Nigerian Oil and Gas Industry Local Content Development Act an Appraisal

Cali Ojimba and Chinedu Ifeinwa Lilian

Faculty of Law Chukwuemeka Odumegwu Ojukwu University Igbariam Campus Anambra State Nigeria

ABSTRACT

Distribution challenges in the petroleum industry in Nigeria have contributed to issues such as petroleum products theft. These challenges include inadequate infrastructure, pipeline vandalism, smuggling and illicit activities in the downstream sector. The theft and illegal diversion of petroleum products have had significant economic implications for the country. Theft and illegal activities in the petroleum sector have resulted in revenue losses for the Nigerian government, it is estimated that Nigeria has lost billions of dollars over the years due to these activities. The stole petroleum products are often sold on the black market or smuggled to neighboring countries, where they fetch higher prices. This not only leads to financial losses for the government but also undermines the effectiveness of the Petroleum Profit Tax Law and hampers the development of the country.  Several factors contribute to the prevalence of petroleum products theft in Nigeria. Inadequate security measures along pipelines and storage facilities make them vulnerable to theft and sabotage. Criminal networks involved in illegal activities have exploited these vulnerabilities for their gains: Additionally, corruption and collusion among certain individuals within the industry have facilitated the illicit activities. More so, the Nigerian government has taken steps to address the issue. Security agencies have been deployed to protect pipelines, and efforts have been made to strengthen collaboration between security forces and oil companies. The government has also established specialized task forces and enacted laws to curb petroleum products theft and punish offenders. However, the problem remains persistent, and a comprehensive approach involving enhanced security, technological advancements, and increased transparency and accountability is necessary to effectively tackle the issue. In order to address this situation, this study seeks to s amine administrative challenges inhibiting the distribution of petroleum products under the Petroleum Profit Tax Laws of Nigeria.

Keywords: Nigerian Oil, Gas, Industry, Theft and illegal

CITE AS: Cali Ojimba and Chinedu Ifeinwa Lilian (2025). Nigerian Oil and Gas Industry Local Content Development Act an Appraisal. NEWPORT INTERNATIONAL JOURNAL OF LAW, COMMUNICATION AND LANGUAGES. 5(1): 10-15.  https://doi.org/10.59298/NIJLCL/2025/5.1.101500