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Nigeria loses 79m barrels of crude to vandalism

The attacks on Forcados export line by militants in the Niger Delta have left a total of 79 million barrels of crude oil shut in since February, causing oil firms and the nation a huge loss of revenue.

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The Forcados export terminal was shut down after Shell Petroleum Development Company of Nigeria Limited declared force majeure – a legal clause that allows it to stop shipments without breaching contracts – on February 21.

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Militants had a week earlier blown up a pipeline feeding the Forcados export terminal, knocking out at least 250,000 barrels per day. Since then, the terminal has not come back on stream.

The Nigerian National Petroleum Corporation, in its latest monthly report, said crude oil production in Nigeria plummeted to 1.69 million bpd in May, following uptick in pipeline vandalism in the volatile Niger-Delta region.

The NNPC said, “The subsisting force majeure at Forcados terminal means that about 380,000 bopd remains shut-in. Cargoes were deferred until repairs are completed.

“Also, the nation has lost over 1,500 megawatts to the damage at Forcados, which accounted for 40 per cent to 50 per cent of gas production.”

The corporation noted that force majeure was declared on May 10 for repair work on Nembe Creek Trunk Line and the resultant shut-in of about 275,000bopd, adding that other far-reaching incidents included production shut-in at Usan, Que Iboe and Brass terminals.

It is still uncertain when the Forcados pipeline will come back on stream, although one of the companies hard hit by the shutdown expects the force majeure to be lifted later this month.

Seven Energy, an integrated gas company in the South-East with upstream oil and gas interests in the region, said it lifted no oil from the Mining Leases 4, 38 and 41 during the first half of the year due to the shutdown of the Forcados terminal and the declaration of force majeure by Shell from mid-February.

“Current expectations are that the force majeure will be lifted late in the third quarter of 2016,” the company said.

2 Comments on Nigeria loses 79m barrels of crude to vandalism

  1. God help this country…

    Like

  2. Such a disappointment. That money could have saved and changed so many lives.

    Like

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