Nigerian crude and condensate output in August fell 6.7 per cent month on month to an average 1.53 million per day, according to data from the upstream regulator, the Department of Petroleum Resources (DPR).
August crude production fell to 1.24 million b/d from 1.32 million b/d in July while condensate output fell to 291,300 b/d from 316,237 b/d, DPR data showed, S&P Global, said in its update on Nigeria obtained from its website.
The decline was mainly attributed to the issues at Forcados, which slumped to 95,694 b/d in August from 218,196 b/d in July.
Nigeria’s crude oil production cap under the OPEC+ deal was 1.596 million b/d for August.
Nigerian oil output has fallen sharply in the past few weeks due to an oil spill near the key Forcados export terminal, industry and ministry sources said September 8.
Nigeria had already been facing many operational and technical problems in the past few months. Key crudes such as Bonny Light, Escravos, Forcados and Qua Iboe have all faced production issues in 2021.
Shell declared force majeure crude loadings of key export grade Forcados Aug. 13 due to “the curtailment of production and suspension of export operations as a result of some sheen noticed on the water around the loading buoy”.
The terminal was still not fully ready for operations due to the oil spill, the sources said.
Supply risksS&P Global Platts Analytics expects Nigerian crude supply to remain below its OPEC production quotas in coming months due to the disruptions, with a downside risk to 2022 forecast if operational setbacks continue.
“With Nigerian crude supply capped below 1.5 million b/d since May, averaging 100,000 b/d below OPEC+ quota, risks are clear to our forecast supply growth from 1.4 million b/d in August to over 1.7 million b/d by year-end,” Platts Analytics said in a recent note.
Nigeria has the capacity to produce around 2.2 million-2.3 million b/d of crude and condensate, but production has averaged around 1.50 million b/d for the first eight months of 2021, according to S&P Global Platts estimates, to meet OPEC+ caps.
Growing threats by militants to renew attacks on oil infrastructure in the restive Niger Delta also pose a huge concern for Africa’s largest oil producer.