Engineering management - Essay Example

The oil and gas sector controls approximately 90% of the global economy. The gross domestic product of many oil producing and exporting countries is heavily reliant on the production of these resources [3]. Exploitation of oil and natural gas is done both onshore and offshore and it is then transported from the wells through pipelines to the refineries. Globally, an average of 2500-3000 billion barrels of oil is produced daily and due to the increasing demand for oil and natural gas, production has increased over the years [1].

Due to the increasing exploitation of oil, it is feared that this important resource will eventually be exhausted and there is need to put sustainable measures of exploitation in order to ensure that the economies are not adversely affected. Due to the increased production of oil, more networks of pipelines have been laid out to transport oil between points [3]. Losses of oil due to spillage and theft has increased substantially and this has mainly resulted from various factors such as: defects in materials, pipes corrosion, erosion on the ground, vandalism of oil facilities and the tectonic forces occurring due to movement of tectonic plates.

The impact of these occurrences can be fatal since they result into environmental pollution, massive fires and if the spillage occurs onshore, marine life is greatly endangered [2]. Nigeria is the leading country in oil theft and spillage. Oil spillage results from corrosion of pipes, poor maintenance of the oil and gas facilities, sabotage, failure of equipment and theft. Multinational companies such as shell that have heavily invested in the country have lost millions of dollars due to oil spillage costing the economy one billion dollars every month [2].

The government of Nigeria has enacted laws to curb oil theft and spillage which enforce heavy