N2.1 Trillion Was Lost To Militancy And Vandalism In 2016, Says NNPC

Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), Maikanti Baru
A total of $7 billion (N2.1 trillion) is said to have been
lost to the activities of militants and vandals in the Niger Delta region of
Nigeria in 2016.

This revelation was made known by The Group Managing
Director of NNPC, Maikanti Baru, on Friday, October 28, 2016.
At the 2016 Fiscal Liquidity Assessment Committee Retreat in
Abuja, Baru said the Nigerian National Petroleum Corporation and Nigerian
Government lost the sum to the activities of militancy groups and oil pipeline
Baru also said that apart from security challenges in the
region, politics, judiciary, oil prices and production cost continued to impact
negatively on the oil industry.
In his words: “Over 7000kpd of crude oil has been lost due
to vandalism this year. A bulk of the loss is from JV assets. 
This implies that
60 per cent of oil production lost is NNPC-FGN equity.
“At an estimated price of $45 per barrel, the total 2016
revenue loss to the Federation Account translates to about $7 billion. This is
money that the government could have used to achieve major infrastructural
“ This loss is equivalent to a new 7,000mw power plant; new
350kpd refinery; over 30 per cent of National budget; and a new 1,700 kilometre
pipeline,’’ he said.
Proffering solution, Baru said the NNPC planned to increase
security of oil and gas assets, improve its community social responsibility and
the Amnesty programme.

He also said the NNPC planned to renegotiate terms of
Production Sharing Contract with deep offshore operating companies because with
the current agreement, only 17.7 per cent of total revenue comes to government.


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