A recent report sheds light on Nigeria’s staggering annual loss of $9.2 billion in its oil industry, primarily attributed to foreign shipping companies.
This revelation underscores one of several avenues through which Nigeria’s oil and gas sector hemorrhages revenue.
The Punch newspaper detailed how Nigeria forfeits $9.2 billion annually to foreign shipping firms that handle goods that could be managed by a national fleet.
Hassan Bello, former Chairman of the National Fleet Implementation Committee, emphasized the potential of the private sector to address this issue during the inauguration of the Shipowners Association of Nigeria in Lagos.
Bello stressed the significance of indigenous participation in international trade and urged concerted efforts to establish a national fleet, with the government’s support.
Echoing these sentiments, the former executive secretary of the Nigerian Shippers Council highlighted the urgency of diversifying Nigeria’s mono-economy, heavily reliant on crude oil exports.
He advocated for private sector-driven initiatives, backed by government incentives like tax holidays and policy reforms.
However, foreign exchange hemorrhage is not the sole challenge plaguing Nigeria’s oil sector. Recent reports revealed that the Nigerian National Petroleum Company Limited spent over N34.47 billion in 18 months to combat pipeline vandalism.
The Nigerian Extractive Industries Transparency Initiative’s Oil and Gas Report for 2021 disclosed that N22.05 billion was allocated to pipeline maintenance and repairs.
The NNPCL reported 350 incidents of pipeline vandalism in the first half of 2021, underscoring the persistent threat it poses to the sector.
Despite efforts to mitigate this risk, pipeline vandalism remains a significant hurdle in Nigeria’s quest for oil revenue sustainability.
