Illegal Bunkery

Topics: Petroleum, Nigeria, Fuel oil Pages: 13 (3320 words) Published: October 20, 2011
The Political Economy Of Illegal Bunkering In Nigeria


Kòmbò Mason Braide (PhD)

Port Harcourt, Nigeria


Demonise & Diabolise:

The Niger Delta has been a source of illicit international business deals (like the trans-Atlantic slave trade), as far back as the 15th century. Today a new form of syndicated criminal proclivity is threatening the very foundations of Nigeria’s petroleum industry, and by extension, the Nigerian economy, as well as putting tremendous pressure on Chief (General) Olusegun Obasanjo. That problem is the "illegal bunkering" of crude oil and/or its derivatives.


The term "bunkering", (whether legal or illegal) has been thoroughly abused, demonised, and misused in Nigerian parlance, so much so that the mere mention of it readily evokes, connotes, or triggers subliminal suggestions of grand illegality in the Nigerian paradigm. For example, when petroleum products pipelines get cannibalised, the Nigerian mind very effortlessly visualises "illegal bunkering" in progress. When shiploads of crude oil (from refineries) get stolen, and are routinely sold off as low-pour fuel oil (LPFO) - a relatively cheaper commodity in the international oil markets - Nigerians simply smile, and know, at the very bottom of their very naive hearts, that "illegal bunkering" has definitely taken place.


While in the Nigerian worldview, "bunkering", (whether legal or illegal), is synonymous with stealing petroleum (or/and its derivatives), in Oxford English, "bunkering" is a legitimate process whereby a duly licensed operator provides fuels, water, and lubricants (bunkering services) for marine vessels on request. Simply stated, "bunkering" is the fuelling of ships. It is like having a floating fuel service station on the high seas, or at coastal jetties, to fuel, or/and supply provisions for ships.


Bunker fuel consists mainly of automotive gas oil (AGO), which has been perennially scarce in Nigeria, and low pour fuel oil (LPFO), an environmentally unfriendly residue of petroleum refining operations. Ironically, at the very core of this rather twisted perception about bunkering, is the near-zero availability of locally refined petroleum products from Nigerian refineries, for (legal) bunkering.


Bunkering is the main activity within the Port of Gibraltar in the Mediterranean region. Singapore, another world-class bunkering centre in South East Asia, is a non oil-producing nation. Most Nigerians would be shocked (and awed) to know that Gibraltar is one of the largest bunkering ports in Western Europe, and its bunkering companies continue to grow from strength to strength. Over 6,000 vessels are served each year. In 2002 alone, over three (3) million metric tons of bunker fuels were delivered from Gibraltar. Gibraltar’s many advantages include its location near major shipping routes, low port charges, competitive market, and its tax-free status within the European Union (EU). Furthermore, the government closely monitors the market continuously, so as to ensure competitiveness and transparency. Incidentally, there is also a UK-based International Bunker Industry Association (IBIA), of which Nigeria is a duly registered member. The IBIA offers professional technical advice on bunkering.


However, quite unlike Gibraltar, and Singapore, Nigeria is not a known reliable supply source of either crude oil, or refined petroleum products. Consequently, most foreign vessels that come to Nigeria for the purpose of bunkering do so either as a matter of last resort (How for do?), or for the sake of partaking in premeditated mischief and crime: so-called "Illegal bunkering". Most foreign vessels, especially crude oil carriers, take sufficient bunker fuels from elsewhere, in order to ensure hitch-free and hassle-proof services that they know they would most probably not get in Nigeria.


Today, Senegal, Cote D’Ivoire, and South Africa are the main bunkering centres in Africa. Indeed, the...

References: European Energy Focus: "Calsoft Provide Solution for"; (2003).
Osigwe, R.: "Nigeria Potentially Main Bunkering Centre in West Coast of Africa"; Global Energy Security Analysis; Alexander 's Gas & Oil Connections; Volume 7, Issue #11; (18 June 2001).
Braide, K.M.: ‘The Impact of Deregulation on the Downstream Sector of the Nigerian Oil Industry’; (August 2001)
Federal Military Government Of Nigeria: "Special Tribunal (Miscellaneous Offences) Decree No
Federal Military Government Of Nigeria: "Trade Disputes (Essential Services) Decree"; (1976)
Federal Military Government Of Nigeria: "Petroleum Equalisation Fund (PEF) Decree No
Federal Military Government Of Nigeria: "Petroleum Production & Distribution (Anti-sabotage) Decree"; (1975).
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