Nigeria

Nigeria: Oil Production At $32 Per Barrel Too High – Kachikwu

18 Aug 2017   Nigeria

The Minister of State for Petroleum Resources, Ibe Kachikwu, has decried the high cost of oil production at 32 dollars per barrel, saying it makes cost of Foreign Direct Investment very expensive. Kachikwu made the assertion at the 2017 annual conference of the National Association of Energy Correspondents (NAEC), in Lagos. The minister said that the Federal Government was making frantic efforts to bring down the cost to 15 dollars per barrel in order to significantly bring down cost of FDI. “The outcome of this initiative will be a win-win for investors and the nation,” Kachikwu said. He said the Petroleum Industry Governance Bill (PIGB) had been structured to fully turn around the petroleum sector and make it attractive to investors. Kachikwu also said that the security issues and funding gap in the area of refinery had delayed the take-off of refinery projects, even after licences had been issued. […]

Nigeria: NNPC Cuts Production Cost to $23/Barrel

18 Aug 2017   Nigeria

The Nigerian National Petroleum Corporation (NNPC) said yesterday that the country has saved a minimum of $3billion per annum by cutting the cost of crude oil production from $78 dollars per barrel to $23 per barrel as at August 2015, representing 70.5 per cent reduction. The Group General Manager of National Petroleum Investment Management Services (NAPIMS), a unit of NNPC, Engr. Dafe Sejebor, disclosed this during the inauguration of the anti-corruption committee of the unit. A statement issued by the Corporation’s spokesperson, Ndu Ughamadu, noted that NAPIMS arrived at the figure after looking at the difference between the $78 and $23 which represent the old and new cost of production in relation to the present daily average production in the country. “If you knock down your cost of production from $78 per barrel to $23, take the difference and multiply by the average daily production, you will discover that […]

Protesters drag Shell Niger Delta oil facility shutdown into fifth day

16 Aug 2017   Nigeria

Protesters on Tuesday dragged the shutdown of a Shell crude oil facility in the Niger Delta into its fifth day, after storming the flow station demanding jobs and infrastructure development last week. Echoing a common complaint in the impoverished swampland that produces most of Nigeria’s oil, the protesters said they were not benefiting from the region’s oil wealth and wanted an end to the oil pollution that has ruined much of the land. Protesters still numbered around 800 people, praying and cooking under canopies set up at the Belema Flow Station in Rivers state as security personnel watched. Shell had evacuated staff late on Thursday, the day before the protest, and shut the facility when it became clear the demonstrators were on their way there, the company has said. The firm also said last week that its “commitment to the welfare of host communities in […]

Nigeria: We’ll Continue Operation Till You Empower Us, Ex-Illegal Oil Refiners Tell FG

15 Aug 2017   Nigeria

 Former illegal oil refiners in Rivers State have vowed to continue in their illegal dealings in petroleum products until the Federal Government provides them with empowerment.  The artisanal refiners, who are mainly drawn from the Ogoni extraction, noted that they cannot leave their only source of survival until the Federal Government provides them an alternative.  Their position was disclosed to Minister of State for Environment and Chairman, Governing Council, Hydrocarbon Pollution Remediation Project, Ibrahim Jibrin, in Port Harcourt, at a one-day consultative meeting organised by the office of the Project Coordination, HYPREP.  Speaking for the ex-artisanal refiners, Mr. Domka Humphrey said they can only stop refining petroleum products illegally if the Federal Government empowers them and include them in the remediation process in Ogoni.  Humphrey said: “Sir, I will tell you our minds, if you don’t empower us, we will not stop refining, because this is what we feed our families and relations with. We don’t have anything doing after government took away the pipeline surveillance from us.

Nigerian Protesters Storm Shell Crude Oil Flow Station

12 Aug 2017   Nigeria

Hundreds of Nigerians stormed on Friday a Shell-owned crude flow station that feeds the Bonny export terminal, protesting against lack of jobs and demanding infrastructure development, according to a Reuters witness. The protesters were also asking for an end to oil pollution in the Niger Delta and claimed that they were not benefiting from the oil-rich resources in the restive area. The army sent reinforcements to the Belema Flow Station in Rivers State, after the protesters had said that they would remain at the facility for two weeks, according to the witness. It was not immediately clear if the protest had disrupted any operations or if the situation has had an impact on crude oil production. The Nigerian unit of Shell said on July 24 that it had shut its Trans Niger Pipeline due to a leak, while the managing director of the Nigerian National Petroleum Corporation (NNPC) said […]

Niger Delta Legalizes Illicit Oil Refineries

7 Aug 2017   Nigeria

The Nigerian government will make illicit refineries operating in the Niger Delta legal, and will even supply them with crude oil, the presidency announced yesterday. The legalization process will take until the end of the year, and the crude they will process will be sold at a reasonable price. The move, in stark contrast with years of forceful shutdowns of illegal refineries in the poverty-ridden Delta, follows negotiations between the federal government and local community leaders that were aimed at resolving problems, including oil theft that causes spills and losses for pipeline operators as well as lack of jobs in the area. Oil theft is how most of these mini-refineries get the crude to process, and it has been a major headache for Nigeria’s oil industry. Last month, Bloomberg’s Paul Wallace reported that according to Wood Mackenzie estimates, almost a third of the crude that flows along pipelines in […]

