The struggling oil and gas sector in Nigeria has encountered another blow as the country’s crude oil production dipped to a three-month low of 1.081 million barrels per day (bpd) in July. This setback can be attributed to ongoing crude oil theft and a leak at the Forcados terminal in the Niger Delta region.
Data sourced from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and made available to THISDAY, revealed that, excluding April which marked the lowest output for 2023, July’s production ranks as the second-lowest for the year so far.
This decline in oil output implies that Nigeria fell short by a substantial 661,000 bpd during the reviewed period. Notably, the Organization of Petroleum Exporting Countries (OPEC) had allocated the nation a quota of 1.742 million bpd for this timeframe.
In addition to the persistent challenge of crude oil theft, Shell Petroleum Development Company (SPDC) added to the woes when it suspended operations at the Forcados crude oil terminal in mid-July due to a leak at the export terminal. This suspension further dashed the prospects of the country’s anticipated gradual production recovery.
The Forcados facility experienced a dramatic drop in production, plummeting from 7.085 million barrels in June to a mere 2.82 million barrels in the reviewed month. Shell attributed the halt to a suspected leak near the single-buoy mooring facility. Activities were suspended to conduct investigations upon the observation of a sheen in the mooring vicinity.
It is noteworthy that the Forcados crude oil terminal had registered the highest crude oil output among the seven major crude terminals in the nation in June 2023, as highlighted in a prior NUPRC report.
Throughout the year, the Forcados terminal witnessed fluctuations in crude oil production, ranging from five million to seven million barrels per day. This trend was characterized by modest declines in March and April 2023. In May, the terminal, situated in Delta State, managed to bolster crude oil and condensate output to 7.01 million barrels per day, a significant increase from 5.78 million bpd in April.
However, the latest figures released by the NUPRC indicate that when including condensates, which are not considered in OPEC’s output calculations, Nigeria’s crude oil production stood at 1.29 million bpd in July 2023.
Beyond the challenges at the Forcados terminal, another significant terminal that witnessed a production decrease was the Bonny terminal. Its production dropped to 2.2 million barrels in July compared to 2.7 million barrels in June.
In addition to the Forcados leak, oil theft continues to plague the Niger Delta region. Data from the Nigerian National Petroleum Company Limited (NNPC) shows that between July 15 and July 21, 2023, alone, there were 240 incidents of crude oil theft recorded. Similarly, from July 22 to July 28, there were 139 reported incidents of crude oil theft, according to the national oil company.