FG Says NNPC has no Money to Repair Old Pipelines.
The Federal Government has announced that the Nigerian National Petroleum Company Limited does not possess the funds required to rehabilitate its aging pipelines. This declaration was made by the Minister of State for Petroleum Resources, Heineken Lokpobiri, during the recent Energy and Labour Summit 2024, organized by the Petroleum and Natural Gas Senior Staff Association of Nigeria in Abuja.
While addressing the issue of international oil companies divesting from Nigeria, Lokpobiri highlighted the urgent need to repair the country’s old, corroded, and outdated pipelines. He pointed out that even if Nigeria manages to produce over 1.7 million barrels of crude oil, the significant challenge lies in transporting it to the terminal.
Lokpobiri stated, “Part of our problem is that pipelines that were traditionally transporting our crude were built in the 1960s and 1970s, and their lifespan has long since expired. We have recognized that even when production levels rise, evacuation remains a major issue.”
He further explained that the ease of pipeline vandalism is largely due to the deterioration of these pipelines. “The pipelines have completely corroded, making them easy targets for tampering. However, there are better and more expensive technologies and pipeline systems used in other countries that we need to consider.”
The minister expressed doubt about whether the NNPC, as a joint venture partner, has the financial capacity to replace the aging pipelines. “I think NNPC will have to clarify their financial situation, but I don’t believe they have the necessary funds,” Lokpobiri asserted.
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In light of these challenges, he advocated for public-private partnerships (PPPs) as a viable solution to repair the old pipelines. He emphasized the importance of attracting private sector investment to address these infrastructure issues effectively.
Lokpobiri stressed that for private investors to commit to Nigeria, they must have confidence in the country’s stability and investment climate. He noted that this confidence has been lacking over the past 12 years, resulting in a significant decline in foreign investment.
In conclusion, addressing the deteriorating pipeline infrastructure through innovative partnerships and investment strategies is crucial for Nigeria to enhance its oil production and transportation capabilities.
