Nigeria loses N32bn daily to oil terminals’ shutdown - TrendyNewsReporters Nigeria loses N32bn daily to oil terminals’ shutdown - TrendyNewsReporters
ENTERTAINMENT

Nigeria loses N32bn daily to oil terminals’ shutdown

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Nigeria is losing at least N32bn daily due to the shutdown of three crude oil export terminals with a combined capacity of 580, 000 barrels per day.

A total of 200, 000 barrels per day are lost through the Forcados terminal, including  180, 000b/d through the Trans Niger pipeline.  Also, 200, 000b/d are lost through the Brass terminal, putting a total at 580, 000b/d.  At an average price of $130 for Nigeria’s crude grade, Bonny Light, putting the loss at $75.4 million or N32.4bn daily (at an exchange rate of N430/$).

Operated by Shell Petroleum Development Company, SPDC, the 200, 000 barrels Forcados crude oil export terminal has been shut down since early August, according to findings.

The stream is often the single largest export grade and has been under constant force majeure. Although The PUNCH could not lay hands on why the terminal was shut down this time, the last occurrence was in December 2021 and it was due to a malfunctioning barge that obstructed a tanker path.

Force majeure is a clause that allows a company to skip contractual obligations following issues beyond its control.

Sunday PUNCH learnt that repairs remain ongoing at the terminal and may be reopened late September.

As it stands, Sunday PUNCH learnt that there have been production shut-ins at the terminal, which would be shipped immediately the terminal is reopened.

A spokesperson for SPDC, Michael Adande, denied the report of force majeure at Forcados.

 “We did not declare a force majeure on Forcados,” he simply said, declining to speak further.

The second terminal, the 180,000-barrel-a-day Trans Niger Pipeline, TNP, one of two that feed Bonny oil terminal, has stopped transporting oil due to theft since June this year. Producers of crude oil, which runs through the pipeline, received as little as 5 per cent of crude volumes pumped through the pipeline between October 2021 and February.

The TNP was illegally tapped in about 150 places, the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN said in March when the local government checked some of the areas where the theft occurred.

The Brass terminal has also been shut down since June this year, according to a loading plan seen by Sunday PUNCH.

An operator of the terminal, ENI SpA, said the pipeline was shut due to illegal bunkering or pipeline tapping, resulting in a low amount of oil reaching the terminal. However, the Nigerian police said the two oil pipelines feeding the export terminal were blown up by explosives.

Spokesman for the police in Bayelsa State, Asinim Butswat, said in a statement that a trunkline carrying crude from Omoku to Brass Terminal at Etiama was blown up July 30. On Aug. 11, an improvised explosive device blew up another pipeline at Obama Tekere River, which also supplies the terminal.

Nigeria’s output fell to one million barrels a day in August, the lowest quarterly production since 2016, according to the National Bureau of Statistics, NBS.

Professor of Economics and Public Policy at the University of Uyo, Akwa Ibom State, Akpan Ekpo, told Sunday PUNCH during an interview that despite crude oil retaining 80 per cent of the total trade, Nigeria needed to diversify as oil revenue was no longer reliable.

“Oil prices are volatile, and we need to think of other ways to boost revenue,” he said.

Group Chief Executive Officer of the Nigerian National Petroleum Corporation Limited, NNPCL, Mele Kyari, had, in an interview late last month, blamed the country’s low crude oil outputs on theft resulting from pipeline vandalism in the Niger Delta.

According to him, 295 illegal connections had been located around the pipeline, which, according to him, led to the shutdown of production.

On his part, a lawyer advising NNPC Ltd on oil and gas projects and transactions and partner at Bloomfield Law Practice, Ayodele Oni, advised the Federal Government to provide solutions to the oil theft challenges bedeviling the country.

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