THE U.S.A. & SHELL OIL CALL FOR TOUGHER SANCTIONS ON NIGERIA OIL THIEVES & NIGERIAN SHIPPING PORTS

THE U.S.A. & SHELL OIL CALL FOR TOUGHER SANCTIONS ON NIGERIA OIL THIEVES & NIGERIAN SHIPPING PORTS

Lagos (Platts)--31July 2013

Shell said Wednesday that the Nigerian government needs to ensure oil thieves are prosecuted and sanctioned in order to tackle the growing problem effectively.

"I believe the perpetrators of these crimes need to be arrested and prosecuted, to serve as a deterrent," the chairman of Shell companies in Nigeria, Mutiu Sunmonu, said in an address delivered at an industry conference in Lagos.

Sunmonu said oil theft, if not checked, posed a major challenge to Nigeria's bid to increase its oil production to 4 million b/d and reserves to 40 billion barrels by 2020.

"At a point this year, over 60,000 barrels of crude oil were stolen from SPDC [Shell] lines every day," he said.

Nigeria's special military unit, the Joint Task Force, in the first half of the year impounded 24 vessels involved in loading crude oil stolen in Niger Delta creeks, with 608 suspects arrested during raids by government forces, a military spokesman said Wednesday.

JTF spokesman Onyema Nwachukwu said in a statement that troops seized 133 barges involved in oil theft and destroyed a total of 748 illegal refineries in the Niger Delta in the first half of this year.

"We've taken into custody about 608 suspects who are involved in oil theft and oil theft-related cases," Nwachukwu said.

While a government amnesty for Niger Delta militants in October 2009 helped to curb violence in Nigeria's main oil-producing region, crude oil theft and pipeline sabotage has become a growing problem for the country's economy.

Armed gangs are tapping crude from pipelines either for local refining or to move it onto barges for sale to tankers waiting off the coast.

Nigeria's oil industry auditors said Monday that Africa's top producer lost a total of 146 million barrels of crude oil to theft and pipeline vandalism between 2009 and 2011, amounting to $11.79 billion, or 7.7% of the country's total revenue.

Nigeria has sought help from the international community, including the UK, to check oil theft.

--Staff, newsdesk@platts.com --Edited by Jonathan Fox, jonathan.fox@platts.com