Nigeria’s NNPC in funding deals with foreign partners to develop oil fields

3 Aug 2017   Nigeria

Nigerian National Petroleum Corp said Thursday it had agreed new funding arrangements with four foreign partners to develop new oil fields in the Niger Delta that will substantially increase Nigerian reserves and daily production. The first of the deals, with US major Chevron Corp., is for development of two offshore oil blocks OMLs 91 and 91 and is expected to add 211 million barrels of oil and 1.9 Tcf of gas to Nigerian reserves, and potential output of 30,000 b/d of oil equivalent, the NNPC added. The second agreement was signed with the Shell, Total and Eni joint venture partnership for the development of several onshore and offshore oil fields that had long been delayed due to a lack of funds. “The deal (Project Santolina) is for an accelerated upstream production comprising of 156 development activities across 12 OMLs and 30 fields in the Niger Delta,” NNPC said. Lack […]

Nigeria: Security Still a Challenge in Niger Delta – Shell

2 Aug 2017   Nigeria

Shell Petroleum Development Company has disclosed that its operation is still threatened by insecurity in the Niger Delta. The company indicated in its latest report that crude oil theft, sabotage and related damage to oil and gas facilities continue to present significant security concerns in parts of the Niger Delta, as well as environmental damage, which is aggravated by the proliferation of illegal refineries in the area. It stated that illegal refining and third-party interference are the main sources of pollution in the Niger Delta today. According to the report, third-party interference is the cause of 90% of the number of spills of more than 100 kilograms from The Shell Petroleum Development Company of Nigeria Limited operated Joint Venture (SPDC JV) pipelines in 2016. It stated that security in parts of the Niger Delta remains a major concern with persisting incidents of criminality, vandalism, threats from self-described militant groups, […]

Nigeria: Government Vows to Halt Oil Production If Cost Remains High

2 Aug 2017   Nigeria

International Oil Companies (IOCs) and their indigenous counterparts may soon be forced to halt operation, as the cost of producing a barrel of crude oil remains high. The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, says there is no way the country can keep producing, while the prices of crude remain low. The minister said that the oil sector has suffered infrastructural deficit of over $15 billion (N4.59 trillion) as many investment has been put on hold due to the low oil prices. At an international conference and exhibition organised by the Society of Petroleum Engineers in Lagos, he said it is better for Nigeria to stop crude oil production than to produce at a high cost. The minister said that government is compelled to work towards drastic reduction of cost of production because “there is no way this country will produce oil at this sort of […]

Nigeria: 3 Yrs of Low Oil Price and Nigeria’s Struggle for Survival

2 Aug 2017   Nigeria

After trading at over U.S.$100 per barrel for some years, the price of oil began to tomble down around July, 2014, falling to below U.S.$30 per barrel. The collapse of the price of crude created serious economic crisis for oil-reliant countries, including Nigeria. It was not unexpected that Nigeria became one of the countries most affected by the downturn. Central to the economic crisis that would later befall the country was her over reliance on oil. Oil accounts for 69 per cent of exports, according to the National Bureau of Statistics (NBS) and around 70 per cent of government revenue. The impact started to be felt at the most unfavourable period, at the crucial time a new administration had just come into office. The slump in crude prices, Nigeria’s mainstay, hammered the country’s earnings, leading to a significant decline in the country’s foreign reserves and a free fall of […]

Nigeria: Boko Haram Attack On Nigeria Oil Team Killed Over 50

31 Jul 2017   Nigeria

More than 50 people were killed in a Boko Haram ambush on an oil exploration team in northeast Nigeria earlier this week, multiple sources told AFP news agency on Thursday, warning the death toll could rise. Tuesday’s attack in the Magumeri area of Borno state on a convoy of specialists from the Nigerian National Petroleum Corporation (NNPC) was the group’s deadliest in months. It underscored the persistent threat posed by Boko Haram fighters, despite government claims they were a spent force, and also the risks associated with the hunt for crude in the volatile Lake Chad basin. Details of the ambush, which was initially thought to be a kidnapping attempt, have been slow to emerge and an exact death toll difficult to establish, as the military strictly controls access to rural Borno. Telecommunications and other infrastructure have been severely damaged or destroyed in the conflict, which has left at […]

Nigerian media reports halt to some crude oil production

28 Jul 2017   Nigeria

Nigerian media reported Thursday the federal government opted to halt crude oil exploration in part of the Niger Delta because of heightened security concerns. Militants struck a crude oil pipeline in Nigeria early this week , sidelining more than 100,000 barrels of oil per day. On Wednesday, militants abducted dozens of oil contractors working for the Nigerian National Petroleum Corp., though security forces were said to have conducted a successful rescue mission. Nigerian news service This Day reports nine soldiers and one civilian were killed during the operation. Nigeria is a member of the Organization of Petroleum Exporting Countries, but is exempt from a multilateral agreement to stem production because it needs oil revenue to fund national security efforts. Improvements late […]

Nigeria To Shake Off The Shackles Of Oil

27 Jul 2017   Nigeria

Nigeria is now saying that “era of oil booms” may be over—for good. According to its national petroleum policy approved this week by the federal executive council, the country plans to cut its oil exploration costs and move away from reliance on revenues from crude oil exports. Its expectations are that oil prices will hover near $45 per barrel “for the foreseeable future”, necessitating a shift towards diversifying its economy and develop its own refining and petrochemical sectors. “The most realistic line of action for any nation with oil as the backbone of its economy is to diversify, because indices strongly point to the possibility that the era of oil booms may be over for good”, said the policy . In accordance with this 112-page policy document, the other aim of Africa’s second biggest oil producer is to reduce the cost of extracting oil, which now stands at $29 […]

