Nigerias Crude Oil Exploration and Production Drops due to Uncertainty in Petroleum Industry Bill
Published By : 19 Aug 2015 | Published By : QYRESEARCH
The latest report published by Nigerian National Petroleum Corporation (NNPC) states, the country’s oil production and exploration activity have hit a new low. The data showed only Addax and Shell Petroleum Development Company (SPDC) engaged in drilling or exploration activities in the March 2015. Ever since November 2014 Nigeria has been recording poor oil production activities as many firms started bringing down their out owing to uncertainties in the Petroleum Industry Bill (PIB) and plummeting crude oil prices.
As several oil and gas firms were running in losses, it forced them to defer or cancel projects. In the monthly report published by OPEC statistics showed that Nigeria witnessed second biggest drop of rig counts in March. The country’s production accounted for 1.69mbpd in the same month as compared to 2.21mbpd in period last year.
The sudden drop in production, development, and exploration activities has been linked to the increasing insecurity of pipeline sabotage, oil theft, and cuts on funding by NNPC for joint venture projects.
The fall in oil production was further accelerated due to NNPC’s inability to fund the JV partners. According to NNPC, the total wellhead production for the month reached 60.60 million barrels. NNPC further added that crude oil and condensates lifting for export and domestic purposes reached a figure of 62.68 million barrels. The data disclosed by NNPC also showed that oil companies lifted around 35.55 million barrels, while the corporation listed 27.12 million barrels. The NNPC’s liftings can be divided into, 21.37 million barrels for Federation Account and 5.76 million barrels was for domestic purposes.