Civil Society Legislative Advocacy Centre (CISLAC) and Fair Finance Nigeria have called on the Federal Government to urgently address the menace of crude oil theft and ensure that revenues from the petroleum sector are transparently and effectively utilized for national development.
Speaking at the official launch of a report titled ‘Community Voices on Oil, Finance, and the Petroleum Industry Act (PIA): A Case Study of Akwa Ibom and Bayelsa States’ in Abuja, CISLAC Executive Director, Comrade Auwal Ibrahim Musa Rafsanjani, lamented the colossal loss of 619.7 million barrels of crude oil valued at $46.16 billion between 2009 and 2020.
According to Rafsanjani, crude oil and natural gas remain the backbone of Nigeria’s economy, accounting for 89.23 percent of the country’s exports in the third quarter of 2023.
He noted that between 2020 and 2023, the Nigerian National Petroleum Company Limited (NNPCL) alone received over $10.3 billion in syndicated loans from local and international financiers, yet oil-producing communities remain impoverished.
The CISLAC boss identified complicity among oil companies, security agencies, government officials, and some community leaders as a major driver of persistent oil theft, which he described as a ‘lucrative criminal business.’
According to him, ‘If we are still treating oil theft in the lackadaisical attitude that it is being treated, definitely you will not see an end to the oil theft,’ he said. ‘At the end of the day, it is the generality of the communities that suffer.’
He added that host communities, despite their proximity to oil facilities, continue to live with exclusion, poverty, and environmental devastation. From January to August 2024 alone, five major oil spills were recorded in Akwa Ibom and Bayelsa States, with companies often opting to pay fines for gas flaring rather than invest in gas-gathering infrastructure.
The report highlighted lapses in the implementation of the Petroleum Industry Act (PIA) 2021, particularly in the Host Communities Development Trusts (HCDTs). Although oil companies are expected to contribute between $500 million and $800 million annually, only $21.7 million was remitted between 2022 and 2023, undermining sustainable projects and development initiatives.
‘Despite the enactment of the Petroleum Industry Act, challenges persist around inclusion, transparency, accountability, illicit financial flows, and the equitable implementation of the HCDTs,’ Rafsanjani stressed.
The study also documented severe socio-economic and environmental consequences, including respiratory diseases, cancer, and loss of livelihoods resulting from spills and gas flaring. Communities like Ibeno, Eastern Obolo, Ayakirama, and Azuzuama were cited as case study areas where residents continue to endure hardship without adequate compensation.
Rafsanjani described the report as ‘an urgent call to action for government, oil companies, financial institutions, and civil society to prioritize transparency, accountability, and collaboration to secure a just and sustainable future for oil-producing regions.’
In his presentation, Director of Programmes at Connected Development, Mr. Agu Kingsley, emphasized the role of financial institutions in preventing ‘greenwashing’ by ensuring strict adherence to Environmental, Social, and Governance (ESG) standards when financing oil and gas projects.
Kingsley disclosed that between 2020 and 2023, NNPCL received $8.6 billion in financing, enabling it to declare $1.7 billion profit in 2023. He added that over 50 percent of the 18 banks financing Nigeria’s oil sector claim to be signatories to global ESG principles, yet compliance remains weak.
According to him, ‘stronger regulatory frameworks and accountability measures are essential to strike a balance between project finance, environmental justice, and the development needs of host communities.’