by Nick Kochan
Mrs Alison-Madueke, the daughter of a tribal chief, is seen as Africa’s oil tsar.
Well-resourced gangs are diverting some 10 per cent of Nigeria’s oil
production and channelling the money into kidnapping, piracy and
terrorism. The result is not only funds lost to the country’s exchequer
but also devastating damage to the environment and to the health of
people in the region. Some 200 foreign oil company employees, some from
Shell and BP, have been among those kidnapped for ransom in the Niger
delta over the last seven years.
A campaign to close down the “crime cabals” who divert crude oil to
the tune of 200,000 barrels a day is top priority for Diezani
Alison-Madueke, the Nigerian oil minister. She is leading a lobby to get
the world community on side on behalf of affected Gulf of Guinea
countries such as Benin, Cameroon, Equatorial Guinea, Gabon, Ghana,
Ivory Coast, Liberia and Togo as well as Nigeria. “We are very keen to
join hands as soon as possible with the international community in
fighting this terrible menace,” she said.
Britain and the US are assisting in developing a fingerprinting
system for tracking stolen crude. Mrs Alison-Madueke points out that the
global community enjoys wide access to Gulf of Guinea oil, with some
three-quarters of US oil imports from Africa coming from the region.
A clampdown on revenues from stolen oil is another part of her
campaign. Governments need to move against institutions that launder
what she calls the proceeds of “blood oil”.
“Oil theft is lucrative because thieves find it easy to sell their
consignments either to private buyers or on the international spot
market. Who are the buyers of the stolen crude oil, and through what
fiscal institutions is the money being laundered? It is not being sold
in the Ecowas [Economic Community of West African States] region,
neither are the financial institutions represented in Ecowas countries,”
Mrs Alison-Madueke says.
Shell has said that Nigeria loses over $1.6bn (£1bn) annually to oil theft.
Mrs Alison-Madueke, the daughter of a tribal chief, is seen as
Africa’s oil tsar. She was a regional head of Shell before becoming a
government minister. She is said to receive regular death threats from
oil importers who have lost their licences when found to have defrauded
the state’s oil subsidy system. Mrs Alison-Madueke supported the
Nigerian President Goodluck Jonathan’s plan to remove the subsidy that
the state pays oil companies to make petroleum products more affordable
at the pumps. Popular opposition forced Mr Jonathan to reverse this
policy. One commentator says: “She is a tough nut to crack.”
Stolen oil needs to be in the same category as blood diamonds, she
says. “Just as the world has taken a firm stance against trafficking in
blood diamonds, so must we confront trafficking in stolen crude. Many
innocent people are losing their lives as a consequence of oil theft.”
The environment of the Gulf of Guinea is being hit by the activities
of the gangs. They dump oil into the Gulf of Guinea that they cannot
“crack” (break up by heating to reduce its thickness and enable it to
flow through pipelines). Their makeshift distilleries are so inefficient
that they treat only a third of the raw oil, leaving the rest as waste.
The wood used in the cracking process is hacked from forests across the
Niger delta, adding to the environmental blight.
Mrs Alison-Madueke says: “It is devastating. There are vast portions
of white landscape with trees falling over. The communities don’t yet
understand the extent of environmental damage.”
The polluted environment is giving rise to cancers and other fatal
conditions and Mrs Alison-Madueke added: “We are beginning to see the
results of this damage with babies being born with disabilities in
certain parts of the Niger delta.”
The “very powerful, very well funded cabals” drill holes in the
pipelines to draw off the oil. It is “cracked” and transported via
separate pipelines to barges close to shore, which move it to ships
further out. “Those ships are going to refineries around the world. When
the refineries refine that product, the fiscal output and profit is
laundered through fiscal entities in other regions of the world. That
answers why the global community needs to assist,” said Mrs
Alison-Madueke.
Nigerian armed forces have sought unsuccessfully to combat the oil
thieves. No sooner is one hole on a pipeline shut or one illegal
distillery closed down than two others have replaced them. Over a
three-week period, the navy blocked 600 illegal distilleries, only to
find that 400 new ones had been created in their place. “The Nigerian
joint task forces are running from pillar to post to deal with it.”
Gangs are using the proceeds to run other criminal operations in the
region, including kidnapping, piracy, and hostage-taking. Some of the
millions paid to the oil gangs are thought to have made their way to
Islamic rebels linked to al-Qa’ida in the north of Nigeria.
Some observers say the scale of the theft is so vast that it could
not take place without complicity at the highest level. One oil trader
argued that the proceeds of illegal shipments were “an informal funding
arrangement for local chiefs to ensure their support for federal
government policies”.
Mrs Alison-Madueke says that the growth in criminal activity in the
region is “a negative consequence of the feverish crude oil business
activity”.
Finger-printing technology is used to identify oil that comes from
legitimate sources, and so “interrupt sales of illegal crude by criminal
gangs”, says the minister. She seeks international support for
governments to curb the laundering of funds derived from the sale of
illegal crude.
“We seek to improve revenue transparency and ensure accountability for every barrel produced.
“Many innocent people are losing their lives as a consequence of oil
theft in the Gulf of Guinea. Oil theft constitutes critical economic
sabotage, causing a drastic reduction in the revenues accruing to the
state from the hydrocarbons sector, negatively impacting the state’s
ability to fulfil its obligations to its citizens.
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