Nigeria seeks to curb oil theft with $21m metering contract

In a move aimed at tackling the persistent issue of oil theft in the Niger Delta, the Nigerian Federal Government (FG) has awarded a $21 million contract for the metering of 187 crude oil flow stations.
This initiative, approved by the Federal Executive Council (FEC), represents a significant step towards increasing transparency and accountability within the nation’s oil and gas sector.
The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, who disclosed this at a press briefing in Abuja, stated that the initiatives would further give clarity on the volumes of crude produced in-country as well as the amount exported to other nations.
He said, “Two days ago, the Federal Executive Council meeting was held, presided over by Mr President, where we took some very bold steps to reorganise the oil and gas sector. One of the key approvals by the Federal Executive Council has to do with awarding a contract for the metering of our 187 flow stations across the Niger Delta region of Nigeria by the Nigerian Upstream Petroleum Regulatory Commission.
“NUPRC is the apex regulatory agency or commission for the Nigerian oil and gas upstream sector. As part of our steps to ensure that we have proper accountability, the Federal Executive Council approved the metering of all our production. We have 187 flow stations in the country, and there was a contract awarded for us to meter all the flow stations so that we’ll be able to properly account for what we produce and what we export.
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“It is a major development that has never happened in this country. And this project is meant to be completed within six months, within 180 days. And it is important that Nigerians know some of the key steps that this government is taking to ensure that we maximise opportunities that other countries are getting by the availability of oil and gas in Nigeria.”
Curbing Losses and Boosting Revenue
Oil theft has long been a drain on Nigeria’s economy, with estimates suggesting billions of dollars lost annually. The installation of meters at flow stations – the points where crude oil is extracted from the ground – aims to provide accurate measurements of oil production. This data will be crucial in identifying discrepancies and preventing theft throughout the oil production process.
Efficiency Concerns and Transparency
However, questions remain regarding the effectiveness and long-term implications of this project. Some analysts point out the relatively low cost of the contract, raising concerns about the quality and durability of the meters to be installed. Additionally, the 180-day timeframe for project completion seems ambitious, and potential delays could hinder the initiative’s impact.
Furthermore, the success of this project hinges on robust enforcement mechanisms. The government must demonstrate a strong commitment to holding all parties accountable, including oil companies and any individuals involved in tampering with the meters.
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