Nigeria’s government has turned once again to a man it previously hunted as a thief and enemy of the state, recruiting him to curb rampant theft on the oil pipelines he used to blow up.
Oil production in Nigeria has plummeted over the past two years, hitting the lowest level in about half a century. The government blames rampant crude theft, pipeline sabotage and illegal refining, which it says siphons off as much as a fifth of output every day. To stem the losses, the state-owned energy company has hired security companies linked to one of the most feared of the Niger Delta’s onetime warlords: Government Ekpemupolo.
“We are going to move into serious action where we will stop all the illegal activities in the Niger Delta region,” Ekpemupolo, 51, more commonly known as Tompolo, told reporters on Sept. 2 in the town of Oporoza in Delta state.
Few people know more about wreaking havoc on the Nigerian oil industry than Tompolo, who — as a leader in a loose coalition of heavily armed rebels — waged a campaign from the mid-2000s for greater local control over the delta’s hydrocarbon wealth. Their attacks slashed nearly a third from peak production of 2.5 million barrels a day, before he and his peers accepted a government amnesty that granted them lucrative pipeline surveillance contracts and put an end to the violence.
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That truce soured after President Muhammadu Buhari came to power seven years ago, terminating the contracts and renewing hostilities with Tompolo in particular — as of this week he is still listed as a wanted man by the country’s anti-corruption agency.
But daily production is currently nearly 800,000 barrels lower than it was at the militants’ peak, while the Nigerian government is spending billions of dollars subsidizing gasoline and earning less than its debt-service bill.
At a media briefing last week, Mele Kyari, chief executive officer of the Nigerian National Petroleum Co., defended the decision to hire, among others, two companies connected to Tompolo as part of a plan to use private security to protect the vulnerable pipelines that crisscross the delta in the south of Africa’s largest crude producer.
“Contractors were selected through a tender process for people who can do it,” he said on Aug. 30. “Not everyone can do it.”
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Tompolo has stakes in two of the companies contracted by the NNPC — Tantita Security Services Nigeria Ltd. and Matton International Services Ltd. — according to his spokesman, Paul Bebenimibo.
“We don’t want to be second-class citizens in this country because we produce the oil that feeds everybody in this nation,” Tompolo said in the Sept. 2 television interview. His argument echoed those made by militants in the late-2000s to justify attacks on pipelines.
Average daily crude production in Nigeria fell to about 1.2 million barrels in July from about 1.9 million barrels as the Covid-19 pandemic struck in the first quarter of 2020, according to data compiled by Bloomberg. The unfolding collapse has left the country unable to meet its OPEC+ quota or to benefit from high oil prices.
Top military officials have disputed the levels of theft advanced by the NNPC and other oil companies, pointing to the firms’ inability to maintain aging facilities or good relations with local communities. But Kyari said Nigeria could be producing up to 700,000 barrels a day more if not for criminals stealing crude and oil companies holding back for fear of theft.
“There is no company that will produce oil and then lose 80% of that and continue to produce the oil,” he said.
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Companies injecting into onshore pipelines in the eastern Niger Delta are facing the most trouble. The Shell Plc-operated plant at Bonny, Nigeria’s largest export terminal, received an average of only 42,000 barrels a day in May, less than a fifth of 2020 input, according to government data. Sixty miles away, the Eni SpA-owned Brass terminal has experienced a similar deterioration.
Since June, the 180,000-barrel-a-day Trans Niger Pipeline, one of two that feed Bonny, has ceased transporting oil altogether due to theft. The pilfered haul is either turned into black market fuel at illegal refineries in the delta or barged out to sea for sale overseas.
Now the government is betting on one of the men responsible for a previous production crisis to resolve an even larger dip, despite accusing him in 2015 of being behind a new wave of attacks and seeking his arrest in early 2016 for an alleged 46 billion-naira ($106 million) fraud.
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Tompolo told reporters last week that he planned to spread the benefits of the new pipeline security contracts widely in the delta.
“I have been in this struggle for all these years and I know that greed is the cause of all the problems in the country,” he said.
By William Clowes
Bloomberg
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