Militants hit Nigerian crude oil pipeline

26 Jul 2017   Nigeria

Nigerian crude oil production was lowered following a militant tank on an oil pipeline, the state oil company said. File photo by vanhurck/Shutterstock July 25 (UPI) — A militant attack on a crude oil pipeline in Nigeria has sidelined more than 100,000 barrels of oil per day, the head of a state oil company announced. Maikanit Baru, the head of the Nigerian National Petroleum Corp., said as-yet identified saboteurs caused a breach on a major transit artery, curbing 150,000 barrels of oil per day. The rupture from the Trans-Niger pipeline came as parties to a committee monitoring a production agreement coordinated by the Organization of Petroleum Exporting Countries, of which Nigeria is a member, met to consider its impacts. Baru said the problem at the pipeline created obstacles to sustaining what he said was the 2.2 million barrels of crude oil production per day reached last week. “Unfortunately, we […]

Nigeria Oil Thieves Keep a Lid on Output Even as Bombs Abate

21 Jul 2017   Nigeria

The continual disruption blighting the impoverished delta region threatens plans to exceed 2 million barrels a day, according to Wood Mackenzie. (Bloomberg) — The Agbada 2 flow station should have been buzzing with activity, pumping crude to one of Nigeria’s largest export terminals. Instead it was idle in the muggy, mid-morning heat as Wilcox Emmanuel, the facility’s manager, shrugged in resignation about the thieves who’d shut him down. As much as 30 percent of the oil sent by pipelines through the swampy Niger River delta is stolen, consultant Wood Mackenzie Ltd. estimates. That’s depriving the country of income amid a crippling recession and compounding the pain of a global price slump for Africa’s largest producer. At Agbada, the wells dotting the surrounding forests had been closed for three weeks following a pipeline leak that was probably deliberate. “Who knows when we’ll be back up?” Emmanuel said. The 60,000-barrel-a-day flow […]

U.S. seeks to recover $144 million in Nigeria oil industry bribery case

15 Jul 2017   Nigeria

The U.S. Justice Department on Friday filed a civil complaint seeking to recover about $144 million in assets obtained through paying bribes to a former Nigerian oil minister, the department said in a statement. The complaint said that from 2011 to 2015 two Nigerian businessmen conspired with others to pay bribes to the minister, Diezani Alison-Madueke, who steered lucrative oil contracts to companies owned by them. The proceeds were laundered in and through the United States, and were used to purchase assets including a $50 million Manhattan condominium and an $80 million yacht, it said. Alison-Madueke was charged with money laundering in Nigeria, the country’s financial crimes agency said in April. She previously denied to Reuters any wrongdoing when questioned about missing public funds and corruption allegations.

Libya gains balance Nigerian oil loss

15 Jul 2017   Libya, Nigeria, OPEC

Officials from a state oil company in Libya brief representatives from Norwegian energy company Statoil about the potential to bring production back to normal levels. Photo courtesy of the Libyan National Oil Corp. July 14 (UPI) — Disruption to Nigerian oil exports is offset by production gains from Libya, which is on pace to add another 100,000 barrels per day to the market, a market report found. Nigeria and Libya are two members of the Organization of Petroleum Exporting Countries exempt from a multilateral effort to balance the market with production declines so they can steer oil revenue to national security efforts. Since the deal was implemented in January, both countries have stabilized somewhat and in part undermined the broader OPEC-led effort. OPEC economists in their monthly market report for July said that, combined, Nigeria and Libya were adding about a quarter million barrels of oil per day to […]

Shell Nigeria Declares Force Majeure On Nigerian Light Oil Exports

15 Jul 2017   Nigeria

Shell’s Nigerian unit declared a force majeure on Bonny Light crude oil exports effective 12:00 local time on Thursday, just two weeks after it had lifted a previous force majeure on exports of the grade. According to Shell Petroleum Development Company of Nigeria Ltd, as quoted by Reuters, the force majeure was declared after Aiteo, the operator of the Nembe Creek Trunk Line—one of two pipelines that export the Bonny Light grade—shut down the line. On June 30, a Shell spokesman told Platts that the company had lifted a force majeure on Bonny Light exports on June 28. That force majeure was declared on June 8 after the other export pipeline, Trans Niger Pipeline, was shut down following a sabotage attack by oil thieves. The grade was exported, but cargoes were delayed by around 10 days. Exports of Bonny Light in June were planned at 203,000 bpd . The […]

Capping Libya, Nigeria Output Won’t Help Erase The Glut

14 Jul 2017   Libya, Nigeria, OPEC

The steady recovery of oil production in Libya and Nigeria in recent months has prompted OPEC to consider limiting the output of the two African producers that are currently exempt from cuts in the deal. The Joint OPEC-Non-OPEC Ministerial Monitoring Committee (JMMC) is gathering in Russia on July 24, and has invited Nigeria and Libya to attend to discuss their current production and short-term plans. According to Kuwait’s Oil Minister Issam Almarzooq, OPEC might ask the two nations to cap output as soon as possible. Talk of Libya and Nigeria possibly capping crude production has had little effect on the market, and analysts doubt that a limit would be lower than the current production of the two countries. Observers think that the two producers would agree to cap output when they reach their short-term production targets, which is 1.25 million bpd for Libya and 1.8 million bpd for Nigeria. […]

