 While we're back with the breakfast and plus TV Africa and looking at a first conversation, the Nigerian Navy has faulted figures of crude oil being stolen daily in Nigeria by all thieves as being claimed by the Nigerian National Petroleum Corporation. Now the Navy asks the NNPCL to tell Nigerians the truth about the low level of oil production instead of reeling out figures which are very far from reality. It also accused the NNPCL of hiding the real costs of fuel scarcity in the country by continually blaming it on oil theft. Recall that the group general manager of the National Petroleum Investment Management Services, an agency on the NNPCL, had reportedly claimed Nigeria lost about 470,000 barrels per day and amounted to $700 million monthly. Now however, the chief of training and operation of the Nigerian Navy, Royal Admiral Solomon Agada, made this a session when he appeared before the Senate Committee on Anti-Corruption and Order Finance Crime during an interactive session. Agada also revealed that at several meetings with the NNPCL, they had appraised the cooperation about the causes of fuel scarcity by telling them that there was no way anyone would steal 1,000, I beg your pardon, 100,000 barrels of oil in a day, but the NNPCL had deliberately continued to mislead Nigerians. Now this conversation is almost endless, but we have to just take a break at this point and invite our guest, Bolaho Olojide, who is an oil and gas expert. He joins us this morning. Thank you so much, Bolaho, for joining us. Yeah, thanks for having me. So let me take your overview about this session by the Navy. What are your thoughts? Well, I think the Navy is in order by saying some of those figures being bandied around are not, you can't explain them off by just saying they are oil thefts. You see, the resources that are required for that level of stealing is so huge that it doesn't add up. The numbers are not adding up. That is the reality of what the Navy seems to be saying. So there is oil thefts, no doubt about that. We are forcing all those connections to our pipelines and several other things, including the vessel that was chased all the way to Guinea. So there is oil theft. Well, there are other issues that we must also be talking about. I guess that is what the Navy is trying to say. Look, there are issues of infrastructure. Don't forget that for 13 years, we could not pass PIV. A lot of investment that should have been made in our oil and gas sector were not made. So there is serious infrastructure problem. There is also the possibility of thefts that are not happening on the pipelines, that are a documentary sort of theft, in which two is written for four or four is written for five, whatever the case may be, either at the offices or at the terminals, whatever the case is. So it is a cocktail of issues that are going on, and it will be wrong to attribute everything to oil theft. It is not correct. Now, but another issue that was raised by the Navy is that major terminals have not been able to process fuel for export since around February and March 2022. And there is also another report. You talk about remittance. There has been zero remittance to the Federation account or the Commonwealth account, if you like to put. Does this add up? Is there correlation with the statement or the position of the Navy? And the fact there is also a report that we have not been able to remit any amount to the Federation account in terms of our earnings from oil. Okay. The terminal issues that you mentioned, those are the part of the infrastructure problem that I spoke about. The Bonin terminal, the Estic travels, there are issues going on with some of our terminals, and we need to speak about them. Number two, even the pipelines. I'm aware, for example, that the focados, from time to time, it has become almost an annual event that the focados will go down. That is a very old pipeline system. It will be like five decades, four decades kind of investment that we're talking about. So when that pipeline goes down, sometimes it takes several months, five months, six months before it comes up. Those are infrastructure challenges. We need to talk about them and not say everything is a good term. Now, coming to the issue of remittance to the consolidated revenue of the federal government. Now, the NNPC Act allows NNPC to take money for its operations and then remit. The problem with that is that what if the money to take for its operation is such that by the time it takes that money, there's nothing to remit. It means there will be nothing to go back into the Federation account as simple as that. So you make money from crude and then you have all these deals for importation of refined products, which is heavily subsidized. So NNPC is making money from the left and is using it to import refined product from the right. There's a possibility indeed that we may not have anything to put into the Federation account. That is the reality. Now, the kind of inappropriateness that could be going on in that middle because subsidy in itself, the way we have implemented it in this country is a very dark hole of unaccountability. So somebody sells crude, makes money on the right, then they use the money and import refined product into the country and he says, by the time I finish importing the refined product, I don't have anything to remit anymore. What can we do? No, sir, but you have mentioned the issue of infrastructure and which is very critical because if you want to also align that with the thoughts of the Navy, it's something that we have to agree with. You look at the recent revelation from the World Bank saying at the pace which we're growing in might probably take us 300 years to close the infrastructure gap. But what happens to the turnaround maintenance? Looking at 9.5 billion era for turnaround maintenance that's been invested at the time, especially for 2022. So is that not supposed to happen? Sorry, I did not hear what you said for a moment. I don't know if there's a network connectivity issue. I didn't hear what you said. So I'm saying that from the conversation you have talked about the deficit