There appears to be no respite for the significantly oil-dependent
Nigerian economy as crude production slumped to a new low of
937,766 barrels per day in September.
It would be the first time since at least 1990 that Nigeria would be
producing that low quantity of the commodity from which the
country generates majority of its foreign exchange revenue.
Latest data released by the Nigerian Upstream Petroleum
Regulatory Commission (NUPRC) detailing production for last
month , showed that the fresh drilling figure was lower than the
one for August which was 972,394 barrels per day.
The information is coming days after THISDAY reported that
Nigeria lost as much as $800 million in earnings that could have
accrued to the federation to facilities’ shut-ins and equipment
failures in August.
Nigeria is dealing with unprecedented oil theft under the
Muhammadu Buhari administration, hobbling the country’s ability
to meet its Organisation of Petroleum Exporting Countries (OPEC)
quota in the last one year.
At the last Federation Account Allocation Committee (FAAC), a
Nigerian National Petroleum Company Limited (NNPC)
presentation indicated that as much as 8.14 million barrels of
crude oil were lost during the month of August.
The further decrease below the 1 million bpd mark in production in
September, despite months of assurances of planned
improvement by the Nigerian authorities, is more than 10 per cent
compared to the July 2022 production of 1.083 million barrels per
day.
THISDAY’s checks showed a steady deterioration in the country’s
production figures. It indicated that in June the country’s
production was 1.158 million bpd; it was 1.024 million bpd in May;
1.219 million bpd in April, 1.237 million bpd in March; 1.257 million
bpd in February and 1.398 million bpd in January.
The quota allocated to Nigeria by the Organisation of Petroleum
Exporting Countries (OPEC) to the country for the month of August
was 1.826 million barrels per day while in September it increased
to 1.830 million per day, meaning that Nigeria under-produced to
the tune of about almost 900,000 bpd last month.
This implies that Nigeria was only able to produce roughly half of
its entire production quota despite a recent rash of measures to
curtail the oil theft menace, which so far appears to have defied all
solutions.
A few of the measures include the renewed deployment of security
personnel in the Niger Delta and the real-time monitoring of
activities around the pipelines by the Nigerian National Petroleum
Company Limited (NNPC).
In addition, the national oil firm has introduced the whistle-blower
strategy as well as the handing over of a N4 billion monthly
surveillance contract to ex-militant, Government Ekpemupolo,
popularly known as Tompolo.
The federal government has variously blamed massive oil theft,
vandalism of major assets, dilapidated infrastructure as well as
declining upstream investment for its inability to drill more of the
commodity.
The Group Chief Executive Officer of the NNPC, Mallam Mele
Kyari, had recently called for the setting up of a special court to try
persons found to have been complicit in the vandalism of Nigeria’s
oil infrastructure.
The GCEO sought the High Court’s support towards the creation
of a special court/tribunal to ensure speedy trial of crude oil thieves
and pipeline vandals, the national oil firm stated.
Kyari, who described the actions as a serious threat to Nigeria’s
oil production, revenue generation and by extension energy
security, observed that a special court to execute such cases will
deter would-be criminals and assure investors of value for their
investments.
A few weeks ago, the Petroleum and Natural Gas Senior Staff
Association of Nigeria (PENGASSAN) threatened that oil workers
will withdraw their services should the government fail to take
decisive action against oil thieves.
“ This is affecting literally every single operator in the Niger Delta.
They are not producing and they have shut in operations because
anytime they pump in 10,000 barrels, through the pipelines, at
best, you are going to get about 1,000 barrels from the other end.
“ Over 95 per cent of this crude oil pumped into the pipeline are
vandalised. So because of that, majority of them have shut down
production and because of that, the welfare of our members is
threatened. The jobs of our members are threatened in the
production of oil,” Festus Osifo, head of the group lamented.
The NNPC has been unable to contribute a kobo to the federation
account since this year, thereby crippling most dollar-related
transactions in the Nigerian economy.
The scarcity of the greenback has also impacted negatively on the
value of the naira, with the local currency falling to as low as N730
in the parallel market in the last few months.
But in the last two weeks, the NNPC in collaboration with
government security personnel as well as local outfits have
uncovered tens of spots where Nigeria’s oil is tapped illegally and
transported to the high sea in the Niger Delta.
