Oshiomhole queries excess crude savings

Adams Oshiomhole, governor of Edo state, has alleged that “barely $3 billion is in the Excess Crude Account (ECA), which ordinarily should have over $30 billion”.

Oshiomhole, who was speaking when the Association of Enigies from Edo South senatorial district, paid him a visit, said Nigeria has been losing 700, 000 barrels of oil everyday for the past 12 years to crude oil theft, describing the act is currently worse than it was during the era of the militancy in the Niger Delta.

He lamented that the lack of access to the crude account funds by state governments was hindering developments in different parts of the country.

“From the last time we had a meeting, the handouts they distributed show that sometime for a period of two weeks, we were losing as much as 700,000 barrels a day and that has been on for the past 12 years,” he said.

“I am not able to understand why, suddenly, Nigeria cannot protect its territorial waters because the boundaries have not changed and the people are still the same and at the peak of the so-called militancy, we were still exporting about 2 million barrels a day.

“Then how can we explain that after we have resolved the issue of militancy in the Niger Delta, we have rehabilitated the ex-militants and even awarded contracts to them, that we are losing as much crude oil as that to oil thieves and to the best of my knowledge, there is no major known person who has been prosecuted and convicted for oil theft in a way that reflects the magnitude of what is allegedly stolen.

“What this means is that our budgets have not performed over the past three years whereas the budgets have been based on an average of between $77 to $78 and $79 a barrel. The average price of Nigeria’s sweet crude has been around $108 per barrel.

“That gives a surplus of over $30. Ideally, we ought to be saving $36 per barrel and 2.3 million barrel a day over the past three years and if you look at these numbers you will find that what we have in our excess crude oil account should be over $30 billion but as we speak, we have barely $3 billion in our excess crude account.”

Lamenting that the federal government had not shared money from the excess crude account with state governments for about 18 months, Oshiomhole claimed that the development had hindered the establishment of beneficial projects in different states.

He claimed that the account had almost become empty, accusing the federal government of mismanaging the country’s resources.

“Over the past 18 months, we have not shared the excess crude account and yet, the account is empty,” he said.

“Sometimes, we are told that they have taken money from it to fund subsidies, including subsidy on kerosene, but your royal highnesses, there is nowhere in your various domains where kerosene is sold for N50. So in the name of subsidy, large sums of money are being stolen.

“Things are tough now around the country because the federal government mismanaged our national resources and what is being stolen, nobody agrees it is being stolen.

“What is arguable is, who is responsible for this stealing? When the federal government and the president talk about oil theft and the amount that is allegedly stolen is huge such that whereas we have the capacity to produce about 2.4 million barrels a day, what accrues into the federal government account is less than 1.8 million barrel a day.

“Now, oil price has dropped to $60 and because we have not saved, the naira is undergoing devaluation. Already as low as N180 per dollar and I believe by February when the elections are over, nobody is going to want to hold the naira. Wherever the election goes, I expect that the naira will hit over N200 per dollar.

“The inflationary consequence of that is prices of everything will go up and part of the vicious cycle of the devalued naira in the manner that is being done is that the price of petroleum products imported in dollars will go up in naira and government will be asking people who are already poor to pay more money for petroleum products.”