Shell Nigeria Exploration and Production Company (SNEPCo) halted production at Nigeria’s Bonga oil field on March 4 for maintenance that will last at least a month.
SNEPCo said in a statement that Bonga, which has capacity to produce 225,000 barrels per day (bpd) of oil and 150 million standard cubic feet (scf) of gas, is expected to resume production at at some point in April, without giving further details.
Market sources had expected work on the field because there were no exports planned in March, compared with typical exports of roughly 200,000 barrels per day (bpd). Bonga produced an average of 192,500 bpd of oil in 2015, according to the latest annual data from Nigerian state oil company NNPC.
The Trans Forcados Pipeline, the main feed to the 400 000-barrel-a-day Forcados export terminal, has been shut for all but three weeks of the past year, Lagos-based SBM Intelligence said in its weekly risk analysis published Friday.
In their most sophisticated attack, militants used divers to blow up an underwater section of the pipeline in the Atlantic a year ago. Defying militant death threats, Shell flew in underwater engineers who took seven months to get the pipeline operational.
Two days later, the militants bombed it again. Shell Nigeria lost $3bn during the seven months of repairs, Africa Confidential newsletter estimated at the time. “Nigeria wants Royal Dutch Shell to reopen a major export pipeline in the Niger Delta but the oil major wants better protection first, to avoid having it blown up yet again,” SBM Intelligence said, quoting unidentified officials and industry sources.
Lowest rate of production
Shell Nigeria said only that one of its priorities is to secure the pipeline, while indicating it is still working to contain leaks. “Our focus on the Forcados leaks is on containment, spill recovery and securing the line,” spokesman Precious Okolobo told The Associated Press on Saturday.
Petroleum Minister Ibe Kachikwu announced last month that Nigeria, one of Africa’s top oil producers, lost between $50bn and $100bn in oil revenues because of militant attacks last year. At the worst point, he said, production was cut to 1.2 million barrels a day — a loss of 1 million barrels a day and the lowest rate of production in 30 years.
The Forcados terminal handles nearly one-quarter of Nigeria’s exports. So experts are puzzled by the state oil company’s declaration this week that production has risen to 2.1 million barrels a day — near optimal production of 2.2 million. “Nigeria has given differing figures for its oil output in recent weeks … without giving an explanation,” said SBM Intelligence, quoting figures between 1.7 million to 2.2 million barrels a day.
With Nigeria confronting its worst recession in 25 years, “We certainly hope the figures are true,” the analysts said. Oil militants say careless production in the southern Niger Delta has brought nothing but misery, with pollution from oil spills destroying farmlands, fishing grounds and millions of livelihoods.