Chika Amanze-Nwachuku
23 June 2009
Lagos — The Central Bank of Nigeria (CBN) yesterday confirmed a drop in Nigeria's crude oil export, owing to the rising violence in the oil-rich Niger Delta.
This is as indications have emerged that Nigeria may find it difficult to meet its implied Organisation of Petroleum Exporting Countries (OPEC) production quota of 1.67 million barrel per day (bpd), owing to recent shut-ins as a result of renewed unrest in the Niger Delta region.
The country's production level, which has hovered around 1.2 million barrels per day (bpd) since last month, THISDAY learnt, has dropped to about 1 million bpd, owing to the onslaught on oil facilities in the region in the last three weeks.
In its quarterly economic report released yesterday, the apex bank said crude oil exports were estimated at 1.23 million bpd during the period under review, down from 1.42 million in the preceding three months period.
The report said Nigeria's oil production, including condensates and natural gas liquids was estimated at 1.68 million bpd in the first quarter, compared to 1.87 million bpd in the preceding quarter.
Nigeria, a strong member of OPEC, THISDAY learnt, has been struggling to meet its output quota, which came into effect on January 1 this year, owing to the declining crude oil production.
Minister of State for Petroleum Resources, Mr. Odein Ajumogobia, told Reuters yesterday that at one point last month, production had dropped to between 1.2 million and 1.3 million, which is far below the implied OPEC quota.
The Minister, who confirmed that Nigeria's oil output was running at around 1.6 million barrels per day, broadly unchanged from before the latest unrest in the Niger Delta, declined to confirm the current production figure.
"I don't have any reports to the contrary. I would if it had changed significantly," Ajumogobia told Reuters when asked if output was still around 1.6 million bpd, excluding condensate - the level produced before the latest fighting began last week.
He said onshore production had been the worst affected in recent years, citing the case of Shell's facilities in the eastern part of the Niger Delta.
The Minister, however, confirmed that Shell has lost most of its production following recent attacks on its eastern operation.
"Shell has lost most of its production in the east ... The irony of it is that onshore is the cheapest location to produce and therefore the return on that investment is greater, but that is where we have most of the shut-in," he said.
But industry sources had told THISDAY that output level had further reduced to about 1 million bpd, owing to the renewed attacks.
They doubted the possibility of Nigeria meeting OPEC quota, in view of the current upsurge in violence, which has extended to other oil producing states.
Operators raise fears that except urgent steps are taken to stem the rising violence in the region, Nigeria's oil production may be brought down completely.
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Nigerian citizens should come out and demand CONSTITUTIONAL CHANGE TO ALLOW SEPARATE DEVELOPMENT OF EACH OF THE SIX GEO-POLITICAL DIVISIONS OF THE COUNTRY TO PUT AN END TO THE NIGER DELTA PROBLEMS AND ALLOW THE COUNTRY TO MOVE FORWARD.