July 13, 2024

Nigerian Govt. introduces upstream petroleum measurement, advance cargo declaration regulations to address crude oil theft


Oredola Adeola

The Nigerian Government through the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has introduced Upstream Petroleum Measurement Regulations, and Advance Cargo Declaration Regulations initiated to put an end to some of the factors aiding crude oil theft in the country.

The two regulations and three others including the Significant Discovery Regulations; Gas Flaring, Venting and Methane Emissions (Prevention of Waste and Pollution) Regulations; and Domestic Crude Oil Supply Obligation Regulations were considered during phase 3 of the consultation with the stakeholders which started on Monday, February 6 and expected to end on Tuesday, February 7, 2023, in Abuja.

Engr. Gbenga Komolafe, CCE NUPRC, who was represented at the event by Dr Nuhu Habib, NUPRC’s Executive Commissioner Development and Production, stated that the consultation on the draft regulations was in line with the prescriptions of Section 216 of the PIA 2022.

According to him, the Commission’s commitment to creating an enabling environment for growth and investments in the upstream oil and gas sector defined the focus on working with all stakeholders to ensure that regulations and key policies are developed and gazetted on time.

The Commission’s boss noted that NUPRC initiated the upstream petroleum measurement regulations in response to issues raised by Nigeria Extractive Industries Transparency Initiative, NEITI, on the need for the government to ensure an accounting system for hydrocarbon measurement.

“So Petroleum measurement and cargo declaration regulations are principally designed to upgrade and optimise the hydrocarbon measurement framework in the upstream sector of the petroleum industry in Nigeria to align with international best practice,” Engr Komolafe said.

The CCE further noted that the hydrocarbon measurement regulations would help the country ascertain the actual volume of Nigeria’s hydrocarbon production, from wellheads to export terminals, vessels, and destinations.

Kelechi Ofoegbu, Executive Commissioner, NUPRC, Economic Regulation, and Strategy Planning, while giving a further explanation on the crude oil measurement regulations, said it would give the regulator the platform to know exactly what was produced by different upstream oil operators.

He said, “All through the years of production in this country, there’s always been the question of how much we produce and how much we consume, from upstream to midstream to downstream.

“And we say it is enough already because we should have come to the level of maturity as a producing nation that gives us the ability to stay in a room to monitor our hydrocarbon movements.

He said the measurement regulations were supposed to put paid to this issue, while the Advanced Declaration Regulations would give visibility on every vessel that was coming to load in Nigeria.

“You know this crude theft thing; I think it is embarrassing that as a people we don’t know how our crude is stolen, yet our crude makes its way to the international markets.

“I know that a portion of it is refined locally by our brothers in the creeks, but the bulk majority ends up in the international markets and vessels come here to load.

“This is basically supposed to target the DNA of the vessels that come in-country with the view to saying, where are you coming from, what’s your registration status, how much are you loading, what’s the destination of the crude that you’re taking, where is it going to be refined, what quantity and quality of crude, have you discharged and how much did you discharge,” Kelechi said.