Shell Discovers Another Oil Leak After Resumption Of Forcados Export Facility

Nigeria’s oil production is facing another major challenge following discovery of another oil leak in a facility operated by oil major Shell.

Shell is currently investigating a possible leak on its Trans Niger oil pipeline that traverses Bodo community in Nigeria’s River state following an August 18 report, a spokesperson said on Monday.

The 180,000-barrel-per-day pipeline is one of two conduits that export Bonny Light crude.

“We are working with the community and other stakeholders to ensure we can safely look into and resolve this situation,” spokesperson Bola ‘Salt’ Essien-Nelson told Reuters following an inquiry.

Oil theft and pipeline sabotage are common in the southern oil production heartland of Nigeria, Africa’s top crude producer.

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The oil major blames most spills on pipeline vandalism and illegal tapping of crude.

This incident is coming after Nigeria resumed the export of about 220,000 barrels of crude oil per day at the Forcados terminal.

The terminal was shut for maintenance on July 12, 2023 when workers saw ‘fumes’ near a single buoy mooring where oil was being loaded onto a vessel.

The development contributed partly to the inability of Nigeria to meet the quota of the Organisation of Petroleum Exporting Countries, OPEC, during the period.

Consequently, the resumption of export at Forcados would impact on the nation’s total oil production, which fell by 13.6 per cent to average 1.08 million barrels per day in July 2023 compared to 1.25mbpd recorded in June.

According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), August 2023 report, the latest production figure is a major setback for the government which has a production target of 1.69 million barrels per day in the 2023 budget.

The volume of production is also significantly lower than the 1.7 million barrels per day production quota allocated to the country by the Organisation of Petroleum Exporting Countries (OPEC).

A closer look at the data released by NUPRC also showed that blended and unblended condensate oil daily production in July were 38,258 barrels and 174,509 barrels respectively. Condensate oil productions are not part of Nigeria’s OPEC production requirement.

In total, daily average oil production in July was 1.29 million barrels per day, a 12.8 per cent drop when compared to total average daily production of 1.48 million barrels in June.

The NNPC Limited had said it expects oil production to hit 1.8 million barrels per day by the fourth quarter of this year, as measures put in place to boost production begin to yield results.