Connect with us

Business

How Nigeria lost N74.51bn oil revenue in December – OPEC

Published

on

 How Nigeria lost N74 51bn oil revenue in December OPEC

A new monthly report of the Organization of the Petroleum Exporting Countries has shown a plunge in Nigeria’s crude oil production in December 2021, triggering a loss of about N74.51bn in oil earnings.

According to OPEC data, Nigeria produced an average of 1.19 million barrels per day in December, down from 1.26 million bpd in November, based on direct communication.

This means an average daily loss of 78,000 barrels was recorded in December, translating to a total loss of 2.42 million barrels in the month.

READ ALSO:OPEC thumbs up Ganduje on execution of developmental projects

In December, the average price of Brent, the international benchmark against which Nigeria’s oil is priced, was $74.17 per barrel, according to figures from countryeconomy.com.

At the official exchange rate of N415.45 to a dollar, it implies that the loss of 2.418 million barrels of crude oil in December reduced the country’s earnings by about N74.51bn.

Further analysis of OPEC’s latest report indicated that in the first quarter of 2021, Nigeria’s oil production stood at an average of 1.312 million bpd.

This moved up to an average of 1.34 million bpd in Q2, but the momentum could not be sustained, as the country’s crude oil production dropped to 1.27 million bpd in Q3.

OPEC said the plunge in oil production in the West African nation persisted in the fourth quarter of last year, dropping to an average of 1.233 million barrels daily in the last quarter.

Aside from the menace of pipeline vandalism in the Niger Delta, the continued oil production plunge in the last quarter of 2021 might not be unconnected to the oil leak recorded in Santa Barbara, Nembe, Bayelsa State.

In November, the Federal Government announced that it was investigating the cause of the oil spill in Santa Barbara which occurred in a facility operated by Aiteo.

The government had disclosed this through its Nigerian Upstream Petroleum Regulatory Commission.

Before the leak was plugged, Aiteo Eastern Exploration and Production Company had earlier announced that high-pressure effusion prevented its personnel from plugging the wellhead leak around the OML 29 southern oilfield.

The affected facility discharged high volumes of crude into the marine environment for several weeks after the spill occurred on November 5, 2021. Aiteo had reported five days later that the magnitude of the incident was of “an extremely high order.”

Crude oil revenue losses in Nigeria have lingered due to various challenges in the sector despite efforts to curb them by the government and its agencies.

On December 27, for instance, Nigeria lost crude oil valued at about N556bn between August and October last year due to pipeline vandalism, community interferences, and sabotage of oil facilities, among others.

Data compiled from NNPC’s Crude Oil Marketing Division report of events that affected oil production in August, September and October indicated that the country consistently posted losses during the period under review.

The report had shown that the worth of the crude volumes lost by the country in August, September and October were N194.71bn, N195.246bn and N166.05bn respectively.

This implies that the value of crude oil that was lost by Nigeria during the three-month period was about N556bn.

To curtail the menace, stakeholders called for the deployment of the latest technologies in securing oil infrastructure.

The National Public Relations Officer, Independent Petroleum Marketers Association of Nigeria, Chief Ukadike Chinedu, said, “Government should deploy automated pipelines as well as latest technologies to protect oil assets.”

On his part, the former President, Association of National Accountants of Nigeria, Dr Sam Nzekwe, said, “We can’t be losing such huge sums. The government should explore other forms of technology to manage this concern.”

(PUNCH)

Subscribe to Our VIP Newsletter



© 2018- 2022 PlatinumPost Multimedia Limited. All Rights Reserved.

JoinOurWhatsAppChannel

- Website Designed By DEBORIAN.COM, a Nigerian Web Designer and Web Developer -