in infrastructure and which is a reality, of course, the pipelines and what of you. But I like to also mention what happens or what about the turnaround maintenance. If we look at how much we have expanded, how much has been spent on maintaining all of this infrastructure, we're looking at figures reported 9.5 billion era. Okay. I still do not hear what you say, but I will just make some other general comment on the subject matter. On the issue of infrastructure investment, we are way behind. Everybody in Nigeria must have seen the viral video of how people monitor oil, oil production is monitored in Saudi Arabia. So in the space of technology, we have deployed some technology, but obviously we have a long way to go. The issue of lack meters to be used at our flow meters and all of those things apparently have still not been put in place. We must be able to monitor in real time the oil production from the various oil wells that we have in Nigeria. And it should not require people jumping into the bush to go and chase where the pipelines are located. Technology is doing all of these things. So we must be ready to invest a little more in technology to solve the problem. On the subject matter of refined products, for all, the solution will be, as a country, to be able to, I don't know if you are still hearing me. If we have infrastructure issues with the oil sector, should the turnaround maintenance funding not cater for that? I mean, should that not solve the problem? We have seen that the TUC have also accused the government of 9.5 billion that has been spent on turnaround maintenance. So should that amount not cater for the issue of infrastructure in terms of the oil sector? Okay. Let's separate two segments of the oil sector now. The crude is a totally different ballgame from the imported refined product. Or refined in general. There is the upstream, which is where the crude comes from. And the issue of refining is midstream to downstream. So the midstream, which is where this refining is taking place, is another segment of the oil sector. The infrastructure for refining is not going to cater to the infrastructure need for the upstream sector. So the issues of pipelines for transporting crude, the issues of a large flow meters, the issues at the terminals, production issues, those are different set of infrastructure requirement as opposed to the infrastructure for the refining of crude, which is what the turnaround maintenance and the rest is taking care of. So but an overview now. What do you think would be the way out of all of this? You see, the way out is that we need to just be a little bit more serious about our oil and gas sector because it is so critical to our survivor at least in the short to medium term. It is so critical. 90%, over 90% of Nigerian foreign exchange come from exploitation of crude. It's from crude oil. Meanwhile, when you look at our production from November 2005, I believe, it has been on the decline. In that November, we had about 2.5 million barrels production per day on the average. And since that time, if you pick up the plot, you will see how everything has declined up until 2022. In 2022, the decline even got much cheaper. So we're not investing. We must invest in infrastructure. Number two is issue of transparency. In the words of the former president, this is oil business. It's a very oily business. A lot of draft issues, corruption issues is so endemic. Money things are not transparent. We need to get more transparent about how we deal with the oil business. We also need to employ technology much more than we are doing today. Some of the things we're asking people to go and sit in the creek and be watching by plant have been done in a room in some other parts of the world. Can we learn to do that? Some of the stealing or irregularity that might be happening at the export terminals will also be dealt with with technology as well. So let's invest more in technology. Let's be more transparent and let's be willing to invest more in our oil and gas infrastructure. But if the federal government has invested in the maritime demand facility or infrastructure just to help with the Navy and dictating illegal thefts, because it feels like we have everything in place, so how then do we still have all of these issues of thefts? There's an investment in that regard in terms of stopping all of these issues. And so we still have the issue of theft which might not necessarily be the major issue. So what exactly are we dealing with? Because it's almost very confusing. On the other hand, the Navy has been accused of not being capable of protecting the waterways and that's why we're having all of these issues. And the Navy is saying, hey, we're doing our bid. That's not a case. We have what it takes to stop all of this. So what is really going on in the oil sector? And how do we even stop this issue? Right now there's a lot of issues with fuel scarcity and it's telling on the economy. We see that the cost of transportation is on the hike and every other thing is also probably on the high as well. Okay. I will start from the issue of increasing price or non-availability of fuel in the PMX and the market. Now, when I said we have to be a bit more transparent in our dealings, if you ask the oil marketers today, the independent oil marketers, they have a totally different story from what NNPC will tell you about why there is no fuel illegal. NNPC last week was telling us that it was because of road repairs that we don't have oil as well to buy in Lagos. On the other hand, the marketers are saying, look, the amount I'm picking the product at the tank farm has changed. Therefore, I'm unable to pick it at those prices as they sell at the regulated price. If you see a place today where people are selling at above pump price, there will be no queue and then people who have traveled out of Lagos will tell you that you're just driving if the price is 260 or whatever. You're driving, you won't see any queue there. So why wouldn't NNPC then come out and say that the reason that there is fuel problem is because there is no, there is a, they are fixing roads