Tuesday, 30 July 2013

Nigeria Loses Billions to Inefficiencies in Oil Sector - Watchdog

Nigeria lost billions of dollars as a result of inefficiency and poor management in its oil sector between 2009 and 2011, the country's extractive-industry transparency watchdog said Monday.

Oil theft and pipeline vandalism, a poorly defined pricing methodology, a dilapidated refining sector and excessive fuel subsidy significantly reduced government revenue from the oil sector during the period, the latest audit by the Nigeria Extractive Industries Transparency Initiative, or NEITI, showed.

Nigeria is Africa's largest oil producer and the government is highly reliant on earnings from the oil sector. However, NEITI's latest audit showed the government has lost out on billions of dollars because of endemic problems within the oil sector.

The largest dent to government revenue came as a result of oil theft and pipeline vandalism, a perennial problem in the country's oil-rich Niger Delta. NEITI's audit showed Nigeria lost 136 million barrels of oil with an estimated value of $11 billion to oil theft and sabotage between 2009 and 2011.


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