Nigeria to put off deciding whether to join OPEC cuts, minister says

13 Jul 2017   Nigeria, OPEC

Nigeria supports OPEC’s efforts to stabilize oil prices, but it wants to wait before deciding whether join the cartel’s cuts in oil production, its oil minister said on Wednesday. “Hopefully, in the next two to three months we can see how predictable the production return has been and then can say we feel stabilized and need to make the corresponding cuts,” Emmanuel Ibe Kachikwu told reporters. Nigeria and Libya, whose output has been hit by political turmoil and attacks, are exempt from an the Organization of Petroleum Exporting Countries agreement, which is an effort to reduce a glut of crude oil on world markets. Nigeria’s benchmark level to join the OPEC cuts is production of 1.8 million barrels of crude a day. Its current output is around 1.7 million barrels a day, excluding condensates, Kachikwu said. Nigeria’s output had improved in recent months, after the government […]

More oil possible from Libya, Nigeria, a report finds

7 Jul 2017   Libya, Nigeria, OPEC

A report Thursday from oil pricing group Platts stated that more production is possible from OPEC members Libya and Nigeria, adding to supply-side concerns. A survey of production from members of the Organization of Petroleum Exporting Countries by Platts found total group production rose 220,000 barrels per day between May and June. Total production last month was a six-month high for OPEC. OPEC, with support from non-member state producers like Russia, is coordinating an effort to balance a lopsided market with managed production declines. Libya and Nigeria are exempt from the arrangement so they can support national security efforts with oil revenue. Platts reported that Libyan oil production in June was around 810,000 barrels per day for its highest level in nearly […]

Nigeria Only Oil Producing Country Struggling With Importation of Refined Products – Kachikwu

30 Jun 2017   Nigeria

Minister of State for Petroleum Resources, Ibe Kachikwu Wednesday stated that the present oil that has remained the main stay of the nation’s economy may not last beyond 39 years. The Minister also lamented that Nigeria remained the only oil producing country still struggling with the importation of refined petroleum products. Speaking at the 5th Triennial National Delegates Conference of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN in Abuja Kachukwu described as embarrassing the country’s inability to refine oil in the country. Predicting the future of oil in the country, he said the nation’s future lies in the area of gas, saying at best, the nation’s oil reserve will last for another 25 to 39 years, while the nation’s gas reserve will last for over 60 years. According to him, “For me, the whole idea of continuing importation of petroleum products in this country is […]

Nigeria Near 40-Billion-Barrel Oil Reserves Target

30 Jun 2017   Nigeria

The plan by the Nigerian National Petroleum Corporation (NNPC) to grow the nation’s crude oil reserves to 40 billion barrels by the year 2020 received a major boost yesterday with the execution of a tripartite agreement in Abuja. The agreement was between the NNPC/FIRST Exploration & Production Joint Venture and Schlumberger for the development of the Anyalu and Madu fields in the Niger Delta under Oil Mining Licence, OML 83 and OML 85, offshore Nigeria. Under the agreement, Schlumberger would provide the over $700 million development cost of the Anyala and Madu fields which would generate 193 million barrels of crude oil into the current reserves of 37.2billion barrels and an additional 800 billion cubic feet of gas into the nation’s proven gas reserves which currently stand at 197 Trillion Cubic feet of gas. In terms of daily production, the fields will yield 50, 000 barrels of crude oil […]

Nigeria: Neiti – Over U.S.$21.8 Billion Unaccounted for By NNPC

24 Jun 2017   Nigeria

The Nigeria Extractive Industries Transparency Initiative (NEITI) has revealed that the Nigeria National Petroleum Corporation (NNPC) is supposed to remit over $21.8 billion billions to the Federation Account. The agency’s Director of Communications, Orji Ogbonnaya Orji, on spoke thursday on ARISE Television, a THISDAY sister broadcast station, said the discovery came as a result of the audited account of the NNPC. He explained that the unremitted amount was a combination of monies earned by the NNPC and all its subsidiaries from several projects executed in the oil sector in the past few years, but were not remitted to the federation account. He further said the agency’s report had been made known to the Acting President, Prof. Yemi Osinbajo, who was impressed with its findings. He said the agency discovered that the money was earned but not remitted to the Federation Account. He added that such unremitted money could be […]

Nigerian Crude Exports to Hit 17-Month High in August

23 Jun 2017   Nigeria

Nigerian crude exports will top 2 million barrels per day in August, reaching a 17-month high, according to new data compiled by Reuters on Thursday. Attacks by militants in the Niger Delta had crippled production in 2016, but the African nation has been rebuilding output steadily through 2017. Drops in output last year were so bad that OPEC exempted Abuja from the bloc’s November deal to cut production by 1.2 million barrels per day. The new rise in exports can partially be attributed to delayed shipments from July, Reuters said. An estimated 2.02 million bpd of Nigerian crude will leave ports on 67 tankers in August, along with another 97,000 bpd of condensates. The Forcados crude grade began loading again earlier this month, when Royal Dutch Shell lifted a force majeure on facilities related to the grade. A total of 10.3 million barrels of Forcados crude will be shipped […]

Once Again, Tensions Are Rising In Nigeria’s Oil Sector

23 Jun 2017   Nigeria

On 2nd May 2017, Nigeria’s House of Representatives rejected a motion requesting that the House compel international oil companies (IOCs) to relocate their headquarters to the Niger Delta. The initiative initially emerged in March 2017, when then-acting President Yemi Osinbajo disclosed that the government was considering the move as part of a wider effort to restore peace to the oil-rich region, which has suffered from decades of ethnic and political unrest. Despite over half a century of oil production in the Niger Delta – which holds 95 percent of the country’s oil reserves – Nigeria’s key oil-producing region has remained subject to extensive corruption and severe underinvestment. The Niger Delta region consists of nine states: Edo, Delta, Bayelsa, Rivers, Akwa Ibom, Cross River, Ondo, Abia and Imo, but the majority of oil production is focused in Bayelsa, Rivers and Delta states. Due to endemic government corruption, and economic mismanagement, […]

