Members of the Joint Task Force (JTF) stationed in the Niger Delta to fight the illegal activities of oil thieves, have been identified as part of the oil theft cartel in a report that details the complex activities of the economic saboteurs.
The report, published by Stakeholder Democracy Network (SDN) in October, but which THISDAY accessed online Thursday, accused top military officials and others of colluding with the oil thieves for pecuniary considerations.
The report was based on 12 weeks of field research by a team of researchers who visited nine illegal refining operations in Rivers, Bayelsa and Delta States and supplemented with 120 key informants’ interviews with oil companies, government representatives and members of civil society groups.
JTF, Operation Restore Hope, which was formed to tackle the militancy in the Niger Delta was rechristened Operation Pulo Shield in 2012 following the reduction in militancy in the area in the aftermath of the amnesty policy of the federal government that brought out thousands of the militants from creeks.
The report estimated that Nigeria is losing about 150,000 barrels of crude oil daily to the oil thieves and going by the computation by Shell Petroleum Development Corporation (SPDC), Nigeria loses $6 billion annually to oil theft.
It noted that a major portion of the stolen crude oil is sold internationally, but about 25 percent is kept back in the Niger Delta for refining and consumption.
According to the report, at the apex of the oil theft chain is the tapping point, the most lucrative part of the business chain, in which some high JTF officers own shares alongside technicians and couriers.
“This research suggests that a relatively small number of senior officers must have criminal ties to the tap point owners, unions and camps managers, as this is where most profits are made,” the report observed.
In addition, the report also noted the involvement of junior officers in the low earning segments of the business: “Because of the relatively small size of protection payments for vessels, it is likely they leave other lower ranking officers to share the relatively small ‘transportation taxes’ from distributor vessels as a supplement to their official wages.
“A consortium typically made up of at least three key parties (security, technical capacity and operational access) own each tap point. During the tapping process, the JTF ensures the surrounding waterways are clear so workers can install the tap without disturbance,” it said.
The report added that outside the tapping points, some members of the JTF and marine police collect cargo-by-cargo “transportation taxes” from boats carrying stolen crude or illegally refined products.
“Essentially a kind of protection money, these fees grant vessels open passage through the transport corridor. During their routine patrols of the inland waterways, officers will stop vessels and demand payments in cash.
“This is often done by a collective group of camp owners in a local community, but does not guarantee they will not be targeted if a clampdown is ordered,” the SDN report said.
Those interviewed during the research claimed that they pay a flat rate fee for each trip and sometimes, the amount varied depending on how much product a ship was carrying (pay-by-volume).
The report quoted a key informant in Delta State as saying, “If harassed by the security agencies during transportation, the middlemen pay security fees ranging from N20,000 - N30,000 per trip ($133 - $200).”
Another source in Bayelsa said: “Sometimes the JTF collect N10,000 from us per trip but still seize our products.”
At other times, the report added, camps in a given area pool their funds to make “regional payments” to security force members involved in protection rackets.
An interviewee said: “Where the need arises, we pay a security fee to the security agencies of N300,000 monthly. We group together to make payments of N20,000 per refining camp, which is collected and handed over to them; they then advise us to ‘be careful’.”
The location, size and number of camps involved all seem to affect the level of payments made to the JTF and others, the report noted.
The report however said that to ensure the safety of the researchers, they deliberately avoided asking detailed questions about JTF officials involved in the organised crime.
“Interviewees for this report described illegal oil refining as an entrepreneurial, free market response to the local economic dysfunction, socioeconomic pressures and government’s failure to provide basic services.
“As the communities’ living environment worsens because of equipment failure and oil released into the environment as part of the refining process, fishing and farming livelihoods deteriorate as water sources are contaminated.
“This increases the need for cash to buy bottled water and imported frozen fish. When so few other economic opportunities exist outside of illegal oil refining, the vicious circle intensifies.
“Unless the economic and political drivers of crude oil theft are dealt with through a credible and more appropriate strategy, the stability of Nigeria’s oil sector could worsen. This risks a return to instability and the country’s primary revenue stream being locked in,” it said.
The report said SDN researchers were told that the problem was worsening, with suspicions that with the approach of the 2015 elections, oil theft and the associated environmental damage it causes will get even worse.
It called for an urgent multi-stakeholder response of government, civil society and the oil majors to combine efforts to raise awareness of the health and environmental impacts of illegal oil refining.
It also urged the federal government to articulate a strategy for dismantling the trade in stolen crude oil, including measures for interdicting shipments of stolen oil, following the money trail and tackling associated security and environmental concerns.