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Curbing Oil Theft: How Indigenous Firm Is Halting Losses

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To boost government revenues from the oil and gas sector, there is the need for the protection of vital oil facilities against theft and wastages in the Niger Delta region. Attempt by an indigenous firm, Ocean Marine Solution (OMS) to halt losses is paying off with a ramp in pipeline surveillance. PATRICK OCHOGA reports.

Providing services in the oil production in Nigeria had been a herculean task to the Nigeria National Petroleum Corporation (NNPC) and the federal government.

The challenges became more daunting following increased agitation and complain of exploitations by people of the Niger Delta from multi-giant oil companies operating within the region.

Obviously, the resultants effect of the agitation gave birth to the formation of different militant’s armed groups that unleashed attack on oil installations and pipelines as the country suffers heavy losses in oil revenues.

Suffice to note that some oil servicing companies engaged by the federal government through NNPC to provide security to oil facilities connived with some scrupulous militants group to steal crude from the same contracts they are awarded to protect.

However, the escalation of attack, destruction of oil facilities, sabotage and the huge loss in oil revenue begin to decline in 2015 when Ocean Marine Solution (OMS), a leading marine security company came to the rescue of the NNPC to protect loss in crude pumped through pipelines.

It is noteworthy to state that prior to the intervention by OMS in 2015/2016, the nation was losing about 40-50% of its crude almost on a daily basis to oil thieves who had constituted themselves into a powerful cabal with the sole aim of bringing the nation’s economy to its kneels for their selfish interest.

OMS came as a rescue mission has successfully put an end to illegal bunkering, oil theft on the Escravos-Warri and Bonny –Portharcourt crude oil pipelines.

As one of the leading asset protection company in the oil and gas industry little wonder their intervention brought sanity, rise in oil production and saving the country of billions of dollars.

One of the core value and achievement that defined OMS professionalism includes the procurement of 45 purpose built patrol boats, , provision of additional , sustainable support for the Nigerian Navy enabling her to maintain a greater presence at sea an enhancing her surveillance and information gathering capabilities.

Others are 100 per cent incident free to date no attacks, no suspicious vessels have breached the maritime zone and the provision of round the clock logistical support to the Navy at zero cost to government.

Having blaze the trail by the provision of world class maritime service, the management of NNPC it gathered had concluded plan to reward the Trans-Forcadoes Pipeline, (TFP) surveillance contract to OMS.

Since the news broke that the OMS again has earned the confidence of the NNPC for the contract of the trans-forcadoes pipeline, sparked rounds of controversy, allegations and counter allegations for and against OMS.

Even as the war over the said award of the contract rages, OMS had maintained a shocking silence in the face of provocation, campaign of calumny and character assassination.

In a bid to clear the tension over the award, the NNPC through its group general manager, Public Affairs, Ndu Ughamadu, had explained that the award of oil infrastructure surveillance contract to Ocean Marine Solutions for the protection of the 87-kilometre Trans Forcados Pipeline (TFP) was to curb losses on the pipeline.

Noting that “the decision to assign the TFP surveillance package to Ocean Marine Solutions was reached after consideration of huge losses on TFP and rigorous appraisal of the company’s impressive record of performance on the Bonny-Port Harcourt and Warri-Escravos crude evacuation lines”.

The corporation said that the new contract which required the contractor to pay for any damage to any inch of pipeline under its watch, offered immeasurable benefits to the NNPC, its Joint Venture partners, the host communities and the entire federation.

“In terms of production numbers, this translates to over 11 million barrels of crude oil which on face value equates to over 800million dollars in lost revenue to all the stakeholders in the matrix which includes: NNPC, its Joint Venture partners and the Nigerian Federation,”  he added.

According to him, no responsible business entity or government will allow this level of haemorrhage to subsist without acting swiftly to protect the enterprise from further bleeding.