Nigeria’s cut exemption at risk from oil revival

23 Jun 2017   Nigeria

Upward production trend could be maintained Producer faces joining OPEC pact as output recovers August exports seen surging to 18-month high Security situation fragile despite fall in attacks Nigerian oil output has recovered to its highest level in more than a year as militant attacks have declined substantially, along with the return of key export grade Forcados. Including crude and condensate, output from OPEC’s biggest African producer plummeted to near 30-year lows of around 1.2 million b/d in 2016, from 2.2 million b/d previously, as attacks on oil facilities in the Niger Delta rose at an alarming pace due to resurgent militancy. But Nigerian crude oil production in May jumped to 1.73 million b/d, up 80,000 b/d from April, its highest level since March 2016, according to the most recent S&P Global Platts OPEC survey. Since then, the Forcados restart has boosted flows and production is expected to increase […]

Nigeria: Militants Give Northerners October 1 to Quit Niger Delta

17 Jun 2017   Nigeria

A coalition of Niger Delta militant groups rose from a meeting in Port Harcourt, Rivers State yesterday ordering all northerners to quit the oil-rich region. The militants threatened to attack all oil wells owned by northerners in Niger Delta before October 1, 2017. The groups, under the aegis of the Coalition of Niger Delta Agitators, berated the Acting President, Yemi Osinbajo, Inspector General of Police, Department of State Services and the Army for not arresting those who issued an ultimatum to Igbo to leave the north. This development has stoked the tension that is threatening to tear the nation apart. The government which has initiated a peace process may have to increase its parleys with stakeholders to avert the threats to the Nigerian union. At the joint meeting between the Coalition of Niger Delta Agitators and youth leaders across the region to review […]

Nigeria: Oil Output Hits Over 2.0m BPD As Shell Lifts Force Majeure On Forcados

13 Jun 2017   Nigeria

Shell Petroleum Development Company Limited has officially lifted force majeure on exports of Nigeria’s Forcados crude oil, thus increasing the nation’s oil output by additional 200,000 barrels per day. Force majeure is a legal declaration, meaning that the operator cannot fulfil a contract due to circumstances outside its control in order escape any liability. Consequently, the nation’s total production increased from two million bpd to about 2.2. million bpd, the highest in 16 months. Investigations showed that the Organisation of the Petroleum Exporting Countries, OPEC has started monitoring developments in the nation in order to see the possibility of including Nigeria in its oil output cut before the end of 2017. Nigeria and Libya were excluded from the cut in May when the organisation met in Vienna, Austria to adopt an action towards achieving stability in the volatile market. At the end of the meeting, OPEC had indicated in […]

Nigeria To Return 20% Of OPEC Cuts To The Market

12 Jun 2017   Nigeria

Shell lifts force majeure on Forcados oil in Nigeria Royal Dutch Shell (ticker: RDSA) lifted force majeure on exports of Nigeria’s Forcados oil grade, returning about 250 MBOPD to world markets, according to shipment data obtained by Bloomberg . Europe’s largest oil company placed the crude grade under force majeure – meaning the company could miss contractual obligations due to circumstances outside of its control – more than a year ago after repeated attacks on infrastructure by the Niger Delta Avengers (NDA). The NDA militia attacked a number of oil and gas pipelines in Nigeria in an attempt to undermine the presidential administration. The attacks dropped the country’s oil output by 1 MMBOPD to just 0.8 MMBOPD in June of last year. Ready to put about 20 percent of the OPEC cut production back into global oil supply The persistent attacks on the country’s oil and gas industry were […]

Nigerian crude oil exports threaten market balance

9 Jun 2017   Nigeria, Oil Supply

The resumption of operations at a crude oil export terminal in Nigeria could lead to stronger output from the OPEC member, industry analysts say. File photo by Pavel Shlykov/Shutterstock June 7 (UPI) — Oil export operations in Nigeria are back in service following repairs, a division of Royal Dutch Shell said, adding to lingering supply-side concerns. A spokesperson for the Shell Petroleum Development Company of Nigeria Ltd said the company lifted force majeure, a contractual condition related to circumstances beyond the control of the parties involved, for exports from the Forcados terminal in Nigeria following repairs to an export artery. The spokesperson told UPI in response to emailed questions there were “three sabotage leaks” on the pipeline that were repaired with the help from federal authorities and the governments from the oil-rich Niger Delta states. Nigeria is a member of the Organization of Petroleum Exporting Countries, but is exempt […]

Nigeria: Shell Reopens Forcados Terminal for Crude Export

9 Jun 2017   Nigeria

The Shell Petroleum Development Company of Nigeria Ltd (SPDC) operator of the Shell/NNPC Joint Venture on Tuesday lifted the 17 months force majeure placed on Forcados Export Terminal following the completion of repairs of the leaks on the Trans Forcados Pipeline (TFP) that has affected crude receipts into Forcados Terminal. The spokesperson of Shell Nigeria, Bamidele Odugbesan who confirmed the development to LEADERSHIP in a telephone chat said the force majeure was lifted effective 16.00hour (4.00pm local time) on Tuesday, June 6, 2017. He commended the government and securities agencies for their supports in ensuring the repairs of the pipelines stressing that the reopening of the crude export terminal will further improve the prospect of meeting the 2.2 million barrel per day (bpd) export target of the government. According to Bloomberg’s loading program, Nigeria’s crude shipment this month is expected to average about 250,000 bpd, adding that the extra […]

