Despite withdrawal of subsidies, fuel smuggling continues at borders – Custom bosss

Adewale Adeniyi, Acting Comptroller-General of the Nigeria Customs Service, promised a tough crackdown on oil thieves on Monday, saying the country cannot “afford to let saboteurs take over our economy.”

Adeniyi, who stated that despite the withdrawal of the subsidy on Premium Motor Spirit, also known as fuel, at Nigeria’s border stations, the agency had developed new border patrol techniques to track down oil thieves.

He made the revelation on the sidelines of a session in Abuja for NCS management staff on the Nigeria Customs Service Act 2023.

Adeniyi spoke as the Nigeria National Petroleum Company Limited announced Monday that it had apprehended a suspected Cameroon-bound vessel carrying crude oil.

Garba Muhammad, the NNPCL’s Chief Corporate Communications Officer, stated in a statement that the cargo was intercepted on July 7, 2023, by Messrs Tantita Security Services, a private security contractor hired by the NNPCL.

“On July 7, 2023, a private security contractor contracted by NNPC Ltd., Messrs Tantita Security Services, seized a suspicious vessel with a cargo of crude oil on board,” the statement said in part.

It went on to say that the vessel, which was registered in Nigeria, was on its way to Cameroon when it was captured.

“The Vessel, MT TURA II (IMO number: 6620462), owned by a Nigerian Registered Company, Holab Maritime Services Limited with registration number RC813311, was heading to Cameroon with the cargo on board when it was apprehended at an offshore location (Latitude: 5.8197194477543235°, Longitude: 4.789002723991871°), with the Captain and Crew members on board,” the statement said.

President Bola Tinubu proclaimed the end of petrol subsidies at his inaugural address on May 29, 2023, after the Federal Government had been subsidizing the product for decades, spending trillions of naira in the process.

The government had often complained that petrol from Nigeria was being smuggled into other West African countries because of its low price in Nigeria due to subsidies, when compared to its cost in these countries.

To address this and other gasoline subsidy-related concerns, many institutions and professionals urged for a suspension of the subsidy regime, which Tinubu eventually adopted.

However, the Customs General Directorate announced on Monday that smuggling had decreased but had not halted in some border stations.

As a result, he stated that the agency was examining its enforcement techniques, and that under the new Nigeria Customs Service Act 2023, violators would face harsh penalties.

When asked if petrol was still being smuggled out of Nigeria after the subsidy was removed, he said, “We still have some incidents in some border points.”

“The rate has dropped, and we will be keeping a careful eye on the situation.” The petroleum situation is extremely delicate, and we cannot afford to let saboteurs take over our economy.”

Review of the Enforcement Strategy

In response to the service’s plans to evaluate policies that are impediments to trade, Adeniyi stated that this had to do with the NCS’s enforcement methods, as well as its protocols and operations at the ports.

“One of the things I aim to do as we begin is to review our procedures and processes in the ports and border areas.” In addition, our enforcement techniques. We’ll go through everything again.

“And we want to do it in a way that promotes user-friendliness and economic growth while without jeopardizing our national security.” “We will get details when we reveal the plans,” Adeniyi said.

He stated that the service’s new legislation would impose harsh punishments and penalties on offenders of customs laws.

“We discovered that earlier legislation did not provide sufficiently punitive punishments for infractions of customs laws.” Some of the fines were absurd. Remember that this (ancient) piece of legislation went into effect in 1958.

“You won’t believe it, but some fines in the legislation were written on pennies, and when translated, they mean nothing.” As a result, thieves are constantly prepared to commit fraud since they know they will only get a slap on the wrist.

“So what this new law has introduced is very significant punitive fines that should prevent anyone from violating customs law,” the NCS chairman explained.

He stated that the defunct Customs and Excise Management Act Cap C45 LFN 2004 statute was enacted 63 years ago and had remained in effect ever since, despite government expansion, population increase, and dynamic economic advances and obstacles.

“As a result of this, several previous attempts to reform or remove CEMA were futile.” The efforts were required since the provisions of CEMA had grown outmoded and could no longer adequately meet the government’s current fiscal policies and the service’s mandate.

“This probably prompted the National Assembly to commence the repeal and passage of a new Nigeria Customs Service Bill, which was passed by the parliament and assented to by (former) President Muhammadu Buhari,” Adeniyi noted.

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Meanwhile, NNPCL stated that early investigations revealed that the crude oil cargo on board was obtained illegally from a well jacket off the coast of Ondo State, Nigeria.

According to Muhammad, a NNPCL spokesman, there was no valid documentation for the vessel or the crude oil cargo on board at the time of the arrest.

“Additional research into the vessel’s actions at the NNPC Ltd. Command and Control Centre found that the vessel has been operating in stealth mode for the last 12 years.” Tin Can Port was the vessel’s last reported location in July 2011.

