NNPC Ltd Reports Nigeria’s Oil Production Approaching 1.7 Million Barrels Per Day.
Nigeria’s oil production is on the rise, nearing 1.7 million barrels per day (mbpd) from 1.28 mbpd in April, according to Mele Kyari, Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL). This was disclosed during a stakeholders engagement between the Nigerian Association of Petroleum Explorationists (NAPE) and the NNPCL in Lagos on Saturday.
Kyari attributed the drop in crude oil production to rampant oil theft and vandalism. He emphasized the critical need to tackle security challenges to boost production. “How do you increase oil production? Remove the security challenge we have in our onshore assets. As we all know, the security challenge is real. It is not just about theft, it is about the availability of the infrastructure to deliver the volume to the market,” Kyari said.
He revealed the extent of the problem, stating, “Within the last two years, we removed over 5,800 illegal connections from our pipelines. We took down over 600 illegal refineries – cooking pots or whatever they were. You simply cannot get people to put money until you solve that problem.” Due to pipeline vandalism, the industry has resorted to costly measures such as barging, which can cost up to $21 to transport a barrel of oil to the terminals.
Kyari noted the abnormality of current practices, saying, “Barging is not normal. Barging is not economical, even trucking. In 1991, we didn’t think of barging, even to put oil on the trucks. But that’s what we are doing today.” Despite these challenges, Kyari expressed optimism, stating, “The good news is, there is substantial work that is being done by the government and I’m not going to speak about it. But I know that this will come to pass. It’s already subsiding. We are already seeing the results.”
He pointed to a significant improvement in production, saying, “As of today’s data, we’re inching to 1.7mbpd. We won’t celebrate this. On 17th of April 2020, our production, without doing anything, without drilling new wells, shot to 2.2mbpd. The difference was COVID-19. The thieves, the vandals, everybody went to sleep.”
In terms of infrastructure, Kyari highlighted the importance of the AKK pipeline in ensuring gas supply. He assured that the remaining task to connect the east and the west, a 2.7 km river crossing, would be completed by the end of May or June, enabling the flow of gas from the east to the west.
The President of NAPE, Abiodun Ogunjobi, stressed the need for upgrading existing gas infrastructure and adding new ones for efficient gas production and utilization. George Osahon, Chairman of NAPE’s Board of Trustees, emphasized the importance of the NNPCL in promoting oil and gas exploration in Nigeria and called for industry support in technical training and research data availability.
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Chief Chamberlain Oyibo, the immediate past BOT Chairman, underscored the need for implementing good policies and incentives to address the decline in the nation’s reserve and production, urging industry stakeholders to continue production efforts.
This uptick in oil production offers a glimmer of hope for Nigeria’s economy. The Organization of the Petroleum Exporting Countries (OPEC) reported a marginal increase in Nigeria’s daily oil production from 1.23 mbpd in March to 1.28 mbpd in April, with a further rise to 1.7 mbpd being a potential economic boon.