Nigeria: Militants Threaten to Resume Bombing of Oil Facilities in Delta

9 Jun 2017   Nigeria

Warri — A militant group, New Delta Avengers, yesterday vowed to resume disruption of oil exploration activities in Delta State. The militants declared “Operation Cripple Oil and Gas Production’ saying they would use any means available to achieve their aim. Spokesman of the group, Cpl Oleum Bellum, said they were putting the Federal Government and oil companies – local and multinationals – operating in the state on notice that effective from midnight June 30, 2017 there should be no more oil and gas operations in Delta. They warned that those who try their resolve would be made a scape goat.A statement issued yesterday by members of the group who claimed to be ex-militants reads: “From the oil producing parts of Delta State, this morning, June the 6th 2017, converge in Delta State, we have agreed to resume attacks on oil facilities, resurrect the spirit of insurgency and to make […]

Nigeria’s Oil Theft Epidemic

7 Jun 2017   Nigeria

Although crude oil theft has long been the subject of intense media attention in Nigeria, the downstream theft of hydrocarbons has remained under the radar. Despite this, downstream hydrocarbon theft is big business in Nigeria, Africa’s largest oil producer. In 2015, the petroleum sector accounted for approximately 51 percent of the federal government’s income and more than 90 percent of export earnings. According U.S. Department of Commerce data published in February 2017, it also accounted for between 10-12 percent of Nigeria’s GDP. As global oil prices rose above $100 a barrel in the early 2000s, the theft of oil became a very lucrative business. Furthermore, due to a conspicuous lack of youth employment in the region, many of the Niger Delta indigenes (particularly young men) have turned to the illicit hydrocarbon trade (i.e. small-scale tapping of crude oil, petroleum theft / smuggling and artisanal refining) as a source of […]

Nigeria’s Forcados Oil Comes Back in Fresh Blow to OPEC Curbs

7 Jun 2017   Nigeria

Nigerian stream back after 15-month halt caused by sabotage Extra barrels equate to about a fifth of OPEC supply curbs Royal Dutch Shell Plc lifted restrictions on exports of a key Nigerian crude oil, 472 days after imposing them following militant attacks. The extra flows alone amount to about 20 percent of the supply OPEC has pledged to cut from world markets. Europe’s biggest oil company ended a force majeure of Forcados crude oil shipments at 4 p.m. on Tuesday, a spokesman said. The measure, which allows companies to miss contractual obligations, was imposed on Feb. 21 last year. Shipments this month will average about 250,000 barrels a day, according to a loading program obtained by Bloomberg. Graphic: Tracking OPEC’s Production Cuts Nigeria is adding barrels to the market just as other members of the Organization of Petroleum Exporting Countries are trying to remove them in a bid to […]

Nigeria Suspends Port Harcourt Refinery Concession On Transparency Grounds

31 May 2017   Nigeria

The Nigerian Senate approved on a motion to suspend a concession agreement for the Port Harcourt refinery with a subsidiary of Eni on Tuesday because the deal allegedly lacked transparency. The agreement would have allowed the Italian company’s local unit to repair and operate the 150,000-barrel-per-day facility. Eni had begun negotiations to form a partnership with the Nigerian oil firm Oando for the project, which would have allowed Lagos to reduce its dependency on imported refined oil. The Senate will now investigate the terms of the contract through a special ad hoc committee. Eni did not respond to a request for comment by Reuters. The Nigerian National Petroleum Corporation (NNPC) had been accepting bids for the upgrade of three refineries—Port Harcourt, Warri, and Kaduna—until February 2nd. General Electric had also expressed its interest in being a part of the government’s rehabilitation initiative, which will save Lagos from spending millions […]

Nigeria Secures Second Exclusion From Opec Output Freeze

29 May 2017   Nigeria

Nigeria again got members of the Organisation of Petroleum Exporting Countries (OPEC) and its other non-producers allies led by the Russian Federation, to exempt it from limiting the volume of oil it can produce from its oil fields within the extended production freeze agreement they reached at their second meeting in Austria, the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, has disclosed. This is just as the Nigeria Extractive Industries Transparency Initiative (NEITI) applauded the passage of the Petroleum Industry Governance Bill (PIGB) by the Senate, and thus asked members of the House of Representatives to find similar courage employed by the senators, to accelerate the passage of its own version of the bill. Kachikwu, stated that the country and Libya, were exempted from the output freeze despite speculations they would be made to participate in the extended agreement. He however noted the country was […]

Nigeria: No Pipeline Vandalism Recorded in Three Months – Nigerian Govt

6 May 2017   Nigeria

The Nigerian government, Wednesday, said it has witnessed no pipeline vandalism arising from militant activities in the Niger Delta in the past three months. The Minister of State for Petroleum Resources, Ibe Kachikwu, made this known at the ongoing Oil Technology Conference 2017 holding in Houston, Texas, United States. A statement by the Director of Press in the Ministry of Petroleum Resources, Idang Alibi, stated that the near zero rupturing of pipelines in the oil rich region was mainly due to the consultations and ongoing discussions with Niger Delta stakeholders. According to the statement, pursuing peace, security and stability in the Niger Delta was an integral aspect of the implementation of the ministry’s target for the year. Mr. Kachikwu had announced in 2016 that the government was working hard to record no vandalism of oil pipelines in 2017. He also explained that there were efforts to substantially reduce youth […]