in Napa Pa that that is the reason. We have to be more transparent. The communications must make sense. There has to be a articulated manner of, you know, addressing the members of the public, telling them the truth about what exactly is going on. That is, that is on one side. You spoke about investment in the maritime area. Yes, there have been investment in the technology for, for that the Navy can use to know, oh, there's a, there's a ship somewhere waiting to buy. But that is not, that is at the end. When does the ship comes in? The ship comes in. There has been production in the field. Productions have moved from through the pipelines. It has gotten to the terminal. From the terminal it is to be exported. It is at the point of exportation that we have the issues of, oh, I can see a ship that is loading. The question is what has happened from the production to the pipeline to the terminal? Those are all points where anything could have happened to what is going on. So at the production level, are we able to monitor the oil that is being produced across Nigeria today? Are we able to? It's a question to ask. Now, in the pipeline, we have situations in which even production they produce as I say, I put in 100 into the pipeline. At the other end, it is 50 that is coming out. There is no way Navy can deal with that. That is not something that Navy can see. So there are other questions before you get to that point where oil is being loaded onto a vessel. And we must address everything that happened across the entire chain. The entire chain can be policed by technology. So still with that now, you also still have the Navy saying that at this moment that there's no tanker or no vessel that can come into the waterways, the Nigerian waterways without their notification. They will definitely know. The only time that would not happen is if they turn off what it is. But the Navy, they have what it takes to know when you have an external element coming into this space. That's what they are saying. So why then do we keep talking about theft? We all saw those pipelines that were hooked onto our pipe. That is number one. Number two is how internal control works. You see, internal control can collapse in any structure once there is pollution. The case that the Navy was describing is the ideal situation. There could be a situation in which there are compromises, compromises that we even involved in the sea. We've seen in this country in some years past where vessels, entire vessels were being diverted off the coast of Kutunu. People were bringing imported products into this country. On the IEC, they would dispose of that. They would sell it off Kutunu and come to Nigeria and claim subsidy. Was the Navy not around there? They were around. Was the entire Navy structure involved in that kind of a thing? I don't think so. But can there be compromises? The answer is yes. So there could be compromises at the level of Navy. There could be compromises at the level of NNPC. The kind of theft that we are seeing now, did you remember the comment made by the MD of Chevron? He said it is organized crime. In an organized crime situation, the number of parties, players that are involved is extensive. And once these parties agree to work together, they can make a mess of any system. The MD of Chevron is in a position to know what is going on in the oil and gas situation. So if he tells you that there is an organized crime that is going on, there is an organized crime that is actually going on, the Navy has excluded itself, which is expectedly so. What we now need to do if we're serious is at the highest decision level, making a person or organ, we need to give directives to all these institutions to work together. A situation in which the Nigerian customs will go to the north, and the NNPC will go to the south, and the marketers will go to the east. Everybody talking from several segments of how it concerns them, trying to put the blame on other people will not work. It is a chain and if there is a problem along any path in that chain, it will not work. So all the participants, all the stakeholders across the entire chain must work together if we're going to make any headway in this matter. So Navy and NNPC and customs and the Ministry of Petroleum, everybody must work together under a directive by the CEO at the top. The CEO is the President of the Ministry, he's also the Minister of Petroleum. Well, just quickly as we close this down now, it will be my final question to you. With the discovery of new oil wells, especially in Bauchi and Gumbay and the fact that they're fighting, is this a plus to the oil sector? Not necessarily so. The discovery of oil is good from the perspective of some sort of balancing. They have been all this talk about oil coming from the south. Now there is oil in the north. Oil in the north has been found in the landlocked area, so there are serious logistic issues that have to be dealt with. For us to even know the extent of viability of this discovery. The other part that is important and Nigeria must pay attention to is the fact that Biasa State has been an oil producing country forever. In fact, Oluwibiri, which was where the first oil discovery was, is in Biasa. However, that same Biasa is number two on the list of the states with multi-dimensional poverty in this country. That's why the fact that it is also the state with the highest capital income in Nigeria. So that they found oil in your states, it doesn't mean a thing. It is how that resources is managed and deployed to the benefits of the citizens that will make a difference in their life, not that the stoppage of oil. Oil is in Biasa. Biasa is number two on the poverty list today. Well, Oluwibiri, we have to go now. Thank you so much. The pleasure is mine. Here's an oil and gas analyst expert right there. He joined us this morning to make sense of the new revelation from the Navy as regards oil theft and the oil sector generally, especially with some of the claims and proclamations from the NNPCL. That's the size of it. We take a break and when we return, we'll continue with the breakfast. Please, dig in.