Nigeria records highest drop in output at OPEC

14 August 2016, Lagos -Nigeria is fast losing its clout among global oil producers as the country recorded the highest drop in crude production in the Organisation of Petroleum Exporting Countries (OPEC) in July.

oil barrel stack.oil priceOPEC, which accounts for at least 40 per cent of the global oil supply market, yesterday put unplanned crude oil supply disruptions among its members at 2.3 million barrels per day (mbpd) in July, due to increased outages in Nigeria and Libya.

To crown an already bad situation, Nigeria will also be losing revenue from gas supply suspension, as Royal Dutch Shell Plc, on Wednesday, declared Force Majeure on a single pipeline that supplies liquefied natural gas to the Nigeria Liquefied Natural (NLNG) gas plant.

Already, Nigerian Petroleum Development Company (NPDC) is losing N20 billion monthly to the closure of the Forcados export line, according to the Nigerian National Petroleum Corporation (NNPC).

NPDC would have lost a substantial portion of estimated crude oil sales of over N120 billion by the end of September when the export line may have been repaired.

OPEC report released yesterday revealed that Nigeria recorded the highest decline in crude oil production in July. The organisation disclosed that Nigeria’s crude oil production dropped from the 1.549 million bpd it recorded in June to 1.508 mbpd in July. This is far less than the country’s target of four million barrels daily and the expected 2.2 million bpd estimated in the 2016 budget.

 Secondary sources have it that OPEC-14 crude oil production (following the rejoining of Gabon on 1 July), averaged 33.11 mbpd in July, an increase of 46 bpd over the previous month. Crude oil output increased mostly from Iraq, while production in Nigeria showed the largest drop.
Shell Petroleum Development Company (SPDC) spokesman, Precious Okolobo, who confirmed the last disruption in flow of gas to NLNG, told The Guardian that the leak occurred on the Eastern Gas Gathering System, or EGGS-1, pipeline which supplies the bulk of Shell’s gas to the Nigeria LNG plant on Bonny Island. Some supply continues through other pipelines.

He said: “SPDC on August 8, declared Force Majeure on gas supply to NLNG following a leak on the Eastern Gas Gathering System (EGGS-1) pipeline through which it supplies the bulk of its gas to NLNG. The pipeline has been shut down for a joint investigation into the cause of the leak and repairs. SPDC continues to supply gas to NLNG through other pipelines.”

Militancy in the Niger Delta has resulted in the declaration of Force Majeure on Nigeria’s major export pipeline since February this year.


  • The Guardian
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