Nigeria: NEITI Begins Audit of Oil Companies, Govt’s Revenues in 2015, 2016

2 May 2017   Nigeria

The Nigeria Extractive Industries Transparency Initiative (NEITI) has disclosed that it has started the processes of a comprehensive independent audit of the oil and gas sector, as well as revenues earned by Nigeria in the sector in 2015 and 2016. NEITI stated in a statement, which was made available to THISDAY in Abuja that the independent audit would be conducted in line with the principles and standards of the global Extractive Industries Transparency Initiative (EITI). NEITI said its Executive Secretary, Mr. Waziri Adio, disclosed this in Lagos at a workshop for major oil companies and relevant government agencies expected to participate in the exercise. Adio, the statement added, explained that the workshop was designed to acquaint the participants with the structure and content of the template, the kinds of questions that NEITI would ask and the answers expected to be provided by the covered entities. “This workshop […]

Nigeria Seizes Foreign Vessel for Alleged Theft of Shell Crude

27 Apr 2017   Nigeria

Nigeria detained a vessel with crew members from countries including Pakistan, Indonesia and Ukraine for alleged theft of crude from a facility owned by Royal Dutch Shell Plc, the navy said. The tanker, MT TECNE, was apprehended before dawn on April 25 while loading crude from the Afremo platform operated by Shell’s Nigerian unit, Ibrahim Dewu, a navy spokesman, said Wednesday by phone from the southern city of Warri. “They had siphoned about 2,000 metric tons of crude oil from the loading jacket before their arrest,” he said. A Nigerian, three Ghanaians and a Benin national were among the crew arrested, he said. Organized criminal gangs have for years stolen crude from pipelines and facilities in the Niger River delta, home to the country’s oil industry, either for sale to vessels waiting offshore or for local refining. Nigeria’s Petroleum Ministry estimates that sometimes as much as 10 percent of […]

Nigeria: Malabu Scandal – Group Wants Nigerian Govt Involved in Italian Trial

26 Apr 2017   Nigeria

The Human and Environmental Development Agenda, HEDA Resource Centre, has petitioned Vice President Yemi Osinbajo, requesting the representation of Nigeria as an aggrieved party in the hearing of the Milan Court’s prosecution of Shell and ENI with respect to the scandalous Malabu deal. In a petition addressed to Mr. Osinbajo, who also doubles as the Chairman Asset Recovery Committee, HEDA in the petition signed by its chairman, Olanrewaju Suraju, urged the federal government to request that the Italian court judge should recognize Nigeria as a civil party to the criminal proceeding in order to request adequate compensation for the damages received by the corruption scheme. “The media was awash about six years ago with information on how one of Nigeria’s richest oil field, OPL 245 was sold in shady circumstances and more than half of the $1.1 Billion paid to Malabu Oil and Gas for the procurement was used […]

Nigeria Said to Let Market Set Naira Rate on Exchange Window

25 Apr 2017   Nigeria

Central bank Governor Emefiele said to tolerate naira dropping Naira forward contracts jump to highest levels since March Nigeria’s central bank will let the market determine the naira’s rate in a new foreign-exchange window for portfolio investors as the nation struggles to revive its economy amid a dollar shortage. Naira forward contracts and banking stocks rose. Governor Godwin Emefiele told senior bankers that he would tolerate the naira weakening in the window, which started today, according to a person who attended meetings with the policy maker over the past two weeks. While that may cause the currency to depreciate to its black-market level, the central bank probably won’t devalue the interbank exchange rate, the person said, declining to be identified because he wasn’t authorized to speak publicly. Isaac Okorafor, a spokesman for the central bank, didn’t answer calls to his mobile or immediately respond to a text message. Nigeria […]

Africa: Two Oil Giants Could Face Trial in Italy Over Nigerian Deal

21 Apr 2017   Nigeria

This Thursday a Milan court is to decide whether to go ahead with criminal proceedings against the oil giant Shell and its Italian partner ENI in connection with the purchase of the rights to a Nigerian oil field. “Etete can smell the money. If, at 70 years old, he does turn his nose up at 1.2 bilion he is completely certifiable.” That’s a quote from a confidential email which is embarrassing the oil giant Shell. For years, Shell had strenuously denied that it knew anything about the involvement of convicted money launderer and former Nigerian oil minister Dan Etete in its purchase of the rights to one of Nigeria’s biggest oil fields. But last week, the British environmentalist and anti-corruption organization, Global Witness, published confidential emails written by a Shell employee. This correspondence, which went right to the top of the Shell management hierarchy, proves that there was a […]

Nigeria: Nowhere to Hide – Prosecutors Turn Up the Heat On Oil Execs At Heart of Corruption Scandal

21 Apr 2017   Nigeria

The latest developments in a multi-billion dollar corruption scandal show how the net is closing in on oil bosses who allow shady deals to happen on their watch – and how vital global transparency rules that make such deals much harder must be upheld. Last month, we celebrated a huge victory for the people of Nigeria when news broke that the Nigerian government seized a valuable block OPL 245 from oil giants Shell and Eni. The move followed years of investigations by Global Witness and our partners into the companies’ backroom deals and undisclosed payments that led to them getting hold of the lucrative block. This was truly historic news in itself – but it’s just the start of the story. Developments are occurring thick and fast as the heat is turned up on the individuals at the centre of the scandal. On Thursday, Italian authorities requested that Shell, […]

