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African News Dimension/Nigerian Tribune: Nigeria’s $40m/day profit loss

June 14, 2006
 
With the recent militant attacks in Niger Delta, oil companies have been forced to halt operations in the region resulting in Nigeria losing a massive $40 million a day as 550 000 barrels of oil are not being produced.
 
By Martin Ayankola

Nigeria’s daily oil production will approach three million barrels per day (bpd) if the oil fields that were closed down in the wake of militant attacks on oil installations in the Niger Delta return to full operations, said the minister of state for petroleum and the Organisation of Petroleum Exporting Countries (Opec) president, Dr Edmund Daukoru.

Daukoru who spoke on Sunday in Kuala Lumpur, Malaysia, said that Nigeria’s oil production currently stood at 2.4 million bpd.

He said he was hopeful that the 550 000 bpd that were lost due to a halt on production since February, 2006, as a result of militant attacks, would be regained. The halted oil production in The Niger Delta means Nigeria is losing out on close to $40 million a day.

Daukoru commented that Royal Dutch Shell had expressed fears that the process of restoring output would take alot longer than expected.

“I hope it will be a month, but Shell says it would take a bit longer than that,” said Daukoru.

Predictions that oil production would be up-and-running within a matter of weeks have been cast aside in Nigeria.

Fresh output from Nigeria’s deepwater regions is currently compensating for the loss in output in the Niger Delta and is boosting production to 2.4 million bpd, Daukoru said.

This is higher than the 2.29 million bpd figure estimated in a Reuter’s survey done by analysts, consultants, and industry sources for May.

“We’re hiking up our deepwater production… deepwater is making up for conventional territory,” said Daukoru.

Over the past year, Nigeria, the biggest oil producer in Africa, had begun pumping oil from a host of new deepwater fields including Royal Dutch Shell’s 225 000 bpd Bonga developments and ExxonMobil’s 150 000 bpd Erha field.

More developments led by Total and Chevron are expected to follow over the next two years.

Speaking in Seoul on Monday, Daukoru said Nigeria planned to boost its capacity by 1.5 million bpd by the end of 2007, helping it to meet strong demands in Asia and the United States that has fuelled a surge in prices.

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