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Nigerian Military Destroys 8 Illegal Refining Sites In Niger Delta

The Nigerian Army has destroyed eight ovens used for refining stolen crude oil in Warri South Local Government Area of Delta, director, Army Public Relations, Brig.-Gen. Onyema Nwachukwu has said. The troops have also destroyed 14 reservoirs containing ~200,000 liters of stolen crude oil and ~90,000 liters of diesel.

Earlier this month, Nigerian military forces destroyed 36 illegal refining sites and arrested 22 suspected oil thieves in the Niger Delta, with a Defense Headquarters spokesperson telling local media that the operation recovered 310,700 liters of crude oil; 14,675 liters of Automotive Gas Oil, 49,000 liters of Dual Purpose kerosene and assorted weapons. This illustrates just how rampant oil theft and illegal oil business has become in Africa’s largest producer.

Last year, Nigerian National Petroleum Company Limited (NNPCGROUP) CEO Melee Kyari revealed that Nigeria was losing nearly all the oil output at oil hub Bonny, the town after which its premium oil grade Bonny Light is named. 

Bonny Light is a light-sweet crude oil grade produced in Nigeria, and an important benchmark crude for all West African crude production. Bonny Light has particularly good gasoline yields, which has made it a popular crude for U.S. refiners, particularly on the U.S. East Coast. Although the figures are usually estimates, the NNPCL and the ministry of petroleum have variously put the total quantity of barrels stolen at between 200,000 to 400,000 per day. 

Nigeria managed to produce 1.184 million bpd in May, making it Africa’s largest producer ahead of Libya (1.158 million bpd), Angola (1.111 million bpd) and Algeria ( 962,000 bpd).

However, oil theft is by no means confined to the West African nation. Oil smuggling has become a particular problem in many developing nations, as armed groups siphon oil for resale. For instance, oil smuggling costs Libya an estimated $750 million per year, good for 3% of its GDP. Last year, Mustafa Sanalla, the head of the country’s National Oil Corporation, called on the European Union naval mission to help stop oil smuggling by seizing their ships in the Mediterranean, and urged Libya to reform massive subsidies that allow fuel to be sold for as little as 2-3 U.S. cents per liter.

By Charles Kennedy for Oilprice.com

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