Nigeria to Restore Oil Output Even as OPEC Weighs Extending Cuts

14 Apr 2017   Nigeria

Bonga, Forcados facilities will restart by July after work OPEC must extend cutbacks to keep prices above $50 a barrel Nigeria will revive oil production this summer as it completes maintenance and repairs, and expects fellow OPEC members to continue to cut their output in the second half of the year, Oil Minister Emmanuel Kachikwu said. Africa’s second-biggest producer will finish repairs on the Forcados pipeline by June and complete maintenance at the Bonga oilfield the following month, Kachikwu said in a Bloomberg Television interview. The country’s output slumped to 1.27 million barrels a day last month, the lowest in decades, according to data provided by the nation. It aims to reach 2.2 million barrels a day. Play VideoPlayMuteCurrent Time 0:00/Duration Time 0:00Loaded: 0%Progress: 0%Stream TypeLIVERemaining Time -0:00Playback Rate1 Chapters Chapters captions settings, opens captions settings dialog captions off, selected CaptionsFullscreen This is a modal window. No compatible source […]

Shell Knew Nigeria Ex-Minister’s Company Would Get Oil-Deal Cash

12 Apr 2017   Nigeria

Transaction under investigation amid allegations of corruption Company previously said it was unaware minister would be paid Royal Dutch Shell Plc said it knew some of the $1.1 billion paid to the Nigerian government in 2011 for an exploration license would go to a company linked to the country’s former oil minister, changing its previous stance on a deal that’s under investigation for alleged corruption. The Anglo-Dutch oil company reiterated that its joint purchase with Eni SpA of the license was “fully legal” and it paid no money to Dan Etete or his company Malabu Oil and Gas Ltd. Following the publication of internal emails showing staff discussed the risk that funds from the transaction could ultimately be used to pay off officials, Shell acknowledged on Tuesday that it was aware of the former minister’s involvement. “We knew that the Federal Government of Nigeria would compensate Malabu to settle […]

Nigeria: Malabu Scandal – Jonathan Must Have Gotten $200 Million, Middleman Tells FBI, Others

11 Apr 2017   Nigeria

Former President Goodluck Jonathan probably received as much as $200 million to approve the controversial $1.3 billion sale of OPL 245 oil field, Italian prosecutors said in court documents. The documents, which were extracts of a thorough investigation by Italian authorities into the deal, also confirmed that Shell and ENI knew a good chunk of the $1.3 billion will be disbursed as kickbacks to Nigerian politicians, yet went ahead with the deal. The findings were obtained by BuzzFeed and Italian business newspaper, Il Sole 24 Ore. BuzzFeed released its own version earlier today. The prosecutors quoted Ednan Agaev, a Russian middleman who helped negotiate the transfer of the oil block to Shell and Eni, as saying that Dan Etete, the former Petroleum Minister at the heart of the oil scandal, said he intended to dole out as much as $400 million in bribes if the deal went through. If […]

Nigeria: Malabu Scandal – After Telling Lies for Years, Shell Admits It Knew Etete Would Benefit From $1.1 Billion

11 Apr 2017   Nigeria

After repeated denials in various countries, Anglo-Dutch oil giant, Royal Dutch Shell, on Monday finally admitted it had foreknowledge that the $1.3 billion itself and ENI paid to Nigerian government for the OPL 245 oil block licence would ultimately be used to settle convicted former Minister of Petroleum, Dan Etete. “Over time, it became clear to us that Etete was involved in Malabu and that the only way to resolve the impasse through a negotiated settlement was to engage with Etete and Malabu, whether we liked it or not,” The New York Times quoted Andy Norman, a spokesperson for Shell, as saying in an email Monday. The Dutch oil giant knew the Nigerian government “would compensate Malabu to settle its claim on the block,” Mr. Norman added. The confession came a day after intercepted telephone conversation between Shell’s chief executive, Ben van Beurden, and his then chief financial officer, […]

Eni, Shell deny wrongdoing in Nigeria after allegations of improper payment

11 Apr 2017   Nigeria

Oil majors Royal Dutch Shell and Eni reiterated on Monday that neither they nor their personnel had been involved in any wrongdoing in Nigeria, including improper payments to Nigerian officials. The comments follow media reports alleging how hundreds of millions of dollars from the two companies were used for illicit payments. A joint investigation by BuzzFeed News and Italian newspaper Il Sole 24 Ore on Sunday claims to show transactions worth $1.3 billion made in 2010-2011 that Shell and Eni paid to acquire an exploration license for an offshore oil block known as OPL 245. The money was paid to the Nigerian government, but BuzzFeed and Il Sole said documents showed Shell’s top executives at the time knew those sums would go to Malabu Oil and Gas, […]

Niger Delta Diplomacy At Work: Oil Production Recovers In Nigeria

10 Apr 2017   Nigeria

Nigerian President Muhammadu Buhari’s nascent campaign to negotiate with separatists in the oil-rich Niger Delta has proven to be more effective in restoring oil output to pre-conflict highs than his previous all-out war tactic. “Despite the president’s initial threats and bluster on the delta, common sense now seems to be prevailing,” Cheta Nwanze, of Lagos-based head of research at SBM Intelligence, told World Oil this week. “The government needs steady oil production to stand any chance of a quick end to the economic recession.” It’s a numbers game, really. Oil output hit a low last August, with production falling to 1.4 million barrels per day, compared to the 2014-2015 average of 2 million bpd. Since Lagos declared that it had reached a truce with a consortium of militant groups in November, production has recovered to 1.68 million bpd. Only a single force majeure, a clause that allows production companies […]