Nigeria loses N20bn daily to pipelines vandalism
Following continued attacks on Nigeria crude pipelines and other oil installations in the Niger Delta region, the Federal Government and its Joint Venture (JV) partners may now be losing N20billion daily.
Daily crude oil output has fallen to a record low of 800,000 barrels per day, according to industry sources, a claim which opposed to by Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, who stated during the week that daily crude output has fallen to 1.3million bpd.
Considering the fact that Nigeria’s OPEC quota remains 2.2million bpd, and that the 2016 budget was benchmarked at same output level of 2.2million bpd, the country and its JV partners are losing 1.4million bpd to the attacks by the Niger Delta Avenges (NDA). At an average of $50 per barrel, the country is losing about N20billion per day (at an exchange rate of N285 to a dollar).
An industry source confirmed to Saturday Tribune on Friday that “we are now close to 2007 record low of 700,000bpd which forced the government of the late Umaru Yar’Adua to dialogue with and grant amnesty to the militants.
“There is the need for the government to get those behind the NDA and dialogue with them because they have stated that their objective is to achieve zero crude production from the region,” the source said.
The direct consequences of these attacks on Nigeria’s oil installations are losing of market shares to countries like Iran and others. “Declaration of force majeure on exports of some grades of Nigerian crude oil have created supply uncertainty to the major buyers of Nigeria’s crude oil, mostly foreign refineries. The refineries from India, United States and others are backing away from buying Nigerian oil and turning to Iran and other Middle East countries for sustainable crude oil supply,” he said.
Following the announcement by the federal government that it has entered into dialogue with the NDA on Tuesday, the militants claimed it didn’t dialogue with the government and struck Chevron-operated RMP 20 Well at Didi community in Egbema, Warri North Local Government area of Delta State.