The revelation followed a forensic audit conducted by the commission covering the period from January 2020 to November 2022.
Approximately 40 per cent of the volumes of crude oil losses in the Nigerian petroleum industry are due to measurement inaccuracies and not theft, the Nigerian Upstream Regulatory Commission (NUPRC) has said.
The Chief Executive of the NUPRC, Gbenga Komolafe, made this known in a statement on Sunday.
Mr Komolafe said the revelation followed a forensic audit on crude theft numbers, conducted by the commission covering the period from January 2020 to November 2022.
According to the statement, he disclosed this in Lagos at the Petroleum Club Quarterly Dinner.
In recent years, Nigeria has recorded an increase in the rate of oil theft in its oil-rich Niger Delta region.
In April 2022, the Group Managing Director of the NNPC Limited, Mele Kyari, disclosed that Nigeria lost $4 billion to oil theft at the rate of 200,000 barrels per day in 2021. Last September, the NNPC said that the country loses 470,000 barrels of crude oil monthly amounting to $700 million to oil theft.
The federal government in its draft fiscal strategy paper for 2023 through 2025 said that oil revenue underperformed due to significant production shortfalls such as shut-ins resulting from pipeline vandalism and crude oil theft.
On Sunday, Mr Komolafe said the forensic audit was to ascertain with accuracy the stolen volume of crude oil within the reference period.
Metering
He noted that the commission is committed to dealing with the issue of metering errors by ensuring that Original Equipment Manufacturers (OEMs) licensed directly as agents of the commission will be responsible for the deployment and maintenance of metering facilities across Nigeria's oil and gas facilities, for transparency in hydrocarbon accounting.
"The reform measure adopted by the Commission offers a paradigm shift from the trajectory in Nigeria's hydrocarbon measurement since oil was discovered in Nigeria in Oloibiri in 1956 and is aimed at ensuring that no one becomes a judge in his own case.
"Admittedly, one major area of value erosion in the industry is the menace of crude oil theft. Our records indicate that the menace of oil theft has negatively impacted the oil and gas sector for about two decades with attendant huge financial losses to our nation," Mr Komolafe said.
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He explained that the commission, in collaboration with the various arms of the security forces, the NNPC Limited and the host communities, has been able to suppress the ugly trend of hydrocarbon value decimation.
"Now, our nation can now record good dividends of these collaborative efforts as production figures are progressively increasing.
"The January 2023 volume is approximately 1.5 million barrels per day of oil and condensates. It is expected that this number will continue to increase as further measures are introduced and sustained to remove all illegal connections that aid crude oil theft," he added.
Currently, he said Nigeria is flaring about 10 per cent of the gas produced, a challenge the commission is also determined to eliminate through the ongoing Gas Flare Commercialization Programme (GFCP).
"Nigeria produces about 8BSCF/D of gas, out of which approximately 20 per cent is delivered to the domestic market, approximately 40 per cent is exported to international markets, 30 per cent is utilised for producer's internal consumption and the excess gas is flared.
"In alignment with our objectives, as outlined in Section 6 of the Petroleum Industry Act, the Commission is diligently pursuing the basic regulatory goals which include: increasing Nigeria's oil and gas reserves and production, developing a transparent approach to hydrocarbon accounting, and attaining operational efficiency and effectiveness in industry operations.
"In addition, the Commission is committed to facilitating peace and harmony in the host communities to guarantee a conducive operating environment for investors, positively impacting on operating cost and attracting more investment opportunities," he said.
