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Militancy: Agip, Aiteo shut down 140,000 barrels per day crude production

By News Express on 05/06/2016

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The attacks by new militant group, Niger Delta Avengers have led to a crude oil production loss of 140,000 barrels daily by Agip and Aiteo from its oilfields in Bayelsa State.

At about $48 per barrel, an estimated $6.72 million daily is lost by the two operators due to attacks on oil export pipelines operated by Agip and Aiteo alone. Eni, Italian energy firm and parent company of Nigerian Agip Oil Company (NAOC) said the oil firm’s production has been cut by 65,000 barrels per day following Friday’s attack on its pipeline in Bayelsa. Earlier attacks in the oilfield on May 18, and 24 had resulted to a shutdown of some 5,200 barrels of Eni’s equity share of oil output.

An Eni Spokesperson confirmed the development in an email on Sunday. “The total deferred production due to the attack is 65,000 barrels of oil equivalent daily. I can confirm that. There is no further impact on production, since all production from the swamp area has already been stopped days ago,” the email from Eni’s Media Relations Unit said.

Also Aiteo, operator of the Nembe Creek Trunk Line which came under attack by the militant group on May 28, 2016 according to its Spokesman, Mr. Shola Omole said the line which conveys crude to Bonny export terminal was shut.

Omole said some 75,000 barrels daily production was deferred as the line remained out of service. Although figures from Shell Petroleum Development Company (SPDC) could not be obtained for this report, the oil firm had placed its oil exports from Bonny export terminal under force majeure.

Force Majeure is a legal clause that frees a company from liabilities arising from its inability to meet contractual obligations due to reasons beyond its control. SPDC which in 2014 sold the 100 km Nembe Creek Trunk Line to Aiteo still relies on the line to lift crude produced from onshore oilfields in Bayelsa to the Bonny Terminal in Rivers.

Mr. Ibe Kachikwu, Minister of State, Petroleum Resources was quoted on Thursday as saying that Nigeria was producing 1.6 million barrels per day which excludes further production outages due to attack on Agip, Chevron and Shell at the weekend.

The development will likely affect the implementation of the 2016 budget premised on a daily crude oil production of 2.2 million barrels of crude.

•Photo shows Niger Delta militants.

Source News Express

Posted 05/06/2016 9:23:22 PM





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