Nigerian businessman and philanthropist Tony Elumelu has highlighted oil theft as a major reason why International Oil Companies (IOCs) are divesting their interests from Nigeria.
In an interview with the Financial Times, published on Friday, Elumelu expressed his concerns about the ongoing crude oil theft in the country, which he believes is forcing IOCs to seek opportunities in other countries.
Elumelu emphasized that the Nigerian government and its security agencies should be able to identify and expose those responsible for the massive theft of the country’s crude oil. He pointed out that oil theft is not a minor issue, comparing it to stealing a bottle of Coke, which can easily be hidden.
“This is oil theft; we’re not talking about stealing a bottle of Coke you can put in your pocket. The government should know; they should tell us,” Elumelu said.
Reflecting on his own experience, Elumelu revealed that about 18% of the crude oil produced from his fields, amounting to 42,000 barrels per day, is still being stolen.
He expressed frustration with the government’s inability to address this issue, stating, “Our security agencies should tell us who is stealing our oil. You bring vessels to our territorial waters, and we don’t know?”
Elumelu also recounted how the previous administration of President Muhammadu Buhari allegedly blocked him from acquiring an oilfield. He claimed that Heirs Holdings, his investment firm, had been attempting to purchase the oilfield since 2017 and had raised $2.5 billion for the acquisition, but the deal was ultimately thwarted by Buhari and his late Chief of Staff, Abba Kyari.
The ongoing issue of oil theft in Nigeria is not only affecting local businesses but also leading to a significant divestment by international oil companies.
Gbenga Komolafe, Chief Executive of the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), recently disclosed that several IOCs, including Shell Petroleum Development Company, Nigeria Agip Oil Company, Mobil Producing Nigeria Unlimited, and Equinor, are set to divest their investments in 26 oil blocks in Nigeria.
These divestments involve substantial hydrocarbon reserves, including an estimated total reserve of 8.211 million barrels of oil, 2,699 million barrels of condensate, and 44,110 billion cubic feet of associated gas.
Komolafe noted that the divestments could significantly boost Nigeria’s national production if managed by competent successors.
Elumelu’s comments and the ongoing divestment by IOCs underscore the severe impact that oil theft is having on Nigeria’s oil industry and the urgent need for the government to take decisive action to address the issue.