Nigeria must eradicate oil theft in eight months-NNPC

ABUJA, Sept 1 (Reuters) - Nigerian authorities hope to put an end to rampant oil theft in eight months by increasing drone and naval monitoring of territorial waters and working with local communities, the state oil company chief said on Tuesday.

The Niger delta has been plagued by oil theft for years that has left the region heavily polluted and prompted foreign oil companies, particularly Shell (LSE: RDSB.L - news) , to sell onshore assets.

"We must eradicate oil theft in eight months ... Most of our product pipelines are ruptured and attacked frequently," Emmauel Ibe Kachikwu, head of the National Nigerian Petroleum Corp, said in an emailed statement.

The reason for the deadline was not immediately clear.

President Muhammadu Buhari has said that about 250,000 barrels per day (bpd) of crude is stolen in Nigeria, which produces just over 2 million bpd of oil.

It (Other OTC: ITGL - news) is used in hundreds of illegal refineries and even for export. Gas pipelines dependent on crude flows are sometimes forced to close and are even tapped by mistake by those looking for oil, which in turn disrupts electricity production.

Meanwhile, the infrastructure delivering crude to Nigeria's refining system became so degraded that the state oil company was forced into expensive supply contracts by sea.

"We are launching an armada of approaches, which will include the incorporation of drones to check movements of vessels within our territorial waters," Kachikwu said.

The country has limited and poorly maintained drones. Those purchased from an Israeli firm several years ago and that might have been used in the fight against the Islamist insurgency in the northeast of the country have become grounded.

Kachikwu said the "logistical nightmares" of staff changes at the crude export terminals would also be examined and that the navy would be better equipped to run patrols in the area.

"The best security for these pipelines lies with the communities. We are trying to create enough incentives for them to see these pipelines as their own," Kachikwu said.

Under former president Goodluck Jonathan, ex-delta militants that attacked oil installations in the early 2000s were given pipeline protection contracts after an amnesty, but theft continued to grow and spiked ahead of March's election. (Reporting by Julia Payne and Camillus Eboh; Editing by Alison Williams)