NNPC Finds Underwater Oil-Theft Pipeline Running Out Into the Sea

gas flaring
Routine gas flaring in the Niger Delta (file image)

Published Oct 7, 2022 8:33 PM by The Maritime Executive

The top official at Nigerian state oil company NNPC claims that his team has discovered a four-kilometer-long illegal pipeline leading from Shell's Forcados export terminal out into the sea. Shell Petroleum Development Company (SPDC), the operator of the Forcados terminal, confirmed Thursday that an illegal seaward pipeline does exist in the region - but says that it is located far away and has no connection with SPDC operations. 

“SPDC appreciates the additional surveillance conducted on behalf of NNPC to deal with illegal activities," a company spokesperson told the Premium Times. *However, the recently discovered theft pipeline is approximately 30 kilometers away from SPDC’s Forcados terminal. It is not within SPDC’s pipeline Right of Way.”

The pipeline is a rare and extreme version of the rampant oil theft that plagues Nigeria, known locally as "oil bunkering" (distinct from marine bunkering). Kyari estimated the rate of oil theft at about 600,000 barrels per day, worth about $55 million daily at current pricing. This is a much higher rate than historical independent estimates of Nigerian oil theft, which have been in the range of 150,000 bpd in years past. Official corruption is widely blamed for the trade's decades-long persistence.

The problem of crude oil theft has been worsening, officials say, and it is beginning to affect Nigeria's finances. Official crude exports are down to roughly 1.0 million barrels a day, thanks in large part to "calamitous" theft rates and pipeline vandalism, Kyari said. Recorded exports came to about 1.6 million bpd as recently as the end of 2021, and it 2010 they were averaging about 2.5 million bpd. 

In addition to the illegal pipeline, Kyari said that in his team's recent crackdown some "395 illegal refineries have been deactivated, 274 reservoirs destroyed, 1,561 metal tanks destroyed [and] 49 trucks seized."

To aid in the crackdown, NNPC has hired a security company run by the well-known former militant Tompolo, whose Movement for the Emancipation of the Niger Delta (MEND) terrorized oil installations in the early 2000s. Tompolo is still wanted on corruption charges dating back to 2016.