OSUN DEFENDER

Floods Slash Nigeria’s Crude Production by 500,000bpd

alison The recent wave of tragic floods in most states of the country has drastically reduced Nigeria’s crude oil production by 500,000 barrels per day (bpd), the Department of Petroleum Resources (DPR) has said.

The revelation came barely 10 days after the Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, had said that the floods, which have disrupted socio-economic activities in most states of the country including the Niger Delta, did not have any adverse effect on the country’s crude oil production.

Alison-Madueke, who described the development as a national disaster, had insisted that key oil and gas installations in the Niger Delta were still intact and had not recorded any damaging effect from the floods so far.

Alison-Madueke had said: “At this point in time, we have not received reports that any of our major installations are adversely affected but we are still taking reports as we speak and if the level continues to rise, we will find out what the impact will be, but as at now, we have no report to that effect.”

But in a statement Tuesday, the Director of DPR, Mr. Osten Olorunsola, disclosed that the floods in oil-producing areas had led to a sharp drop in the country’s production to 2.1 million barrels per day (mbpd) from the 2.5mbpd recorded before the rains.

He however explained that production has begun to ramp up and has peaked at 2.3mbpd.

He said both big and small oil producers were affected by the floods, but noted that smaller producers, particularly the marginal fields’ operators were the worst hit, with quite a number of firms completely shutting in oil production.

“We had quite a very unfortunate situation of flooding in the last couple of weeks and that certainly dipped production by 500,000 barrels per day.

“Quite a lot of oil firms and companies were hit. Actually some companies were completely out.

“Companies like Sterling Energy, and other little companies, especially the marginal field players. Even the big players got seriously hit; Total was completely out in OML (Oil Mining Lease) 58; Agip was seriously hit at Obiafo, Mbede and Oguta, among other areas.

“They were really down and the total shut down at the peak was about 500,000 bpd,” Olorunsola said.

The director, however, revealed that the country’s crude oil reserves stood at 31.170 billion barrels by last month (September), while condensate was put at 5.018 billion, bringing total liquids to 36.2 billion barrels.

Also, total gas reserves were put at 182.750 trillion standard cubic feet (scf), of which non-associated gas (NAG) was 90.150 trillion scf.

He also disclosed that the volume of associated gas flared had reduced to 1.4 billion cubic feet per day, representing about 18 per cent of total gas produced as against 25 per cent by the end of last year and a reduction by about 5.7 per cent.

Olorunsola also said the DPR was on the verge of renewing expired licences for shallow water projects operated by Exxon Mobil, Shell and Chevron.

Meanwhile, the Shell Petroleum Development Company (SPDC) has declared a force majeure on exports of Forcados and Bonny Light crude oil grades owing to a recent fire on the Bomu-Bonny Trunkline, the damage to the pipeline and flooding that affected its Bonny operations.

The oil giant said Bonny crude loadings had been affected as the result of a production deferment caused by the fire incident on a bunkering ship on the Bomu-Bonny Trunkline and production deferment from a third-party producer caused by flooding.

Shell last month shut its Bonny pipeline and deferred 150,000 bpd after a third party vessel suspected to have been involved in crude theft caught fire. The Bomu-Bonny Trunkline conveys crude oil to Bonny Terminal.

Bloomberg quoted Shell to have confirmed that flooding had affected its Bonny operations, while attacks on the pipelines of its local subsidiary caused the majority of its problems.

The company said it was working to repair the pipelines, but gave no estimate as to when the lines would be running at capacity again.

Bunkering is likely to continue because those in power in Nigeria personally benefit from the theft, Bloomberg reported.

A United States diplomatic cable leaked last year quoted a Nigerian official as saying that politicians, retired admirals and generals and the country’s elite all take part in oil theft in the Niger Delta.

culled from Thisday

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Posted by on Oct 24 2012. Filed under AFRICA, ANNOUNCEMENT, FEATURE, FOR THE RECORDS, From The Press, Front Page Story, MEDIA HIGHLIGHTS, NEWS, News Across Nigeria, Niger Delta, POLITICS. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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