29 July 2012

Nigeria: Oil Theft, Terrorism - How to Contain the Two Monsters - General Olanrewaju


Major-General Tajudeen Adeniyi Olanrewaju (rtd) seldom speaks. The Lagos prince, who made his marks in the nation's defence sector as Commander, Corps of Artillery; General Officer Commanding (GOC), Three Division of the Nigerian Army, Jos; member, Provisional Ruling Council (PRC); was Chairman, Presidential Review Committee on the General Abisoye Panel report on the reforms of the NNPC and left the stage as Minister of Communications.

When confronted by Sunday Vanguard with questions bordering on his views regarding the current complications in the oil and gas sector of the nation's economy and national security challenges, he had no choice but to speak. Excerpts:

Oil theft has become a major problem in the petroleum sector and Shell Company has raised the alarm over the problem. As a man once in the saddle, what exactly do you think is responsible?

There is a structural defect within the oil sector and lack of authority. But as far back as 1991, I think the General Abisoye Panel said we were losing 150,000 barrels per day which was about one billion dollars. That was before this Shell outcry which now says we have lost at least 170 billion dollars so far.

And the problems as identified by Abisoye Panel: one is the issue of DPR, Department of Petroleum Resources. DPR used to be what you call the NNPC now. It was under the ministry but it was later on removed. The second problem is that we have not been able to turn the NNPC into a blue-chip company because of this structural defect.

Now in the NNPC, according to Abisoye Panel, it was agreed that there should be a department called Petroleum Inspectorate Agency (PIA), which is supposed to be in charge of technical and security control of the oil sector in order to avoid oil theft.

At that time, it was identified that in the upstream, it (oil theft) was caused by understatement of accounts and over invoicing; then statistics manipulation. That means the crude oil that we claim to have sold out, there is different between the oil they buy from us and where was the difference? It was in oil leakage, oil theft. That was as far back as 1991 as identified by General Abisoye Panel.

Now the downstream, which is the pipelines that they blow all around and the incapacitation of our oil refineries so that they don't work, which led to our importation of oil.

And when we start importing now, the same problem we are still having diversion of fuel, bunkering, understatement of accounts, over invoicing and the oil subsidy scam we currently have in our hands. That is the downstream problem and that is the reason the PIA was recommended by the Abisoye Panel to be established.

As far as I am concerned, there are many dimensions to the nation's security challenges but there are solutions if we want to. Oil theft that is being cried about is one of the major causes. We have to protect our oil and gas industry and sector.

We cannot be losing $170 billion on oil theft and at the same time spending $170 billion to import (refined) oil. How do you expect our economy to grow? Oil is the cash cow of the country at the moment and nothing can be too much for government to invest in protecting it against oil thieves, bunkerers or external aggression.

Take for instance the 2012 Olympics, the games are starting and Britain is devoting heavy security to protecting the people coming for the games because they know that any failure of the games will affect their prestige and economy.

I am saying that there is need for the use of combined forces of army, navy, air force in protecting the country's onshore and offshore and then I'm calling for the establishment of Petroleum Regulatory Authority (PRA) and Pipelines Protection Authority (PPA) to handle the regulation, technical and security control of the oil industry, and both should be placed under direct supervision of the National Security Adviser (NSA), Col. Sambo Dasuki. I know his antecedents and I can comfortably tell you that he has the liver to face the challenges headlong.

This has become necessary because, from the look of things, it is clear that solving the problem of security in the area is beyond concessioning. And we have to protect this country against 2015. The NSA should take note.

What form will the PRA and PPA take should they now be considered by the present administration being that it looks like hungry for solution to the many challenges in the oil sector that is the cash cow of the nation?

That PRA as advocated by me should be like a commission or an authority for them to be able to enforce like the EFCC so that they can arrest and prosecute. From that angle, the PRA and PPA are there, you know; statutory, technical and security control.

The technical control is just to block the over invoicing and understatement of accounts and statistic manipulations both in the downstream and the upstream. That means you need somebody from the Ministry of Trade for waste and balance so that we can know how much oil is going out; we need somebody from the Ministry of Finance and we need somebody from all these ministries; those are in charge of technical control. You know they do auditing from outside and that is the only thing that can block it.

More important to this discussion is the security of the oil sector and you have made mention of that here. How should the security control by the advocated authorities go?

I am suggesting that by the security control, there should be a National Task Force (NTF), just like it is in India and it is supposed to be a combination of the navy, the airforce, the army and of course the police. And it should be a special trained force just like America trained the Air Marshal following Al-Qaeda 9/11 bombing.

