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Nigeria’s Production Quota Hits 1.8m bpd as OPEC Ups July Crude Allocation

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For the first time since April 2020, when the Covid-19 pandemic hit the global oil industry, the Organisation of Petroleum Exporting Countries (OPEC) yesterday increased Nigeria’s production quota to about 1.8 million (1.799) barrels per day.

 

The new oil drilling limit increased Nigeria’s production deficit by an estimated 400, 000 barrels per day, since the country had only been able to produce about 1.4 million barrels daily of the 1.8 bpd ration.

 

 

The cartel and its allies, OPEC+ would increase oil production by 648,000 barrels per day in July, as opposed to the 400,000 bpd initially approved and the subsequent increase to 432,000bpd.

 

This was just as the Group Managing Director of the Nigerian National Petroleum Company (NNPC) Limited, Mallam Mele Kyari , has said that with about 26 per cent of all Nigeria’s gas exported to Spain, the country remains a major market for Nigeria.

 

Also, the Defence Headquarters (DHQ) said yesterday that troops of the Nigeria Navy under Operation Octopus Grip and Operation Delta Safe discovered and destroyed 40 illegal refineries in the Niger Delta region in the last two weeks. Nigeria had blamed massive oil theft, years of declining upstream investment, inability to restart oil wells shut in the wake of the Covid-19 pandemic as well as outright sabotage by oil-producing communities for its lack of capacity to raise production.

 

From the approved schedule, Saudi Arabia would drill 10.833 million barrels per day in July, same for Russia, while the UAE would produce 3.127 million barrels per day.

 

In the same vein, Angola would produce 1.502 barrels per day, Iraq would be 4.58 million bpd while Algeria was given a limit of 1.039 million bpd.

 

THISDAY learnt that the increase by over 200,000 bpd was possibly to partly compensate for a small portion of Russian oil, which has been shut-in due to sanctions spurred by its war with Ukraine.

 

A communiqué released by the organisation after the 29th OPEC and non-OPEC ministerial meeting held via videoconference, also acknowledged the most recent reopening from lockdowns in major global economic centres.

 

It further noted that global refinery intake was expected to increase after seasonal maintenance and highlighted the importance of stable and balanced markets for both crude oil and refined products.

 

“The meeting therefore resolved to: Reaffirm the decision of the 10th OPEC and non-OPEC Ministerial meeting on 12 April 2020 and further endorsed in subsequent meetings, including the 19th OPEC and non-OPEC Ministerial Meeting on the 18 July 2021.

 

“Reconfirm the production adjustment plan and the monthly production adjustment mechanism approved at the 19th OPEC and non-OPEC Ministerial Meeting and the decision to adjust upward the monthly overall production by 0.432 mb/d for the month of July 2022.

 

“Advance the planned overall production adjustment for the month of September and redistribute equally the 0.432 mb/d production increase over the months of July and August 2022. Therefore, July production will be adjusted upward by 0.648 mb/d,” it stated.

 

It also resolved to extend the compensation period until the end of December 2022 as requested by some underperforming countries and called on underperforming countries to submit their plans by June 17, 2022.

 

While reiterating the critical importance of adhering to full conformity and to the compensation mechanism, OPEC noted that its next meeting will hold on June 30, 2022.

 

Meanwhile, the Minister of State, Petroleum Resources, Chief Timipre Sylva, speaking yesterday at the Nigeria-Africa Natural Resource and Energy Summit in Abuja, said while it was imperative to have a green initiative to fight carbon emission, it should reflect current realities and conditions.

 

As at today, Sylva argued that energy poverty was still much prevalent in the world, especially in Africa where millions of people still do not have access to electricity or clean cooking fuels.

 

“Based on the UN data, about 760 million people lack access to electricity worldwide, with three out of four of them living in sub-Saharan Africa. Furthermore, one-third of the world’s population – about 2.6 billion people – have no access to clean cooking fuels, with over 900 million of these in sub-Saharan Africa.

 

“On the average, only 48 per cent of sub-Saharan Africa population has access to electricity, while only 18 per cent has access to clean cooking fuels, compared with a global average of 90 per cent and 70 per cent respectively.

 

“In relation to CO2 emission, World Bank statistics shows that the world average of CO2 emissions was 4.48 metric tons per capita in 2018, with some regions and individual countries recording five to seven times this value. Emission by sub-Saharan Africa in total was only 0.76 metric tons per capita,” he argued.

