MOSCOW, 14 Sep — PRIME. Oil production in Nigeria in August fell below a million barrels per day, to 980,000 barrels per day – a minimum that was observed in July 1985, the prospects for a recovery in production are disappointing, according to a September report by the International Energy Agency (IEA).
“Chronic underfunding, sabotage and oil theft continue to wreak havoc on Nigerian fields. After the almost complete shutdown of the Forcados flow, production in August fell below 1 million barrels per day, to a monthly low last seen in July 1985, and fell by 30 % since the beginning of this year. Oil production amounted to 980 thousand barrels per day (-100 thousand barrels per day compared to the previous month),” the IEA said.
As a result, Nigeria, usually considered the largest producer in Africa, fell behind Angola, Libya and Algeria. The IEA estimates that Nigeria missed its OPEC+ quota in August by 850,000 barrels per day.
“Total oil production, including condensates and liquid natural gas, fell to 1.3 million barrels per day from 1.7 million barrels per day in January this year. The outlook is disappointing,” the report adds.
According to the agency, Nigerian oil officials have repeatedly set and failed to meet production challenges, urging operators to get wells back up and running as quickly as possible. But recovering production from mature fields is difficult, even with advanced optimization techniques. According to the IEA, Nigerian companies are not reinvesting enough in drilling new wells and further developing assets. In addition, poor legal and regulatory frameworks and sabotage create additional difficulties.
“Nigerian President Muhammadu Buhari said the country’s oil revenues are being greatly impacted by widespread oil theft. To combat theft in the oil-rich Niger Delta, NNPC has engaged security agencies, including those owned by ex-militants. But many believe the problem is rooted in throughout the supply chain, making it intractable. With the rise in oil prices over the past six months, this situation seems to have worsened,” the IEA concluded.