Ughamadu noted that the corporation based on the above scenario, assigned Ocean Marine Solution to handle the TFP under the proof of concept arrangement which is yielding great results in the Bonny-Port Harcourt and Escravos-Warri crude evacuation lines.

“Under this package, the surveillance company is obligated to protect the lines and bear the cost of repairs if and when there is any breach to the pipeline.

“This arrangement is totally different from the old order where the contractor gets paid for surveillance duties and totally exempted from repair cost or any form of responsibility in the event of any line break or breach to the pipeline he is paid to watch,” he said.

On the alleged huge cost of the new contract, he explained that the cost of the new deal was insignificance when placed side by side and value-for-money with the old arrangement.

“In 2018, after we lost over 60 days of production, under the old contract, the NNPC and its stakeholders spent over 32mmillion dollars on repairs, protection of the TFP and clean-up.

“This is a verifiable fact which makes the new deal not only better but far more rewarding to all stakeholders,” Ughamadu said.

He also dismissed mounting insinuations that the entry of OMS into the TFP would spell doom for host community youths on the pipeline right-of-way currently rendering sundry services to the old service provider.

However, in a concerted effort by the management of OMS to set the record straight in the face of orchestrated blackmail, however, explained that unlike others, OMS has a successful track-record of securing strategic national infrastructure and stopping illegal bunkering, vandalism and oil theft.

“For example, NNPC spent over $150 million trying to revamp the Escravos – Warri crude pipeline before eventually resorting to moving crude by marine vessels. It is on record that not only did OMS rehabilitate the Escravos – Warri pipeline against the odds but did so while bearing all of the considerable financial risk in order to demonstrate that we could deliver on our promises. Only when we had invested $32 million and proved our concept by revitalising the pipeline did NNPC award us a contract in line with best practices and benchmarks.

“Following the successful delivery of Escravos – Warri, NNPC approached OMS to replicate the achievement on the Bonny – Port Harcourt pipeline. Our efforts led to the formal re-commissioning of those pipelines on 22 and 23 April 2016 by the minister of State, Petroleum Resources and the immediate past group managing director, NNPC.

“Since April 2016, we have delivered 60,177,843 barrels of oil (and counting) to both refineries without any loss to the nation.

“The practical success of OMS whether at Escravos – Warri or Bonny – Port Harcourt, or if we assume responsibility for TFP, is our “Community Engagement Model for Asset Protection”.

“The epicentre of OMS’ values is the company’s faith in the Nigerian economy and our commitment to Corporate Social Responsibility deliverables, including job creation, local economic development of the host communities, training, and retraining of skilled workers and hitherto unskilled labourers. The qualification of our staff is reflective on the quality of our services.

“OMS’ contributions to Nigeria’s economy within the oil and gas industry and our human capacity engagement and development activities in the Niger Delta region are legendary. Suffice to say that OMS is a reputable company that does not engage in any form of corrupt practices, economic crimes, financial crimes or acts of economic sabotage.

“OMS associate companies and her promoters have never been involved in oil swap deals, crude oil sale, or engage in oil trade in the downstream sector or being political jobbers without defined business structure or engagement.

“OMS did not seek out the TFP security and surveillance contract. We were approached and invited to render our services because of the dire security situation and because we have a reputation for delivering results.

Explaining further it added: “In particular, OMS’ impressive record of performance on the Bonny – Port Harcourt and Warri – Escravos pipelines and robust community engagement has earned the trust of NNPC”.

“Indeed, we are pleased to be recognised as the game changer in the restoration of Escravos – Warri and Bonny – Port Harcourt oil pipelines, which were fundamentally damaged by oil thieves and militants and left moribund and abandoned for over five years before OMS stepped in to prove that these valuable pieces of infrastructure were viable when in the hands of the right people.

“OMS has pioneered a lasting solution in the quest for a cost effective and operationally efficient method of supplying Nigeria’s refineries with crude oil feedstock for local refining and consumption. We have shown that Nigeria does not have to accept failure,” it concluded.

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