“Details of this arrest and the findings of the investigations were escalated to the proper government authorities, and it was decided to demolish the vessel as a strong warning and deterrent to all those involved in such unlawful acts to quit and desist,” he said.

Muhammad emphasized the need of destroying vessels involved in the transit of stolen crude oil, claiming that the unlawful sale of stolen crude oil causes huge economic losses to Nigeria and legitimate stakeholders in the oil business.

Oil theft, he noted, “also maintains a cycle of corruption, environmental damage, and societal instability.”

In addition, Captain Warredi Enisuoh, Executive Director, Technical and Operations of Tantita Security Services, stated to journalists on Monday during an inspection of the intercepted vessel, which was anchored at Oporoza in Gbaramatu kingdom in Warri South West Local Government Area of Delta State, that the ship was arrested with 13 crew members during a sting operation.

Enisuoh revealed that the pipeline surveillance firm used both human and technical intelligence to track the vessel’s movements until it was apprehended on Friday.

“Unbeknownst to the culprits, we had been tracking the vessel’s movements until we ultimately seized it off the coast of Ondo State,” he stated.

“The vessel’s original name was Ali-Riza-Bey, but it was changed to ‘MT Tura 11’ to avoid the eagle eyes of security agents,” he added.

While adding that the vessel had previously been caught for the same crude robbery but had vanished under unknown circumstances, Enisuoh assured reporters that “we are here with the same vessel committing the same atrocity.”

As a result, the vessel was turned over to troops from the military Joint Task Force Operation Delta Safe, which is tasked with ridding the Niger Delta of any criminal activity.

Rear Admiral Olusegun Ferreira, Commander, JTF Operation Delta Safe (OPDS), who led other service commanders to the scene, told reporters that an inquiry is underway to identify the culprits of the act, while also warning criminals to avoid the maritime domain.

Ferreira told Nigerians that the long arms of the law would catch up with the hoodlums.

Marketers respond

In response to the NCS’s disclosure that petrol was still being smuggled, oil marketers and downstream operators indicated that this was conceivable but extremely risky due to the liberalization of the downstream oil sector.

They also charged the NCS with apprehending offenders and deploying tracking systems on petroleum tankers in an effort to stop the smuggling of PMS and other refined products.

“There is a significant risk in smuggling petrol out of Nigeria presently, however I cannot rule out the possibility,” said Chinedu Okonkwo, National President of the Independent Petroleum Marketers Association of Nigeria.

“The risk is significant because you might go there and they won’t buy from you,” he warned, unless the smugglers are bringing tainted goods to these neighboring countries. Customs should also complete their duties. If they catch somebody, they should hold him up as a model.”

Tankers, according to Okonkwo, should have tracking equipment installed to trace their movements around the country.

“At one point, we provided them (Customs) a device that allows you to follow any truck by knowing where it is coming from or going.” But just as we were preparing to launch it, COVID-19 struck.

“There are technology to combat these threats, and if they want to work with us, we will bring it up again.” “IPMAN is ready to demonstrate it again if they are willing to collaborate with us,” he said.

Billy Gillis-Harry, President of the Petroleum Products Retail Outlets Owners Association of Nigeria, told our correspondent that PETROAN has devised a system to aid with this.

“A criminal will always be a criminal,” he remarked. Most of the time, there is nothing you can do to deter a criminal until you reduce their illicit actions. That is why PETROAN devised a 3-P solution, the Petroleum Product Passport, to entirely eliminate smuggling.

“This is because nobody will be able to smuggle things when this solution is installed, because at the end of the day, we must rely on dependable and reliable technology.” The 3-P approach works for PETROAN, thus we propose it to the Federal Government and other downstream companies.”

“The customs serviceman the boundaries of Nigeria and they should do their work,” said Mohammed Shuaibu, Secretary, IPMAN, Abuja-Suleja. Let them go after the smugglers, because deregulation is here to stay, in our opinion.

Meanwhile, several oil marketers predicted that cross-border smuggling of petrol would continue unless Nigerian fuel prices matched those of neighboring countries.

Tunji Oyebanji, former Chairman of the Major Oil Marketers Association of Nigeria and CEO/MD of 11 Plc, stated that the price of petrol in neighboring nations will decide the genuine pricing.

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“The Federal Government must eliminate the economic incentives that are causing marketers to take products intended for Nigeria outside the nation, which will occur when independent marketers begin importing and pump prices reflect the new landing cost.” But, as we speak, we are still selling things sold to us by the NNPCL, which is still receiving subsidies, thus Nigeria is losing, not marketers. According to rumors, roughly 30% of products are smuggled out of the nation, so that’s where the problem is right now,” he explained.

Tella Sheriffdeen, an economics lecturer at Olabisi Onabanjo University, encouraged the government to engage local refining.