Nigeria losing billions to oil theft, wastage – Experts

Industry experts, on Monday, warned that Nigeria is losing billions of dollars daily to crude oil theft, vandalism and wastage, calling for urgent digitalisation of production and monitoring systems to safeguard the economy.

In a joint paper presented at a leadership forum in Houston, U.S., Charles Deigh, a petroleum engineer at the Nigerian Agip Oil Company and Dr Oluwatoyin Gbadeyan, a mechanical engineer and researcher on composite, bio-composite, nano-composite, tribology, and valorising wastes, said the country’s current system of oil validation was “outdated and opaque,” creating loopholes for theft and inefficiency.

They argued that every barrel of oil should represent national prosperity, but losses from sabotage and poor accountability were undermining government revenue and development.

“This is not just unfortunate — it is unacceptable. Nigeria cannot afford to let another barrel go to waste. We need bold, transformative action,” they stated.

The experts commended steps by the Nigerian Upstream Petroleum Regulatory Commission, including the Nigeria Upstream Measurement System, the Automated Hydrocarbon Accounting System, and the metering provisions of the Petroleum Industry Act 2021.

However, they cautioned that without full enforcement, the initiatives risk becoming “empty gestures rather than game-changers.”

PUNCH Online reports that oil theft, spillage, and wastage have always been a concern in Nigeria, in terms of economics and health.

According to the United Nations, at least 13 million barrels—or 1.5 million tonnes—of crude oil have been spilt since 1958 in at least 7,000 incidents.

While many reports have blamed oil corporations for oil incidents, the federal government revealed that crude oil theft across Africa is driven by specialised international and continental gangs exploiting security lapses.

Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Bashir Ojulari, said in August at Africa Chief of Defence Staff Conference in Abuja that oil theft is not a localised crime but a sophisticated operation requiring cross-border collaboration to tackle effectively.

As solution, the experts recommended immediate deployment of digital technologies such as Internet of Things (IoT) sensors, drones, satellites, blockchain tracking and artificial intelligence across oil infrastructure to curb leakages.

According to them, such measures would help reduce the estimated 200,000 barrels lost daily, restore investor confidence, promote transparency among stakeholders and free resources to fund schools, hospitals and infrastructure.

The experts stressed that technology alone would not solve the problem unless backed by strong government action, strict enforcement of the PIA and consequences for non-compliance.

They urged oil companies to invest in lasting monitoring systems and called on host communities to embrace transparency as a pathway to shared prosperity.

“Nigeria stands at the crossroads of opportunity and decline. Oil theft and inefficiency are not inevitable — they are the consequences of inaction and neglect,” they said.

They warned that failure to act decisively would keep the country trapped in revenue losses, while urgent digitalisation could drive growth, stability and diversification.