Nigeria’s billionaire businessman Tony Elumelu, Chairman of Transcorp Group, has, in a surprising manner, waded into the politically charged conversation about possible sleaze in the Nigerian oil sector.
Speaking in a rare interview with the Financial Times of London, Mr. Elumelu insinuated he did not believe the official narrative that Nigeria’s crude is being stolen. Given the nature and logistics of international oil trade, he said only the government and security agencies could explain how the illicit activity takes place and identify and expose those responsible for stealing the country’s crude oil using vessels operating in Nigerian territorial waters.
In the interview, Elumelu expressed his deep concern over the divestment of international oil companies (IOCs) from Nigeria.
Oil Theft
Elumelu, who has personally experienced the impact of oil theft, revealed that criminal gangs have been siphoning crude oil from his pipelines.
In 2022, when the situation became dire, he took to social media to lament the issue, stating, “How can we be losing over 95% of oil production to thieves? Look at the Bonny Terminal, which should receive over 200,000 barrels of crude oil daily; instead, it receives less than 3,000 barrels.”
Nah Today ? pic.twitter.com/cfDQPhpLOj
— Austine not Jay Jay (@AustinINstate) August 10, 2024
In the interview with FT, he said Nigeria’s inability to meet its OPEC production quota is not due to a lack of investment but purely because of theft. He revealed that oil thieves still steal about 18% of the crude from his field, which pumps 42,000 barrels daily.
When asked who was behind the theft, Elumelu responded, “This is oil theft. We’re not talking about stealing a bottle of Coke you can put in your pocket. The government should know; they should tell us.”
“Meanwhile, oil-producing countries are smiling as their foreign reserve is rising. What is Nigeria’s problem? We need to hold our leaders more accountable!”
Elumelu also recalled how the previous administration of President Muhammadu Buhari allegedly blocked him from acquiring an oilfield despite his company – Heirs Holdings, raising $2.5 billion for the purchase. He said the government’s claim that it could not leave such a strategic asset in the hands of a private person “defied logic” in that, ultimately he would have been purchasing it from a foreign private company.
Additionally, Elumelu commented on the “japa syndrome,” supporting the decision of young Nigerians to seek opportunities abroad, given the lack of jobs at home. However, he encouraged those who stay to strive to create an impact and build a legacy.
Shifting Sands
But Mr. Elumelu is not the only business tycoon to express frustrations recently. His friend and Africa’s wealthiest man, Aliko Dangote, appeared to have been at loggerheads with Nigeria’s state oil company, Nigerian National Petroleum Corporation (NNPC), since the advent of the government of Mr. Bola Tinubu, Nigeria’s president.
Dangote said he was being offered to buy crude from his country for his refinery at $4 above market price but was forced to source crude from other countries, including the United States.
At some point, he offered to sell his $20 billion new refinery to the state if that is what they wanted.
The growing concerns among Nigerian local investors and prominent business tycoons under President Bola Tinubu’s administration raise questions about investor confidence and investment safety under this regime.
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