Nigeria’s oil production to hit 1.8mbpd

…as Shell officially announces lift on Focardos force majeure

Nigeria’s oil production is set to hit 1.8 million barrels per day, as Royal Dutch Shell has lifted force majeure on exports on Forcados crude oil.

Force majeure is a legal declaration that means the operator cannot fulfill a contract due to circumstances outside its control.

According to a statement issued by the company on Wednesday, Nigeria’s oil exports is now back fully for the first time in 16 months since its shutdown.

This confirms earlier two reports by The Daily Times hinting about a hush-hush loading and exporting of crude oil from the pipeline, and that Nigeria had issued a loading plan for Focardos which could push exports to about 15-months high this month.

As usual, Forcados will be exporting between 200,000-240,000 barrels per day (bpd), bringing Nigeria to around the 1.8 million-bpd.

Once the country hits its 1.8mbpd target then, it would be joining the Organisation for Petroleum Exporting Countries, OPEC, output cut.

Nigeria and Libya were exempted from making the output cut due to political instability in Libya, and pipeline vandalism by militants in Nigeria’s Niger Delta.

OPEC producers agreed last month to extend output cuts of about 1.8 million bpd until March 2018.
Forcados had been under force majeure since February 2016 after a militant attack on the main export route, the Trans Forcados Pipeline.

In our earlier report, The Daily Times gathered that TFS resumed sometime between May 15 and 20, 2017, but most companies involved have been quiet about it.

The facility is being operated by Shell, and ten Nigerian independents: Seplat, Elcrest, Shoreline, Neconde, Shell Petroleum Development Company, Pan Ocean, NDWestern, Pillar, Midwestern, Energia and Platform.

Until it was shut down in February 2016, Forcados was the only pipeline through which the likes of Seplat, Elcrest, Shoreline, Neconde, Pan Ocean and NDWestern, exported their products.

However, the likes of Pillar Oil, Midwestern, Energia and Platform Oil, used it as a secondary export line.
In the period that the shut- in lasted, we gathered that Seplat, Elcrest, Neconde and Shoreline, had sourced for alternative routes of exporting like through shipping.

Forcados came back up last November, nine months after the original blast, but it was immediately vandalised by oil militants again.

“The Shell Petroleum Development Company of Nigeria Ltd (SPDC) lifted the force majeure on crude oil exports from Forcados Terminal,” the firm said in a statement on Wednesday, saying the move was effective from 4 p.m. (1500 GMT) on Tuesday.

“SPDC is grateful to various stakeholders, particularly the federal and Delta State governments, security agencies, NNPC and communities for their support in the repair of the three sabotage leaks on the pipeline,” it said.