The Federal Government has announced that the Nigerian National Petroleum Company Limited (NNPC) lacks the necessary funds to replace its outdated pipelines.
Minister of State for Petroleum Resources, Heineken Lokpobiri, revealed this at the Energy and Labour Summit 2024 in Abuja. He highlighted that Nigeria’s pipelines, some dating back to the 1960s and 1970s, are severely corroded and beyond their operational lifespan. Despite the country’s ability to produce over 1.7 million barrels of crude oil, the challenge remains in transporting it due to the dilapidated pipeline infrastructure.
Lokpobiri emphasized that the ease of pipeline vandalism is partly due to their poor condition and outdated technology. He suggested adopting more advanced and costly pipeline technologies from other countries is necessary.
Given the financial constraints of NNPC, Lokpobiri advocated for public-private partnerships (PPPs) to address the pipeline issues. He noted that restoring investor confidence, lacking for over a decade is crucial for attracting private-sector involvement.
The minister also addressed the issue of fuel smuggling, attributing it to the low domestic pricing of imported fuel. He pointed out that the involvement of local security agents in smuggling operations complicates the enforcement efforts.
On the supply of crude to local refineries, Lokpobiri expressed concerns about potential setbacks if production does not increase. He underscored the need to support local refining by ensuring a steady supply of crude, emphasizing the government’s commitment to fair competition among refiners and supporting local refining initiatives.
