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Shell has claimed that theft of oil in Nigeria, especially along the Niger Delta, has reached such a high level that they may have to completely shut down their Nembe Creek oil pipeline, potentially costing the company 150,000 barrels of oil per day.
The Nembe pipeline is one of the largest and most important routes for Nigeria’s oil exports and closing it down could seriously affect the African nation’s economy.
Organised gangs of oil thieves tap into exposed pipelines in the creeks and gulleys of the Niger Delta, they then load the filched crude onto oil barges, transport them to larger ships offshore, and finally sell the product on the international market; the crude can also be refined locally.
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Between 22nd of February and 25th of February, the flow stations along the pipeline were shut down three times due to thefts.
Mutiu Sunmonu, Shell Nigeria’s managing director, said that, “it is getting to the crunch that rather than allow people to continue to attack my pipeline and devastate the environment, I may actually consider shutting the pipeline completely.
The situation in the last few weeks is unprecedented. The volume being stolen is the highest in the last three years; over 60,000 bpd from Shell alone.”
Whilst Shell would lose far more oil production by closing the pipeline, the added damage to the environment, fishing communities, and water sources, makes the decision a no brainer.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com