Oil exports on course despite
militants’ attacks
By Omoh Gabriel, Business Editor, with agency
reports
Nigeria in May exported 1.89 million barrels per
day, contrary to fears that crude export has dropped
to as low as 1.3 million barrel per day. Data
released by Windward, a maritime intelligence firm
showed that Nigeria’s crude oil exports in May
dropped by just 62,000 barrels per day (bpd) from
April, with exports still reaching 1.89 million bpd.
Windward tracks all exports coming from Nigeria
including crude oil, condensates and ship-to-ship
transfers, so its figures are nearly always higher
than estimates of crude oil production alone. But its
figures indicate that Nigeria exported between
300,000-500,0000 bpd more than what OPEC and
other agencies thought it had produced in May.
Repeated militant attacks Nigeria, according to the
firm, kept exporting crude oil at a largely steady
pace in May, though below historical levels, despite
repeated militant attacks on its infrastructure that
drove output down to 30-year lows and helped
global prices rise, the data showed.
The data from the maritime intelligence firm,
Windward, and Thomson Reuters revealed a far
smaller drop in exports from April to May than
most in the market had suggested. It suggested
that Nigerian oil production is more resilient than
many thought. The oil industry has been grappling
with a spate of militant attacks that took out the
Forcados crude oil stream in February and affected
Bonny Light, Brass River and Escravos in May,
mainly by targeting pipelines taking crude to export
terminals.
An accident on the terminal exporting Qua Iboe, its
largest oil stream, further knocked production and
led the International Energy Agency (IEA) to declare
May production at 30-year lows of 1.37 million bpd.
But Windward showed May exports dropping by just
62,000 barrels per day (bpd) from April, with
exports still reaching 1.89 million bpd.
The figures are significant, particularly as the
government announced a 30-day ceasefire with
militants yesterday that could forestall further
attacks on oil sites. “It was the gains from small
fields that offset declines from others,” said James
Davis, head of crude supply at FGE Energy. “The
disruptions in the fields that were out was pretty
much what we expected. What we didn’t expect was
the marginal increases in other fields.” Reuters data
showed total exports in May at roughly 1.67 million
bpd, down from 1.77 million bpd in April, and also
a rise in exports of grades including Bonga,
Agbami, Antan, Amenam, Okwori that helped offset
the losses.
The figures remain sustantially below the close to 2
million bpd Nigeria has exprted in the best of
times. Still, they suggest that many industry
observers, for example the “secondary sources”
polled by OPEC that pegged Nigeria’s May
production at around 1.4 million bpd, were overly
pessimistic about its ability to keep pumping.
Trade sources noted that some of the oil could have
come from crude stored at export terminals and on
ships offshore. But these volumes are not typically
substantial in Nieria, and most traders noted that oil
kept flowing from streams that had been repeatedly
attacked, including Bonny Light and Brass River,
while the Qua Iboe outage was shorter-lived than
expected. According to Windward data, 22 million
barrels exported in the last 10 days of May pushed
exports closer to par with April. Davis said the full
ramifications of Nigeria’s unrest remain unclear.
The rise in Qua Iboe exports would be offset by
further declines in Bonny Light and Brass River, both
of which have faced additional strikes. “The real
impact would be whether there is damage at a field
level that is significant enough to have a long term
impact” Davis said.