As they have done everyday for the past 50 years, oil tankers steamed away from Nigeria's coast yesterday loaded with hundreds of thousands of barrels of crude, from which Nigeria gets most of its income.

But the Nigerian government cannot say exactly how much oil is being lifted from the country, mostly by Shell, Mobil, Chevron, Total, Agip and a few others.

Instead, the government of Umaru Yar'Adua, like all others before it, relies almost entirely on whatever the oil companies tell them.

The situation is such that, if Mobil, for example, declares that it lifted 50,000 barrels of oil yesterday, the government just has to take their word for it.

Worse still, Nigeria's political leaders and top bureaucrats for decades have not shown the slightest interest in finding out. In a notoriously corrupt industry, which has spawn scandals such as the on-going Halliburton case, roping in the top echelon of the political class, it is very convenient to keep everything vague.

Add to this the increased crude oil theft or illegal bunkering in the Delta region described by President Umaru Yar'Adua in July 2008 as fuelling a trade in 'blood oil', which is run by powerful cartels and the figures officially quoted become increasingly weightless.

more on the report

http://www.234next.com/csp/cms/sites/Next/Money/Business/5408495-146/Black_Hole:_Nobody_knows_how_much.csp

Nigeria : Free for all market. Nigeria is one of few places on this earth where you can a commit any crime and get away with it. That sounds more like a failed state. It is estimated that Nigeria loses at least 500000 barrels per day.

i think i knew that from day one

It's not surprising in the least.

This will always be the case when you have an inefficient National Oil Company (NNPC) that is an 'oil producing company', custodian of government interests, final decider on budgets, non-transparent and a pseudo-regulator all at the same time.

Till the DPR is strengthened to play it's regulatory role (it was formerly part of the NNPC) and stop being the poorer cousin of the NNPC, we will not be able to reconcile the figures and know our actual production.

The estimates of 500,000 barrels per day are likely wide of the mark - that would be more than a quarter of production.

Part of the problem is data/information management. Too many bodies and individuals making pronouncements on the oil industry, instead of focused information coming from (or originating from) one reliable and consistent source.

Nah I refuse to believe that. How come the OPEC know how much oil barrels we produce a day? Or is it all just estimates looking at our capability?

ElRazur:

Nah I refuse to believe that. How come the OPEC know how much oil barrels we produce a day? Or is it all just estimates looking at our capability?

OPEC doesn't 'know' for sure - they set an export quota, which is then complied with by individual countries. Nigeria will send figures to OPEC stating so and so is our production, either based on tankers loaded and reported in shipping registers or metering done either at export terminals or elsewhere in Nigeria.

This quota is usually set as a percentage of your production ability. It is a well known fact that compliance with OPEC quotas is never 100% - this lack of clarity might be deliberate in this regard, making it difficult to tell if we are over-producing relative to the quota from OPEC.

Nah I refuse to believe that. How come the OPEC know how much oil barrels we produce a day? Or is it all just estimates looking at our capability?

are u a retard?

OPEC doesn't 'know' for sure - they set an export quota, which is then complied with by individual countries. Nigeria will send figures to OPEC stating so and so is our production, either based on tankers loaded and reported in shipping registers or metering done either at export terminals or elsewhere in Nigeria.

This quota is usually set as a percentage of your production ability. It is a well known fact that compliance with OPEC quotas is never 100% - this lack of clarity might be deliberate in this regard

There was no need to explain, he will never understand, he doesn't have the required number of brain cells to,

@Poster, I have always suspected .

how do u expect them to do all that. thats too much work abeg. by the way all you "Diasporic"_{i cant believe somebody thot that was a word} nigerians should leave nigeria alone.

idupaul:

are u a retard?

Hello to you too.

idupaul:

There was no need to explain, he will never understand, he doesn't have the required number of brain cells to,

You do realise, I am giving the benefit of doubt here? It may have been poorly executed I must admit. However, Coming in high and mighty when you are missing the obvious is pretty much lame and ironic.

must_a_far:

how do u expect them to do all that. thats too much work abeg. by the way all you "Diasporic" nigerians should leave nigeria alone.

Where were you, men? I_Tombola actually posted something meaningful on this thread https://www.nairaland.com/nigeria/topic-266094.32.html . I cried tears of joy when I read it.
It warmed my heart to know that there was still hope for the . . .

No be that thread wey people just dey shift goal post anyhow them like be that. i breezed in and out of the thread yesterday. make i go read.

What a joke,not even household management can be so lax and here we are talking of our national cake being toyed with like akara.

redsun:

What a joke,not even household management can be so lax and here we are talking of our national cake being toyed with like akara.

Akara ke ? Akara is far more better , it is properly looked after better than nigerian crude oil.

Does anybody need more evidence that the Nigerian government is utterly useless? I don't.

Until good governance is appreciated in Nigeria, the giant of Africa will remain asleep.

