Nigeria to legalize oil bunkering to check theft

January 09, 2014 | Government & Regulations

Nigeria’s JTF confronting  illegal crude oil bunkering in Yenagoa, Niger Delta Nigeria 26 May 2013

Nigeria’s JTF confronting illegal crude oil bunkering in Yenagoa, Niger Delta Nigeria 26 May 2013

Lagos –  Nigeria has announced plans to legalize supply of oil products to vessels anchored offshore the country’s waters, in a bid to check large scale theft of its crude and petroleum products as well as shore up its oil revenue, the country’s oil industry regulator, the Department of Petroleum Resources (DPR), said Wednesday.

The DPR Executive Director, George Osahon said the agency would roll out the guidelines for the regulation of the activity, referred to in local parlance as oil bunkering, “in accordance with the provision of the Petroleum Act 1969.”

“Nigerian President Goodluck Jonathan has approved the issuance of licenses to bunkerers as part of his economic agenda,” a DPR statement quoted Osahon saying.

“This will will help create employment activities for Nigerians as well as act as a stimulus for growth in other sectors of the economy, including inland ports and waterways,” he added.

The DPR said prospective operators would be required to submit an application to the Nigerian Navy detailing the vessel to be used, the location of the bunkering operation or discharge point, the quantity of fuel and the duration of the operation, in order to secure the bunkering permit.

The Nigerian government banned bunkering in the 1980s following large-scale abuse of permits, but the business has since festered illegally, with thieves tapping into pipelines to steal crude and oil products, costing Nigeria about $6 billion in potential oil revenue.

Nigeria’s special military unit in the Niger Delta, the Joint Task Force, said last month it had seized a total of 46 vessels of various sizes involved in illegal oil bunkering in 2013, while 81 barges, 1,117 cotonou boats, 82 tanker trucks and 1,873 surface tanks were destroyed.