rights protection plays a critical role in fostering vibrant democracies, promoting social cohesion and diversity, and cultivating a conducive and peaceful living environment.

To address these challenges, we recommend strengthening the independence of the judiciary, press freedom, democratic rules and principles, human rights education, and public vigilance. This will help curtail human rights abuses and promote good governance in Nigeria.

We urge the government, civil society organisations, and individuals to work together to address these pressing issues and ensure that the rights of all Nigerians are respected, protected, and fulfilled.

We also call on civil society organisations and individuals to continue to advocate for human rights and hold those in power accountable for their actions.

We also urge the government to take immediate action to address these violations, investigate and prosecute perpetrators, and implement policies to prevent future abuses. We also call on civil society organisations and individuals to continue advocating for human rights and holding those in power accountable.

The time for change is now. We must work together to ensure that the rights of all Nigerians are respected, protected, and fulfilled.

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Editorial

Endless turnaround maintenance of Port Harcourt Refinery

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Since 2021 when the turnaround maintenance of the Port Harcourt Refinery started, there have been heaps of failed promises of the production commencement date.

First, it was former Minister of State for Petroleum, Timipre Sylva promising severally of commencement of productions of Port Harcourt Refinery, but these promises never came to limelight till he resigned for political calling.

Next was the Managing Director of Port Harcourt Refinery, Ahmed Dikko who at a time said the turnaround maintenance was 98 percent completed and would have commenced operations in December 2023. That promise again was unfulfilled.

The Group Managing Director of Nigerian National Petroleum Company Limited (NNPC Ltd), Mele Kyari equally said that Port Harcourt Refinery would start production in two weeks time, that elapsed in April, 2024. April has come and gone.

The Head, Corporate Communications of NNPC Ltd, Olufemi Soneye was also quoted to have said that the reason for non-commencement of operations of the Port Harcourt Refinery was regulatory and compliance tests. As it seems, all efforts to restart the operations of the Port Harcourt Refinery and by extension other refineries, have been futile.

Political watchers have adduced poor management, corruption, sabotage and lack of political will as some of the problems confronting smooth operations of our refineries. They particularly accused those benefitting from importation of petroleum products as being responsible for the non-functionality of the four refineries in Nigeria.

Political will, of course, plays a major role in shaping directions the policies go. Political will in this instance translates to good leadership, and in this case, the buck stops at the table of the Federal Government, particularly the President, who doubles as the Minister of Petroleum.

Petroleum being the mainstay of the country’s economy should be given all the attention it deserves. The reason being that virtually everything in the country is tied to the petroleum products situation.

Since the announcement of the removal of fuel subsidy on May 29th, 2023 by President Tinubu on assumption of office, life has not been the same in Nigeria. Cost of living has  risen astronomically, consequent upon the hike in price of petroleum products.

In the midst of plenty, courtesy of the abundant human and material resources, Nigeria is still often described as the poverty capital of the world. What an irony! Turnaround maintenance of the refineries subsists without end. Every hope is now placed on the Dangote Refinery, a private outfit. While the diesel price slash is commendable, how on earth will a single private entity take the whole country to Eldorado?

We cannot regulate what we do not produce, this is a natural principle that cannot be contravened. We only pray that Port Harcourt Refinery comes on stream someday.

We look forward to that time. Our position is that Government agencies saddled with the responsibility of providing fuel and other petroleum products to Nigeria must do their work and justify their pay.

This onerous task is mandatory and statutory to them and shall amount to disservice if they fail. Our prayer is not for them to fail, but that they fulfil their vows and make the country great for the overall interest of all.

Tecnimont, the Italian company undertaking the $1.5 billion rehabilitation project of the Port Harcourt Refinery has through its Local Managing Director, Gian Fabio Del Cioppo pledged to fulfil the terms of contract, so as far as we are concerned, there is nothing stopping the country from achieving the target of the turnaround maintenance project.

The only clog would of course be lack of political will, which we know could be cultivated. So let all hands be put on deck to achieve results.

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Editorial

Gas explosions: Nigeria and its avoidable tragedies 

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Nigerians die daily for reasons  so avoidable it would make  a 19th century peasant weep.  The deaths are often a product of systemic wickedness, nonchalance, and greed. Too often have gas explosions claimed the lives of Nigerians untimely. Whether it is the leaders refusing to enforce the checks and balances for personal gain, or citizens selling defective gas cylinders, it all balls down to a collective aversion for kindness.

The internet is rife with news of this tragedy occurring in a Sisyphean cycle. Jolted by the cries of the populace, the leaders promise reprieve, release press statements and in the weeks that follow, little to nothing happens. “One must imagine Sisyphus happy,” Camus wrote. Unfortunately, our Nigerian dead imagine nothing.

While people relaxed from their labour, were preparing for the Workers Day celebrations, nine people including a pregnant woman were injured in Tuesday’s gas cylinder explosion at Alaba Lane, Alayabiagba Community of Ajegunle-Apapa, Lagos.

“The fire explosion started around 1:30 pm and immediately, two tricycles were burnt, school children coming back from school were affected. A particular young man was seriously affected as his body was peeling off, but rushed to the Gbagada General Hospital,” according to reports.

The usual suspect is, of course, negligence, as the Director of Lagos State Fire and Rescue Service, Margaret Adeseye, puts it: “preliminary investigation revealed that several various gas cylinders traded within the neighbourhood have one triggered from a susceptible leakage leading to the snapping of a high tension cable and resultant Fire.”

The explosion razed down “four commercial tricycles, six lock-up shops, a bungalow part of properties, while salvaging adjoining structures including a major fuel service station.” Children were hurt, the future of the nation plunged, as usual into avoidable misfortune.

The way out is through. The press releases are wonderful PR statements but they do not bring back the dead, as was the case in Ogun State recently where a truck explosion cost the nation another life. The leaders must enforce the checks and balances put in place. The law is no decoration.

We mustn’t wait until a politician’s family member is involved in a tragic gas accident before “banning” (as is the default response of the Nigerian leadership). The leaders must realise that such misfortunes are contagious, and money is hardly a bulwark against 3rd degree burns in a nation where all its doctors are fleeing.

Renewed Hope requires renewed action. This is all that Nigerians ask of its leaders. All agencies responsible for monitoring trucks, cylinders need to work together to defeat this peculiar evil. Like COVID-19, gas explosions are no respecter of persons.

Of course, citizens too must do their part and resist the allure of profit over the death of others. A society without empathy is headed for a dystopia. It will not matter the price of petrol or electricity tariff, if all that matters is the pursuit of super profit at the expense of one’s neighbour. We owe it to the dead to live fully and graciously. To escape, as we should, avoidable tragedies.

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