Crude-oil-barrelsThe International Energy Agency (IEA) has confirmed the downward trend in Nigeria’s crude output for the third month running.

The agency’s Oil Market Report for the month of June, which was released at the weekend, showed that for the month of June, the nation’s oil export was down 70 kb/d to 1.88 mb/d.

“Damage to pipelines and other infrastructure stemming from oil theft is behind the drop in output. Key export crudes like Bonny Light have been under force majeure since April, affecting 150 kb/d. Total’s May 30 force majeure on liftings from the 180 kb/d Usan field also remains in place,” the agency said.

In an effort to reduce oil theft and pipeline damage that has led to an estimated annual loss of 60 kb/d and caused massive environmental problems, the nation’s largest producer Shell plans to invest $1.5 bn on a new pipeline. Shell was forced to close the Nembe Creek pipeline for repairs after discovering more than 50 break points along the near 100 km trunkline.

In 2010, Shell spent $1.1 bn to replace the Nembe Creek pipeline due to damage. The new pipeline, called the TransNiger Pipeline Loop-line, should help reduce oil spills in the Niger Delta because it will circumvent the Ogoniland region of Nigeria, where a large volume of bunkering and pipeline damage takes place.

On the other hand, IEA’s report showed that Angolan crude output rose by 20 kb/d to 1.78 mb/d in June, the agency said. Production at block 15 from the Kizomba D Satellite fields and Clochas Mavacola also increased output near nameplate capacity of 140 kb/d in June.

The report also showed that while Nigeria’s crude was trending downward, South Sudanese production is steadily increasing, and exports have begun. China imported 60 kb/d of the country’s exports in May. The Thar Jath field in Block 5A and the Palogue field in Block 3/7 are both producing. In early June Sudanese President Bashir ordered companies to shut down the export of South Sudanese crude within 60 days, accusing South Sudan of using oil revenues to “buy arms for rebels and mercenaries.”


Information from This Day was used in this report.