FG Admits NNPC Lacks Funds to Rebuild Expired Pipelines, Calls for PPP Solutions
By Matthew Eloyi
The Federal Government has acknowledged that the Nigerian National Petroleum Company Limited (NNPC) lacks the financial capacity to rebuild the country’s ageing and corroded pipelines.
This was disclosed by the Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, during the Energy and Labour Summit 2024, organized by the Petroleum and Natural Gas Senior Staff Association of Nigeria in Abuja.
Speaking on the challenges posed by the divestment of international oil companies and the need to boost production, Lokpobiri emphasized the urgency of repairing Nigeria’s pipelines, many of which were built in the 1960s and 1970s and have long exceeded their lifespan.
“Part of our problem is that pipelines that were traditionally transporting our crude were built in the 1960s and the 1970s, and the lifespan is since over. We have identified that even when we can produce, evacuation is a big problem,” Lokpobiri explained.
He pointed out that the dilapidated state of these pipelines makes them vulnerable to vandalism. “The reason why pipeline vandalism is very easy to do is because the pipelines have all expired—they are completely corroded, and so, anybody can just go and tap it, and the thing is busted,” he said, adding that while better, more advanced pipeline technologies exist, they are costly.
Lokpobiri questioned whether the NNPC, as a joint venture partner, has the financial resources to replace these outdated pipelines. “Now, the NNPC that is our joint venture partner, do they have the money to be able to replace these pipelines? I think NNPC will speak for themselves whether they have the money to be able to do that, and I don’t think they have,” he remarked.
As a solution, the minister advocated for public-private partnerships (PPP) to address the issue. “That is why we have to go for the global model—PPP. We have to get the private sector to come in,” Lokpobiri stated, emphasizing that investor confidence, which has been lacking in the past 12 years, is crucial for attracting foreign investment into the nation’s oil infrastructure.
