Despite the abundance of crude oil, Nigeria has consistently fallen short of its oil production targets outlined in national budgets over the past 10 years, according to investigations by Daily Trust.
The country, heavily reliant on crude oil sales, with approximately 90% of its foreign exchange earnings coming from this source, has faced challenges in meeting ambitious projections.
Data reveals that Nigeria consistently failed to meet oil production targets, with average shortfalls ranging from 300,000 to 600,000 barrels per day (bpd) from 2013 to 2023.
In 2013, losses were estimated at $1 billion monthly, attributed to force majeure, oil theft, and illegal bunkering. Subsequent years witnessed ongoing discrepancies between projected and actual production, leading to significant economic losses
The impact on the economy is substantial, with an average monthly loss of N1 billion and an annual loss of N12 billion. This inability to meet production targets has translated to a staggering N120 billion loss over the past decade.
Crude oil theft and pipeline vandalism exacerbate the situation. Recent reports indicate 127 crude oil theft incidents within a week in December 2023. The NNPCL recorded various incidents, including illegal refineries, illegal connections, AIS infractions, and pipeline vandalism, predominantly in Bayelsa, Rivers, Delta, Abia, and Imo states.
In response to these challenges, development expert Joseph Momoh advocates for the deployment of Artificial Intelligence (AI) in pipeline surveillance. He emphasizes the need for a proactive approach, combining human vigilance with AI to prevent imminent dangers.
The Group Managing Director of the NNPCL, Mele Kyari, acknowledges the issue and asserts that addressing pipeline vandalism is a priority. Additionally, he emphasizes the forthcoming role of the Dangote Refinery in mitigating transportation vulnerabilities.
As Nigeria grapples with these challenges, experts underscore the necessity of diversifying the economy beyond oil. The volatility in the oil sector highlights the urgency of prioritizing non-oil exports to ensure a more resilient and sustainable economic future.
In the face of economic losses and ongoing challenges, the call for a strategic shift toward comprehensive solutions, including AI in surveillance and refinery operationalization, becomes increasingly imperative.