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Shell loses $260.57m to crude theft, pipeline vandalism

Royal Dutch Shell has bemoaned the surge in pipeline vandalism and crude theft at its facilities in Nigeria, noting that it lost 4.015 million barrels of crude oil amounting to $260.5735 million to this menace in 2018.

The General Manager, External Relations of the Shell Petroleum Development Company (SPDC), Mr. Igo Weli, who said this at a workshop in Lagos, yesterday, maintained that such efforts to curb pipeline sabotage will save lives, secure communities and protect the environment.

Speaking on Pipelines Right of Way Encroachment and Vandalism, Weli said: “Since 2017, sabotage spill rate has risen steeply and crude oil theft from SPDC JV’s pipeline network averaged 11,000 barrels per day in 2018, an increase of about 20 per cent over previous year.

“The number of sabotage-related spills increased in 2018 to 111, compared to 62 in 2017 and, since 2012, SPDC has removed more than 1,160 illegal theft points,” he said.

For the 365 days in the year, the company’s cumulative loss through 11,000 bpd hit 4.015 million barrels. And with $64.9 per barrel average price for crude in 2018, the 4.015 million amounted to $260.5735 million.

Also speaking at the workshop, Shell’s General Manager, Safety and Environment, Chidube Nnene-Anochie, said irrespective of the cause, SPDC cleans and remediates areas impacted by spills from its facilities.

According to Nnene-Anochie, “SPDC implements work programmes to appraise condition of, maintain and replace key sections of pipelines and flow lines. In 2018, for example, we installed 70 kilometres of pipelines and 188 kilometres of flow lines. Over the last seven years, SPDC has replaced approximately 1,300 kilometres distance of flow lines and pipelines.


“In line with industry regulations, SPDC only pays compensation if the spill is operational.”
Towards the UNEP Report-guided Ogoni Clean Up, Weli said: “SPDC actively supports the clean-up process along with other stakeholders. SPDC remains fully committed to providing its share of $900 million (N283.73 billion) over five years to the Ogoni Trust Fund as stipulated in the Hydrocarbon Pollution Remediation Project (HYPREP) gazette and the agreed governance framework.



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