 

The implication of this, he said, was that the issues surrounding energy poverty, climate and sustainable development are not mutually exclusive.

 

Consequently, he noted that the approaches to attending to these issues should not be disconnected, but stressed that climate change remains of serious concern to Africa.

 

“But of equal concern is the alarming level of energy poverty. Both must be addressed in a sustainable manner. It must be a win-win situation,” he maintained.

 

According to him, energy transition is about providing clean energy, and not about discriminating between energy sources.

 

With 26% Share of Nigeria’s Gas Export, Kyari Says Spain Remains Major Market

 

Kyari yesterday said that with about 26 per cent of all Nigeria’s gas exported to Spain, it remains a major market for the country. He, therefore, reiterated his commitment to sustaining what he described as the strategic energy partnership between both countries.

 

Kyari spoke while addressing Nigerian and Spanish business leaders on investment opportunities in the Nigerian oil and gas industry in Madrid, Spain, on the sidelines of President Muhammadu Buhari’s state visit to the country.

 

A statement by the Group General Manager, Public Affairs of the NNPC, Garba Muhammad, stated that Buhari had earlier met with the Spanish President, Pedro Sanchez, King of Spain, His Majesty, King Filipe VI, and had given a speech at the headquarters of the World Tourism Organization (WTO) in Madrid.

 

During the visit, the NNPC statement quoted Buhari as saying that Nigeria looked forward to increasing bilateral relations with Spain.

 

Describing the partnership between Nigeria and Spain as an important one for the NNPC GMD said: “26 per cent of all LNG produced in Nigeria ends up in Spain and 14 per cent of all crude oil produced in Nigeria ends up in this country. Clearly for us as a business, it is an important market for my company.”

 

Kyari explained that the world would need energy for today and for the future in industries such as power, Information Technology, automobile, among others.

 

“We know that energy transition is real. We know that net-zero by 2050-2060 is real. But it doesn’t mean zero hydrocarbons in 2050-2060. It means that you are going to have a cleaner use of hydrocarbons,” Kyari added.

 

He said that investors must get returns when they invest, with a high chance that they are able to recover their costs and make some margin from it.

 

According to him, in line with global acceptance of gas as a transition fuel, Nigeria has since declared 2021-2030 as the decade of gas.

 

“In our country today, we have a legislation that has clearly created a commercial National Oil Company (NOC) which will be unveiled by our president in the coming days.

 

“Together with the Spanish business community, I am confident we can build this industry,” Kyari explained

 

DHQ: Troops Destroyed 40 Illegal Refineries in Niger Delta

 

However, speaking at a media briefing in Abuja, yesterday, the Director, Directorate of Defence Media Operations (DDMO), Maj.Gen. Bernard Onyeuko, said the military recently launched an operation in the Niger Delta to curb the growing oil theft, illegal refining, vandalism in the country and sustained pressure on economic saboteurs and other criminal elements which had significantly reduced the oil thieves’ freedom of action. He said military operations were conducted in different theatres between May 19 and June 2.

 

Onyeuko said within the period under review, troops discovered and destroyed 40 illegal refineries, 165 metal storage tanks, 72 ovens, 23 dug out pits and five wooden boats.

 

In addition, he revealed that troops also recovered 1,107,400 litres of crude 456,450 litres of Automotive Gas Oil (AGO), 6,250 litres of PMS, six trucks, three outbound engines and one AK 47 rifle.

 

Troops also apprehended 21 criminal elements.

 

“Troops have sustained pressure on economic saboteurs and other criminal elements, and this has significantly reduced oil theft.

 

“Operations were conducted in creeks, towns and communities at Mosogar, Jesse and Warri Road in Ethiope West Local Government Area, and at Banga and Modangho Creek in Warri South West Local Government Area of Delta,” he said.

 

“Other locations are Okubotowa Creek in Akassa Brass Local Government Area, as well as Ikebiri in Southern Ijaw Local Government Area of Bayelsa.

 

“Operations were also carried out at the Gawthrone Channel in Bonny Local Government Area of Rivers, Akpabiyo Local Government Area in Cross River and Effiat Waterways, Ibaka, in Akwa Ibom,’’ Onyeuko said

 

He said all recovered items and apprehended criminals were handed over to the appropriate authorities for further action.

Culled from THISDAY

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