Stolen Crude Used to Import Arms, Says Shell Managing Director

This Day (Lagos)
NEWS
December 9, 2003
Posted to the web December 9, 2003

By Mike Oduniyi
Lagos
Lush funds from stolen Nigerian crude oil, are being used to finance
importation of arms to prosecute the raging ethnic violence in the Niger Delta,
the Managing Director of Shell Petroleum Development Company, Mr. Chris
Finlayson, has said.
Finlayson said contrary to the widely held belief that the ethnic clashes as
well as attacks on oil workers and facilities was the result of
marginalisation, it is the activities of international organised crime
syndicates that were fuelling the crises.
"Gangs had tapped into pipelines to siphon oil into illicit tankers under cover
of darkness, selling it on world markets," said the Shell boss.
"Some of the multi-million dollar revenues had been used to smuggle arms into
the Niger Delta, where rival ethnic groups are fighting over land and
resources.
"This is not disaffected local youths out to do a bit of harvesting, these are
significant criminal syndicates ... and the revenue is recycled into arms in
the Delta which fan the conflict," he added.
Industry estimates put current oil losses due to illegal bunkering at 200,000
barrels per day (bpd) where Shell alone loses as much as 100,000 bpd.
Arrests made by the Nigeria Navy seemed not to have deterred the bunkerers,
which according to officials was due to the lucrative nature of the business.
As the crude theft bites harder, Shell recently called for the certification of
Nigeria's crude oil going into the international market, to track down the
thieves and end the huge economic losses brought by activities of illegal
bunkerers.
Certification of the country's crude oil through what is called "finger
printing," according to the company, will enable the Federal Government block
the market for stolen crude, thereby serving as disincentive to the syndicates.
Finger-printing of crude refers to a process where through analytical chemistry
techniques, the characteristics and composition of a particular crude oil grade
will be unambiguously identified.
Finlayson said collaboration between the company and the government had helped
reduce the volume of crude oil stolen from Shell facilities to around 20,000
bpd in the last few weeks.
Clashes between rival ethnic groups in the oil-producing Niger Delta since the
beginning of this year, have left hundreds dead and several properties
destroyed.
Only last weekend, attack on two Ijaw communities in Warri-North Local Council
in Delta State, left about 19 people dead and scores of others wounded when
some Itsekiri youths burnt houses and shot sporadically around the area.
Militant youths armed with sophisticated weapons, have also hijacked oil
production facilities and abducted oil workers at random.
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN)
and the Nigerian Union of Petroleum and Natural Gas Workers (NUPENG) at a joint
meeting last weekend, gave the government up till December 31, 2003, to among
other things, produce decisive steps to secure the lives of their members
operating in the Niger Delta or face industrial action.

   

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