Na waaoooo wonders shall never end, so u mean say those ANUMANU we full there no even no there responsibities SHAME to all of them, I beg makesome one try and waken them from their slumber otherwise nemeses wil catch up with all of them and their families GOD BLESS NIGERIA[i][/i]

Someone is not doing his job

I think it's absolutely preposterous for anyone to make the assertions in the article. I'm not one for long write-ups but I can confidently tell you that crude loading is one of the most scrutinized activities in Nigeria. Oil companies don't just sell oil at any place, there are loading jetties where you have DPR representatives strictly monitoring what is being loaded into tankers. The only oil that is unaccounted for is that stolen by the Niger Delta militants/bunkerers and their collaborators

I only wish we come to the understanding that the media is not 100% right at all times.

Even a cursory check by NEXT has revealed that various agencies of our government give conflicting figures of how much oil we produce and sell.

The Central Bank, the Ministry of Finance, the Department of Petroleum Resources, the Nigerian National Petroleum Corporation (NNPC) cannot agree on exactly what the numbers are.

So they have come up with an ingenious solution: they simply 'average' the various figures and let sleeping dogs lie.

Among Nigeria's most significant oil ministers over the past several decades are the former president, Olusegun Obasanjo, who for several years served as his own oil minister.

And the current oil minister, Rilwanu Lukman, has been in and out of the same job so many times that he has become nearly synonymous with the portfolio.

If either of these two gentlemen, or any of their predecessors, ever was troubled by this shabby state of affairs, which almost certainly guarantees large scale theft of our resources, it is unknown to an unsuspecting public.

A brick wall

For several days, we tried to reach the minister of state for petroleum, Odein Ajumogobia, but each time he promised to get back to us but never did.

The Nigerian National Petroleum Corporation, our state oil company which enters into joint ventures with the oil multinationals, even goes so far as to say on its website that it cannot be held responsible for the accuracy of the sales figures it publishes.

The Central Bank, which receives the money on behalf of the Nigerian people, also would say nothing regarding the veracity of these numbers.

The Department of Petroleum Resources (DPR), the industry regulator, makes the astonishing claim that it does not know the figures.

After more than two weeks of constant calls, text messages and email, the department's acting director, Billy Agha, informed us through a spokesman that "we only corroborate what NNPC gives to us."

Oil revenues account for more than 90 percent of our foreign exchange earnings and more than 80 percent of total revenue.

How much of it we get directly affects our ability to pave our roads, care for our infirm, secure our neighbourhoods and educate our children.

The politics of numbers

The mystery surrounding a simple issue of accounting for oil revenue has proved impervious to changes in administrations, political parties, elected governments or military dictatorships.

Last month, the news agency Reuters quoted Mr. Lukman as putting our daily oil production at about 2 million barrels per day. But Mansur Muhtar, the minister of finance, has quoted an average of 1.6 million barrels per day, which according to him, is "significantly lower than government projections."

Last week, Mr. Ajumogobia put the production figure at 2.1 million. Even if Nigerian citizens are to be deceived, government officials should at least agree on a particular figure, and all of these announced figures are at variance with data supplied to the Organisation of the Petroleum Exporting Countries, the cartel that caps how much oil each of its members is expected to produce.

Nigeria has come a long way from producing about 500 barrels per day following the discovery at Oloibiri in 1958, but the oil majors that have been instrumental since that time, were understandably reluctant to talk to us last week. The current method of accounting seemingly works as well for them as it does for the public officials in charge who have maintained it.

NNPC's Disclaimer

Even the figures quoted in the NNPC's latest Annual Statistical Bulletin (2007) posted on its website, had a caveat; "The publications in this section present information on the oil and gas industry. Its content reflects individual as well as general analysis and trend of activities that characterised the industry within the country.

"Although NNPC endeavours to ensure accuracy of information in these documents, it cannot guarantee 100 percent accuracy nor can it be held liable for errors that may occur. Users are to note that use of any information herein is purely at their discretion."

In their defence, some in the industry say they have technical challenges that make it difficult to collate accurate figures. "Production figures are voluminous. If someone is sitting down and doing the stuff manually, the person will be confused," said a key industry executive.

"They should have a spreadsheet such that as the figures come in they are being recorded automatically. For them to come up with a compilation that is accurate, they need to have adequate data management, which they do not have, as is the case in all government establishments."

As a result, while some base their estimates on the volumes arriving at terminals and off-take points, others are based on volumes from oil wells and flow stations. These were responsible for the disparity in the NEITI's Audit of 1999-2004.

Oil workers don't know

Even oil industry workers don't have a clue. Peter Esele, former president of the Petroleum and Natural Gas Senior Staff Association, says, "Whatever information that is gotten from the NNPC is from the producers.

"One thing is clear, DPR does not even have the capacity to undergo or even know the quantity of crude. They don't have a meter, they don't have a measuring meter. Now, if you go to NNPC, the figure is different, DPR's is different, producers' different, CBN is different. So you cannot really reconcile all this." Esele for a time had served in NEITI.