There was nothing like Air Marshal before then, that problem faced by the United States prompted the need for that professional forces and that means you have to develop human capital and you have to be specific. Not just to say navy, even the navy you are raising into the NTF has to be trained for that particular purpose and once that is done, they are supposed to be placed under direct supervision of the National Security Adviser.

It is not what the President is doing presently awarding the contract of that security to a foreign firm by concession.

Are you saying concessioning the maritime security like it has been done is not part of the way to solve the problem?

Concession, well, solving the problem is beyond concessioning the way it has been done. And this is because oil is the heartbeat of our nation's economy as of now and wherever oil is located, it is a military target when there is war. And most of them are on our territorial waters, which is one of the main objectives of the Army; to protect the territorial integrity of Nigeria and so, when you expose that to a foreign firm, it becomes very dangerous.

That is what we are saying. If you are exposing us to external aggression, you are exposing our economy to the foreign people ...Instead of that, we should protect our own territory by ourselves because, that is the heartbeat of the economy.

And when you look at the leakages in the oil and the money they have, the next thing they do is to control the political power of that country. That is what they are doing now. Whether they give you an oilrig .....whether you are doing understatement, these people are scattered all over Nigeria..... So wherever the ill-gotten money from the oil theft reaches, it is used to perpetuate political power. That is one of the problems we have in Nigeria.

If you talk about Libya itself, it is all about oil money in Libya, which made Gaddaffi stay. And because the money was so much, Gaddaffi was in Mali, he was in Somalia, he was in Uganda and he was giving them foreign loans; even up to the one in France which we all heard about. Oil money!

It's like having drug money in South America and Mexico and they come up to topple the government. That is why the country (Nigeria) is shaking and so there is need for us to block that aspect. And by the time you block that aspect (oil theft), I'm sure you are blocking terrorism directly or indirectly.

What you are saying in essence is that oil theft is responsible for the insecurity that we suffer presently as a nation. Is that right?

Yes! And you should block it because that is where the activities are. That is why if you ask INEC, they will tell you that it is the money politics that is happening in Nigeria.

You were so particular about NSA brazing up for the business of tackling the problem under discussion. What is it particularly that informs that position of yours?

Let me now talk more about why the NSA should brace up. You see, the collapse of Ghadaffi was why those fundamentalists migrated from Libya and Islamic State has been declared in Mali so that, from Libya, people are migrating with arms and ammunitions to cause Bok Haram.

That is the assumption. There are people that are trained with arms and ammunitions in Nigeria and so the NSA should look at it in those two ways. If that is the case, he has to be proactive. What you have as Boko Haram in the North is what you have as militancy in the South; the banditry, the robbery, the kidnapping and it is the same urban terrorism.

So these people can migrate to anywhere. The arms are coming from all the borders and people are making money from it just like the subsidy money. You have to look at that side and tackle it from the source.

Tackling the arms and ammunitions importation from the source means going into the countries of source and fight or what are you suggesting in the light of international laws?

America did four things: it first of all sensitised the people. Apart from the Al-Qaeda that came first, you have not heard of any bomb explosion and, if there is, it would be by a Nigerian. So America sensitised the people by propaganda and, after the propaganda, they updated their technology and developed human capital.

The moment they identified the source of what was threatening lives of their citizens and security in their country, George Bush left his country without regard for any international law and entered Afghanistan and Iraq. When you are doing this kind of thing, people don't look at international laws.

In Kenya now, they have entered Somalia because they know that is where these people are coming from, to bomb their country! What America is using is diplomacy. If you want to use the United Nations you use them; if you want to use NATO, you use NATO all in the name of fighting terrorism.

And in the case of Nigeria, and the NSA, Col. Sambo Dasuki, should take note, once you have been able to identify that the many security challenges Nigeria is facing as a nation and as a people is being fuelled by arms and ammunitions from certain countries outside Nigeria, you should go for those countries wherever they are!

If you want to use ECOWAS, use ECOWAS; if you want to use the AU, go ahead. But it must be spelt out here that in this kind of situation, you don't respect any international law. When you say you are respecting international law, diplomacy can take over. If you tell Mali that, "Look, these people that are bombing my country are in your country", you advance there. That is what America is doing and that is why America is safe right now.

So I don't see any reason that Nigeria will know that these so-called Boko Haram people are coming from Mali to bomb its country and it will not invade Mali. In actual fact, by pursuing and blocking them you are creating fear into them.

If you look at all the people doing this Boko Haram, they cannot be more than two thousand people and these are people holding about 150 million Nigerians into ransom!

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