The Senate Ad-hoc Committee investigating crude oil theft in the Niger Delta has uncovered about N300 billion in unaccounted crude oil proceeds.

The revelation, contained in the committee’s interim report to the Senate, detailed massive discrepancies, weak oversight mechanisms and systemic lapses that have enabled large-scale diversion of Nigeria’s crude oil revenue.

According to the report, a forensic review of domestic crude proceeds and tax oil proceeds records revealed crude oil sale differentials, mismatches and unaccounted funds amounting to about $22 billion. It further found a shortfall of $81 billion between receipts declared by the Nigerian National Petroleum Company Limited (NNPCL) and those recorded by the Central Bank of Nigeria (CBN) for 2016 and 2017.

The committee also said its review of crude oil sales from 2015 to date, supported by investigations from international consultants, projected that over $200 billion in crude oil sales proceeds remained unaccounted for globally.

The interim report, which followed months of document reviews, written submissions and public hearings, traced the problem to faulty measurement systems, weak regulatory oversight, and poor coordination among government agencies.

It Identified the use of unverified measuring instruments, lack of metrological control, ineffective interagency collaboration, and uncoordinated enforcement mechanisms as major enablers of crude oil theft.

The report faulted the suspension of the Weights and Measures Department’s activities in the upstream sector under the Petroleum Industry Act (PIA) 2021, saying the decision undermined accountability and accurate measurement in crude oil operations. It also noted that the absence of a special court to prosecute oil thieves and the non-implementation of the Host Communities Development Trust Fund (HCDTF) under the PIA had contributed to persistent sabotage and theft in oil-producing areas.

The committee projected that the unaccounted domestic crude sales proceeds amount to about N300 billion, calling for urgent local and international tracking, tracing and recovery of stolen crude oil funds for the benefit of the country.

It urged the Federal Government to mandate the Nigerian Upstream Regulatory Commission (NUPRC) to enforce international crude oil measurement standards at all production sites and export terminals or restore the Weights and Measures Department to its former regulatory role.

The committee also urged the government provide security agencies with modern surveillance technology and equipment, including unmanned aerial vehicles, to strengthen monitoring of oil facilities and detect theft and leakages in real time.

It called for the establishment of a Maritime Trust Fund to support the development and maintenance of maritime infrastructure, training and safety operations, as well as the creation of a special court to promptly prosecute crude oil thieves and their collaborators.

The committee further advised the immediate implementation of the Host Communities Development Trust Fund (HCDTF) to reduce community sabotage and promote inclusion in the management of oil resources.

In addition to the financial losses, the committee expressed concern over the growing number of abandoned and poorly decommissioned oil wells across the Niger Delta, which it said were leaking oil and gas into the environment and polluting communities.

It recommended that such wells be ceded to the NUPRC for handover to modular refineries to increase crude availability for local consumption and reduce vandalism. However, it noted a modest recovery in crude oil production, which increased by 9.5 per cent in 2023 from 490.95 million barrels in 2022 to 537.57 million barrels, indicating an improvement in production and security conditions.

The Ad-hoc Committee, which was reconstituted on Monday, February 11, 2025, following the death of its former chairman, Senator Ifeanyi Patrick Ubah, urged the Senate to grant it authority to track, trace and recover proceeds of stolen crude oil globally.

It said the recovery of these funds was crucial to rebuilding accountability in the oil sector, strengthening Nigeria’s fiscal position and deterring future theft.

But while commending the committee for a good job, the Senate stressed that it is not its job to recover stolen funds. It directed the committee to conclude its investigation and name the oil thieves, after which its recommendations will be sent to the executive for further action. (The Sun)