The Nigerian National Petroleum Company (NNPC) Limited, , yesterday unveiled a new grade of crude called Nembe, and particularly suited to the European market
The Company also reassured of the country’s determination to ramp up crude production.
The country has long dealt with output declines due to crude theft, attacks on pipelines in the Niger Delta and a lack of investment, causing a dwindling of government revenue and large fiscal deficits. But output has picked up in recent months.
Nembe production was formerly added to the Bonny Light stream more than three years ago, until instances of sabotage on the Nembe Creek Trunk Line (NCTL) hamstrung output, an NNPCL source told Reuters on the sidelines of the Argus European Crude conference in London.
Now, the country has managed to resurrect Nembe as a separate grade, he added.
The first cargoes of Nembe were sold in October, consisting of two 950,000 barrel shipments sold to France and the Netherlands, a second NNPCL source told Reuters.
The first Nembe cargo was sold to UAE-based trading firm Gulf Transport & Trading, which loaded the cargo onto the Suezmax tanker Maran Orpheus for a voyage to an unknown end buyer in Fos, France, a source familiar with the matter told Reuters.
The Nembe is similar to Nigeria’s other distillate-rich grades such as Forcados, Bonga and Egina, Maryamu Idris, executive director of crude and condensate at NNPC Trading told the conference.
The low-sulphur grade commands a premium to the global Brent benchmark, and is a good candidate to compete with Brazilian and Azeri crude grades for European refiners, she added.
Production of Nembe is currently around 50,000 barrels per day, but the NNPCL is aiming for a rise to 80,000 by the first quarter of next year and 150,000 barrels per day by the start of 2025, the source added.
An October Reuters survey showed Nigeria produces roughly about 1.5 million barrels per day (bpd), up from 1.39 million bpd in September, according to OPEC figures. But the country hopes to ramp up production to about 1.8 million bpd by the end of 2023, a third NNPC source told Reuters.
Last week, sources told Reuters that NNPCL was set to supply the keenly anticipated Dangote oil refinery with up to six cargoes of crude oil in December to be used in test runs.
Nigeria imports almost all its refined fuel needs due to inadequate capacity and poor maintenance. The country is now pinning its hopes of ending fuel imports on the 650,000 bpd refinery being built by Aliko Dangote.
The refinery is expected to run on crudes that carry an API gravity of 29 to 34 degrees, the first NNPCL source said.
API gravity is an index of the density of a crude oil – typically in the range of 15 and 45 degrees. Higher API indicates a lighter, lower density crude. Nembe carries an API gravity of 29, the source added
