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Nigeria: Shell Links Crude Oil Theft to International Syndicate

By Ejiofor Alike: 5 July 2011

Shell Petroleum development Company of Nigeria (SPDC) has linked the rampant cases of crude oil theft in the Niger Delta to international criminal network, and called on all stakeholders to take urgent steps to check the dangerous trend.

According to SPDC, sabotage and crude oil theft was the cause of 22,310 barrels spilled from its facilities in 112 incidents in 2010, representing an average of about one spill every three days.

However, 5,270 barrels was due to 32 operational problems, arising from equipment failures recorded during the period.

Chairman of Shell Companies in Nigeria and Managing Director of SPDC, Mr. Mutiu Sunmonu, said in a remark at an oil and gas event in Lagos at the weekend that the company’s operation in the Niger Delta is increasingly facing various acts of sabotage.

“We do have crude oil theft – those interested in stealing crude from our Niger Delta operation and they have a great network – international network for crude theft; and that needs to be checked. We also have sabotage, where people deliberately damage our facilities to generate contract out of the damage and that also needs to be checked. We do have people, who steal pipelines – they harvest pipes and that needs to be checked. There are also people, who cause spills because they want to make claims as a result of spills that affect them; which they caused,” he said.

The Shell boss, who was represented by a top official of the company, Mr. Mason Oghenejobo, however stated that despite the challenges, the company will continue to promote the growth of indigenous oil producers by releasing more assets.

The oil giant has maintained that sabotage accounted for over 75 percent of oil spill incidents and more than 70 percent of oil spilled from its facilities between 2006 and 2010.

Shell said it paid more than $1.7 million in compensation in 2010, only to those affected by operational spills, while security agents arrested 187 people and seized 20 tankers, 15 vehicles, 28 barges and 38 other boats involved in this illicit business during the period.

It paid more than $4 million in compensation, as well as provided clean water and food to affected communities in 2009.

According to the company, most of the oil in 2009 was spilled in two incidents in Odidi field in Delta State and the Trans Escravos Pipeline.

“At the Odidi field in Delta State, thieves trying to steal the oil from a wellhead caused a blowout that spilled an estimated 78,000 barrels before a specialist well control company was able to bring it under control after 98 days. The thieves had vandalised safety valves that would normally allow the emergency response team to shut off the flow of oil very quickly. The specialist contractors had to create and maintain a safe zone to work while contending with changing conditions such as wind direction, tidal movements and security concerns from militants. Initial quick action by SPDC Limited the spill to the immediate surroundings of the well and almost all of the oil was recovered. A further estimated 18,500 barrels was spilled in the second major incident on the Trans Escravos Pipeline, which was attacked by saboteurs who set off five explosive devices along the line,” Shell said.


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