Peter Akpatason, president National Union of Petroleum and Natural Gas Workers, said: "Officially we don't know. But we have access to the information each time we want to get them.

"But, it is not as if on daily basis, we get the figures. I'm sure you know that there is always discrepancy of some sort between what NNPC declares and what DPR declares.

"What somebody explained to us in DPR is that NNPC figure is taken at the point of production while DPR take theirs at the terminal."

For Mr. Akpatason, the reason for these discrepancies is because, "The case of oil production is like any other developmental issue in Nigeria. The government has always shown ineptitude in handling very serious economic issues in this country.

And for us, we believe that this is a mark of poor leadership. Because, there is no reason why a country cannot say specifically that this is the quantity of goods and services that are produced and this is the naira value of such goods and services."

The One:

I think it's absolutely preposterous for anyone to make the assertions in the article. I'm not one for long write-ups but I can confidently tell you that crude loading is one of the most scrutinized activities in Nigeria. Oil companies don't just sell oil at any place, there are loading jetties where you have DPR representatives strictly monitoring what is being loaded into tankers. The only oil that is unaccounted for is that stolen by the Niger Delta militants/bunkerers and their collaborators

I only wish we come to the understanding that the media is not 100% right at all times.

It is one of the few reasons I stated that I refuse to believe we are **that** bad.

The One:

I think it's absolutely preposterous for anyone to make the assertions in the article. I'm not one for long write-ups but I can confidently tell you that crude loading is one of the most scrutinized activities in Nigeria. Oil companies don't just sell oil at any place, there are loading jetties where you have DPR representatives strictly monitoring what is being loaded into tankers. The only oil that is unaccounted for is that stolen by the Niger Delta militants/bunkerers and their collaborators

I only wish we come to the understanding that the media is not 100% right at all times.

Obviously you have failed to read report  . nobody here is speculating .  I have highlighted some parts for you have a scan through.

@Blacksta But surely we can't be that BAD.

The One:

I think it's absolutely preposterous for anyone to make the assertions in the article. I'm not one for long write-ups but I can confidently tell you that crude loading is one of the most scrutinized activities in Nigeria. Oil companies don't just sell oil at any place, there are loading jetties where you have DPR representatives strictly monitoring what is being loaded into tankers. The only oil that is unaccounted for is that stolen by the Niger Delta militants/bunkerers and their collaborators

I only wish we come to the understanding that the media is not 100% right at all times.

How are they 'scrutinising' and measuring? The article claims DPR reps say they don't have flow meters!

Meaning they take whatever figures the oil companies say they are exporting - is this right or wrong?

Of course we know there are loading jetties - Forcados, Brass, Bonny, Escravos and QIT. Who does the measurements? Who ensures the meters are calibrated properly? Is it the same DPR that can't stop petrol stations from underselling litres of petrol?

I remember a professor at school in Nigeria telling me a story about how he worked for one of the international oil companies in the early 70's. His job was to install a flow meter on a pipeline to measure crude export, but curiously enough, the design involved an unmetered line bypassing the flow meter. Who knows how much crude was sent through the bypass without Nigerian authorities knowing? Your guess is as good as mine.

The clear discrepancies between figures reported by various arms of the same government show that we are not confident of how much oil we are exporting or how much is being produced or stolen.

@ poster

dont even go there. nigeria is a failed nation, so these and more are d sort of things found in a failed state.
u havent seen anything yet.

emmydee:

@ poster

dont even go there. nigeria is a failed nation, so these and more are d sort of things found in a failed state.
u have seen anything yet.

Are you by any chance praying for more bad things to happen?

It is not a matter whether he is praying for it to happen.More will happen.

asha 80:

It is not a matter whether he is praying for it to happen.More will happen.

no doubt we all know bad things will happen if the underlying factors are not corrected but do we have pray for it to come quickly

it is well.

All this is T-I-A.(This is Africa).Leaders get what ever they can and move on to oversea countries to settle.

is just crude oil thats not being accounted for. just show me one thing that is properly managed and accounted for in this our country. just one. pray that this oil dries up soon so that corruption and all kinds of mismanagement dries up with it. nigeria was far better when there was no crude oil. rest my case. have a nice day.

toxicguy:

is just crude oil thats not being accounted for. just show me one thing that is properly managed and accounted for in this our country. just one. pray that this oil dries up soon so that corruption and all kinds of mismanagement dries up with it. nigeria was far better when there was no crude oil. rest my case. have a nice day.

You must be joking. Wait 40 YEARS for oil to dry up? Who says mismanagement did not start before oil and will not continue after oil is exhausted?

This is why I hope the oil industry reform by Lukman goes ahead - regulatory bodies in this vital industry must be strengthened.

@poster! go national assemble go ask that question. you fit get answer dia as a concern citizen

@The One,

You were correct. NNPC, DPR,Customs & Reps of the oil companies are represented during loading and the metering skid s are calibrated more like a monthly basis. That report can not be entirely correct.