The Federal Government has announced that the Nigerian National Petroleum Company Limited (NNPC) lacks the financial resources to rebuild the country’s aging and deteriorating pipelines.
This was disclosed by the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, during the 2024 Energy and Labour Summit organized by the Petroleum and Natural Gas Senior Staff Association of Nigeria in Abuja.
Lokpobiri emphasized the critical need to repair these old pipelines, some of which date back to the 1960s and 1970s, as they have become corroded and expired.
These deteriorated pipelines pose a significant challenge in evacuating the country’s crude oil, even if production levels exceed 1.7 million barrels per day.
The minister noted that the outdated pipelines are easily vandalized due to their poor condition, making oil theft more prevalent.
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Given NNPC’s financial constraints, Lokpobiri called for a public-private partnership (PPP) approach to address the issue.
He pointed out that rebuilding investor confidence is crucial, as there had been a lack of foreign investment in Nigeria’s oil sector over the past 12 years.
However, the current government has been working to restore this confidence, which is now attracting investors.
Lokpobiri also addressed the ongoing issue of fuel smuggling from Nigeria to neighboring countries, attributing it to the NNPC’s practice of importing and selling fuel below the landing cost.
He expressed concerns about the ability to supply crude oil to local refineries, including Dangote’s, unless production is significantly increased.
Despite these challenges, the minister reaffirmed the government’s commitment to supporting local refining and ensuring a fair competitive environment for both small and large refiners in Nigeria.
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