March 20,2025/CSL Research

On 19 March 2025, an explosion occurred at a pipeline manifold in the Omwawriwa area of Ogba-Egbema-Ndoni Local Government Area (ONELGA), Rivers State. The affected facility, which connects to a federal pipeline, transports petroleum products from Seplat, Agip, and Shell, supplying ONELGA, parts of Imo State, and Brass in Bayelsa State. This marks the second pipeline explosion in Rivers State within 48 hours.

Earlier, the Trans-Niger Pipeline (TNP) in Bodo Community, Gokana LGA, was also hit by an explosion. The TNP, a critical infrastructure capable of transporting 450,000 barrels of crude oil per day, connects onshore oilfields to the Bonny export terminal. The TNP is owned by Renaissance Africa Energy Holdings, a consortium comprising Nigerian firms ND Western Limited, Aradel Holdings Plc, First Exploration & Petroleum Development Company Limited, and the Waltersmith Group, along with the international energy company Petroline. Renaissance recently acquired full ownership of Shell Petroleum Development Company of Nigeria (SPDC).

The growing insecurity in Nigeria, particularly in oil-producing communities, poses a serious threat to the Federal Government’s revenue generation. Crude oil has long been a major source of government earnings and foreign exchange. However, over the years, crude oil theft, pipeline vandalism, and illegal bunkering have significantly impacted production.

In response, successive governments have implemented various security measures to protect
oil installations across the creeks of oil-rich states. More recently, the Federal Government outsourced the protection of crude oil pipelines in Bayelsa, Delta, Edo, Ondo, and Imo States to five private security contractors. Among them are security outfits linked to former militants Government Ekpemupolo (Tompolo) and Asari Dokubo.

Although the recent explosion on the Trans-Niger Pipeline (TNP) has been brought under control and operations have resumed after a temporary shutdown, concerns remain over the extent of the damage and its potential impact on Nigeria’s crude oil earnings. A reduction in average daily oil output could further strain revenue generation. In February 2025, domestic crude oil production—including condensates—stood at 1.67 million barrels per day (mbpd), falling short of both the January 2025 output of 1.74 mbpd and the Federal Government’s 2025 budget target of 2.06 mbpd. The latest explosion is expected to affect production from the Bonny terminal, which recorded an output of 6.3 million barrels in February—the second highest after the Forcados terminal—down from 8.1 million barrels in January.

Nigeria’s fiscal position remains fragile, largely due to inadequate security for critical oil sector installations—the country’s primary revenue source. Beyond concerns over environmental damage and economic losses, the decline in oil production has broader implications, including depletion of foreign exchange (FX) reserves, and currency depreciation. Compounding the challenge, global crude oil prices currently hover around US$70 per barrel—below the 2025 budget benchmark of US$75 per barrel—further weakening revenue prospects for the ₦54.99 trillion 2025 domestic budget.

Click here to download full report: ​​CSL Nigeria Daily – 20 March 2025 – Insecurity.pdf