“Nigeria’s Criminal Crude” – A Report by Chatham House


The London-based think tank, the Royal Institute of International Affairs, otherwise known as Chatham House recently published a report titled “Nigeria’s Criminal Crude: International Options to Combat the Export of Oil”. The report analyses the international dimensions of Nigerian crude oil theft and explores what the international community could do about it.

A summary of some of the findings include:

  • “Nigerian crude oil is being stolen on an industrial scale. Nigeria lost at least 100,000 barrels of oil per day, around 5% of total output, in the first quarter of 2013 to theft from its onshore and swamp operations alone. Some of what is stolen is exported. Proceeds are laundered through world financial centres and used to buy assets in and outside Nigeria, polluting markets and financial institutions overseas, and creating reputational, political and legal hazards. It could also compromise parts of the legitimate oil business.
  • Officials outside Nigeria are aware that the problem exists, and occasionally show some interest at high policy levels. But Nigeria’s trade and diplomatic partners have taken no real action, and no stakeholder group inside the country has a record of sustained and serious engagement with the issue. The resulting lack of good intelligence means international actors cannot fully assess whether Nigerian oil theft harms their interests.
  • Nigeria’s dynamic, overcrowded political economy drives competition for looted resources. Poor governance has encouraged violent opportunism around oil and opened doors for organized crime. Because Nigeria is the world’s 13th largest oil producer – exports often topped two million barrels per day in 2012 – high rents are up for grabs.”

The report recommends the following four first steps for building a cross-border campaign against Nigerian oil theft:

  • “Nigeria and its prospective partners should prioritize the gathering, analysis and sharing of intelligence.
  • Nigeria should consider taking other steps to build the confidence of partners.
  • Other states should begin cleaning up parts of the trade they know are being conducted within their borders.
  • Nigeria should articulate its own multi-point, multi-partner strategy for addressing oil theft.”

The report rightly places a lot of responsibility on the shoulders of the Nigerian authorities to take the lead in combating this illegality and plunder. After all, the theft takes place within the country’s shores with the active connivance of Nigerian actors, before the oil is shipped off elsewhere.

The onus clearly lies on the Nigerian government to demonstrate political will in curbing the flow of stolen crude from the source. It has so far embarked on an effective campaign for the international community to regard stolen crude oil as “blood oil”, in the same manner as “blood diamonds” are treated. Yet the root source has to be plugged. At a Chatham House meeting a few months ago, I made the same point to (Mrs.) Erelu Olusola Obada, the Nigerian Defense minister when she requested in her presentation, for the international community’s assistance in rejecting stolen Nigerian crude oil (the Minister was relieved of her appointment along with 8 others in a cabinet reshuffle earlier this month). I pointed out that there has been no major prosecution within Nigeria, of those involved in this criminal enterprise and their alleged collaborators in the oil companies, the army and in other government institutions. The responsibility lies squarely on the country to block the source of stolen crude within its shores.

The authorities need to show resolve, go beyond rhetoric and put action to words. To start with, known criminals need to be put behind bars for a long time. Though the security agencies may be under-equipped and due for reform, they are not thoroughly incompetent. Once a few high profile arrests of the middle men, financiers and “godfathers” are made and convictions are secured, then the international community will be assured of Nigeria’s readiness to tackle oil theft and its criminal networks.

Truth is, the exhibition of firm political will by the government can singularly breathe life into the Chatham House and several other reports’ recommendations. After all, even the most meticulously crafted strategy is only effective when it is actually implemented.

Addendum:

In a televised Presidential Media Chat on Sunday 29th September, President Goodluck Jonathan had this to say about the phenomenon of oil theft:

“The stealing of crude oil didn’t just start now, it started since the military regime […] Oil theft is not done by petty thieves but by big people and exporters, to end it, we need the assistance of our foreign country friends and refiners to stop accepting stolen crude. In addition, we have committees on the issue who meet regularly”

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6 thoughts on ““Nigeria’s Criminal Crude” – A Report by Chatham House

    • Speaking a lot but saying very little is the way the animals speak in the Zoological Republic of Nigeria.

      On another note, oil bunkering has been occurring for about three decades; do you expect Jonathan to solve a 30 year old problem in 4 years?

      Even OBJ’s mass murdering of the residents of two villages did not stop the oil theft.

  1. Thanks Zainab for sharing this, I think its very naive of most people in the South of Nigeria when we think the North is just without intellectuals, and all the so called ” Mr and Mrs know it all ” are mainly from the west or south of Nigeria. However I think that’s a old perception of the North that’s way out outdated. I see a very active, social,economically and politically aware intellects all of Northern origin. I follow most of these group of Young and Youthful Northern’s who are objective and so committed to making the Nigerian project balanced and workable that it leaves me with nothing but shame when I see the likes of Asari Dokubo and other outright foolish folks projecting them self as the champions of the South- South. Am from that region and it’s just sickening! – I will urge the likes of you Ms or is it Mrs Zainab to do all you can to show that the North does have what it takes to merit any position held by a Northerner. That being said, I think its important to state here that the old guard of Northern so called elite are the ones who practically ruined the future of most Northern Nigerian’s born in the last 40yrs and even those yet unborn. You the young and upcoming educated and righteous ones must stand up to these Devils. Down south it’s almost a hopeless situation as the Youths there are now getting to a point where they are now even more dangerous to themselves, when compared to what damages the old greedy so called south – south leaders have done this region.

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