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Tuesday, April 23, 2024

Nigeria adopts virtual crude oil evacuation amid rising pipeline vandalism

Government shifts strategy to barge and truck transport to combat rampant theft and losses in oil sector

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In a bid to stem the tide of rampant crude oil theft and pipeline vandalism plaguing Nigeria’s energy sector, the Federal Government has embraced a virtual means of crude oil evacuation, eschewing traditional pipelines in favor of barge and truck transportation systems.

The Alternative Crude Oil Evacuation Systems (ACOES) initiative, outlined in a recent presentation by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), represents a paradigm shift aimed at mitigating production deferment and revenue losses associated with pipeline disruptions.

Citing staggering annual losses amounting to trillions of naira due to oil theft and vandalism, government authorities have intensified efforts to combat the illicit activities that undermine the nation’s economic stability. The Senate’s directive for a comprehensive investigation into crude oil theft underscores the severity of the issue, prompting urgent action to safeguard vital infrastructure.

“The commission has therefore promoted the implementation of Alternative Crude Oil Evacuation Systems to avoid production deferment and losses and other undesirable consequences as a result of pipeline disruption and outages,” stated the NUPRC in its presentation.

The ACOES initiative leverages barges and trucks for the transportation of crude oil from production sites to injection/storage points, circumventing the vulnerabilities inherent in traditional pipeline networks. By adopting a flexible and cost-effective approach, the government aims to mitigate risks for new entrants into the industry and ensure continuity of production during Extended Well Test and early production phases.

Chief Ukadike Chinedu, National Public Relations Officer of the Independent Petroleum Marketers Association of Nigeria, lauded the government’s proactive measures to combat oil theft, emphasizing the critical importance of preserving Nigeria’s revenue streams from crude oil sales.

“Nigeria earns a bulk of its foreign exchange from the sale of crude oil, so it is important for the government to continue to come up with ways to tackle the menace of oil theft and we encourage them in this,” Chinedu remarked.

As Nigeria navigates the complexities of its energy landscape, the shift towards virtual crude oil evacuation marks a pivotal step in fortifying the nation’s economic resilience and safeguarding its vital natural resources against illicit exploitation.

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