Nigeria produces 2.19 mbpd, earns $20.9 billion from exports

September 27, 2013 | Earnings Reports, Economy

Nigeria NNPC Headquarters & Towers, Abuja

Nigeria NNPC Headquarters & Towers, Abuja

Lagos – Nigeria’s state-owned Nigerian National Petroleum Corporation (NNPC) has produced an average 2.19 million b/d of crude oil over January-July, and earned $20.9 billion from crude exports over the same period, according to NNPC’s Group Managing Director, Andrew Yakubu in a statement issued by the company late Thursday.

Output and revenue however, could have been higher if not for large-scale oil theft, pipeline vandalism and illegal bunkering in the Niger Delta region, which severely disrupted production and exports, he told lawmakers in Abuja, according to the statement.

“The projected budget revenues have not been realized due to significant production shortfall. The 2013 planned production was 2.45 million b/d [but] year-to-date July 2013 production has averaged 2.19 million b/d,” Yakubu said.

“Although oil prices have averaged $108/barrel, which is about $38/b above the budget benchmark, this has not led to improvement in government revenues due to production shortfall occasioned by crude theft and pipeline vandalism,” he added.

Andrew Yakubu went on to say that oil theft and illegal bunkering were rampant in onshore operations especially in the swamps and shallow waters of the Niger Delta.

“For instance we recorded over 170 vandalized points in the Escravos- Warri crude oil pipeline… a distance of 60 km,” he added.

Lawmakers from Nigeria’s lower legislative chamber, the House of Representatives had met with NNPC on Thursday over the continued decline in government revenue so far this year.

Oil is Nigeria’s economic mainstay, accounting for 80% of government revenue.

NNPC manages the government’s average 57% equity interest in upstream joint ventures with foreign firms including Shell, ExxonMobil, Chevron and Total, which together accounts for 90% of Nigeria’s more than 2 million b/d of oil output.

Government data released last week showed Nigeria’s gross revenue tumbled 42% month on month to $3.1 billion in July due to disruptions to production and exports.

Anglo-Dutch Shell ,  Nigeria’s biggest oil producer on Monday declared force majeure on exports of Nigeria’s major export crude grade, Bonny Light, as well as on gas supply to Nigeria’s 22 million mt/year Bonny LNG plant, after shutting its 150,000 b/d Trans Niger Pipeline for repairs to damage from the latest oil theft.

A report released last week by London-based Chatham House said Nigeria lost an estimated 100,000 b/d of oil to oil theft in the Niger Delta in the first quarter of this year, Nogtec  reported previously.