Nigeria misplaced about N720bn in income because of the consecutive month-to-month decline in its crude oil manufacturing in February and March 2024, The PUNCH studies.
Additionally, the nation’s incapacity to ramp up manufacturing in these months made it to overlook its crude oil manufacturing benchmark within the 2024 price range.
Nigeria’s 2024 price range set a crude oil manufacturing benchmark of 1.78 million barrels per day. This determine contains condensate together with crude oil.
However knowledge obtained from the newest April 2024 Month-to-month Oil Market Report of the Organisation of Petroleum Exporting Nations confirmed that Nigeria’s crude oil manufacturing (excluding condensates) witnessed the second consecutive month-to-month decline because the starting of this yr, because it dropped to 1.231 million barrels per day in March.
OPEC acknowledged that crude oil manufacturing particulars which it obtained by direct communication from Nigeria confirmed that the nation pumped much less oil in March when in comparison with what was produced in February.
Information from the report indicated that Nigeria produced 1.322 million barrels per day of crude in February this yr, however this dropped to 1.231mbpd in March, representing a plunge of 91,000bpd.
The report additional acknowledged that the nation had produced 1.427mbpd of crude in January, however this was not sustained in February because it dropped in that month, whereas the southward oil manufacturing continued in March.
It was additional gathered from the Nigerian Upstream Petroleum Regulatory Fee in Abuja on Sunday that each crude oil and condensates manufacturing from Nigeria had but to achieve the benchmark within the 2024 price range.
Information from the NUPRC confirmed that in January, February and March, the full volumes of crude oil and condensates produced in Nigeria have been 1.643mbpd, 1.539mbpd and 1.438mbpd respectively. In keeping with studies, the 2024 price range benchmark for crude oil and condensates manufacturing is 1.78mbpd.
N720bn income lose
From OPEC’s knowledge, it was found that Nigeria misplaced 105,000 barrels of crude oil every day in February, when in comparison with the every day crude oil volumes produced within the previous month of January.
This interprets to a complete of three,045,000 barrels for all the 29 days within the month of February 2024.
The common change charge of america greenback in February 2024 was N1,383.9, whereas knowledge from Nation Financial system, a world web site that publishes crude oil costs, put the common value of Brent, the worldwide benchmark for crude, at $83.48/barrel in the identical month.
By dropping 3,045,000 barrels of crude in February, it implies that Nigeria misplaced $254.19m or N351.78bn in that month, going by the common change in February.
Additional evaluation of OPEC’s knowledge indicated that the nation misplaced 91,000 barrels per day in March, which quantities to a complete of two,821,000 barrels for the evaluate month.
The common value of Brent in March this yr was $85.41/barrel, whereas the common change charge in identical month was N1,528.3/$.
Since Nigeria misplaced 2,821,000 barrels of crude oil final month, it means the nation’s crude oil earnings dropped by $240.94m. This represents a income lack of N368.23bn based mostly on the common change charge in March.
Due to this fact the full quantity of crude oil misplaced throughout the two-month interval is 5,866,000 barrels, whereas the price of this crude, based mostly on the evaluation above, is N720bn.
FG explains
When contacted on Sunday to talk on what the federal government was doing to sort out the plunge in crude oil manufacturing, Nneamaka Okafor, Particular Assistant on Media and Communications to the Minister of State for Petroleum Sources (Oil), Heineken Lokpobiri, referred our correspondent to the assertion of her boss that was issued on Friday.
“The minister defined the explanation within the assertion that was issued on Friday and that has not modified,” she acknowledged.
Lokpobiri had defined on Friday that the drop in Nigeria’s crude oil manufacturing was as a result of points encountered on the Trans Niger Pipeline, coupled with upkeep actions carried out by some oil firms working throughout the nation.
He, nevertheless, acknowledged that efforts have been on to repair the pipeline, including that this might allow the nation produce as much as 1.7 million barrels per day of crude oil and condensates.
The Trans Niger Pipeline is a serious oil pipeline in Nigeria that transports crude oil extracted from oil fields in Rivers and Bayelsa states to the Bonny Crude Oil Export Terminal.
It’s operated by Shell Petroleum Growth Firm Joint Enterprise, with a capability of about 180,000 barrels of crude oil per day, which is about 15 per cent of Nigeria’s every day output.
The Trans Niger Pipeline is a crucial a part of Nigeria’s oil infrastructure, however it has confronted important challenges lately.
Lokpobiri acknowledged that the drop in manufacturing was as a result of points encountered on the Trans Niger Pipeline, based on the assertion issued in Abuja by his media aide.
The assertion learn partially, “In response to latest considerations relating to a shortfall in oil manufacturing in Nigeria throughout the first quarter of 2024, The Minister of State for Petroleum Useful resource (Oil), Senator Heineken Lokpobiri, assures (Nigerians) that measures are being taken to deal with the scenario to, not solely restore manufacturing to earlier ranges, however to additionally improve it.
“The minister clarifies that the reported manufacturing shortfall was primarily as a result of points encountered on the Trans Niger Pipeline, coupled with upkeep actions carried out by some oil firms working in Nigeria.
“The minister can be happy to announce that the problems have been adequately addressed, and manufacturing is predicted to return to its earlier ranges within the coming days.”
Oil theft and pipeline vandalism have dealt extreme blows on Nigeria’s oil manufacturing, limiting the nation’s output and making it fall beneath the amount authorised for Nigeria by OPEC.
Lokpobiri had additionally acknowledged that he anticipated that “Nigeria’s oil manufacturing, together with condensate, which was roughly 1.7 million barrels per day prior to those developments, will quickly be restored.”
He additionally acknowledged that the Federal Ministry of Petroleum Sources was actively engaged in coverage evolution geared toward maximising the utilisation of all out there wells in Nigeria.
“This strategic method will allow the nation to ramp up manufacturing, thereby producing very important income to stabilise the nation’s international change reserves.
“The elevated income can even empower the federal government to meet its commitments in offering important infrastructure, as outlined within the 2024 price range,” the assertion acknowledged.
