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How we Raise Crude Oil Production From 900,000bpd to 1.6mbpd – NNPC (Video)

The Nigerian National Petroleum Company (NNPC) Limited yesterday reaffirmed that with the return of Forcados and partial restoration of the Trans Niger Pipeline (TNP), Nigeria’s oil production had hit 1.6 million barrels per day (mbpd).

NNPC explained how the national oil company was able to ramp up crude oil production, which had fallen significantly, with the collaboration of the security agencies, regulators, oil producing communities, and other stakeholders.

Speaking on Arise News Channel, THISDAY’s broadcast arm, Chief Upstream Investment Officer of the NNPC Upstream Investment Management Services (NUIMS), Bala Wunti, also clarified the much-reported 700,000 barrels per day losses incurred by the national oil firm.

Wunti explained that based on all the calculations, Nigeria was losing, on the average, over 700,000 barrels per day. He explained that in hydrocarbons accounting, the figure included engineering losses, oil theft, as well as what would have been produced due to shutdowns, which he described as opportunity losses.

Before the recent recovery, he stated that Nigeria was losing about 21 million barrels per month and up to $1.9 billion every 30 days.

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“If you take an average oil price of $90, that will translate to somewhere in the neighbourhood of $1.9 billion losses that we suffered,” he said.

Wunti stated that at least 68 vessels had been impounded since the renewed fight against crude oil theft, saying some of the culprits are being prosecuted by the appropriate authorities.

He said the collaboration between the security agencies, local community contractors, and NNPC led to the return of Forcados, while Brass and Bonny, which were shut down due to force majeure, were expected to begin operation soon.

He pointed out that while the Trans Niger Pipeline (TNP) was yet to fully return, it had now been partially restored, leading to the increase in reported production figures.

“Forcados is back, Bonny will soon be back,” he assured.

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Before now, Wunti stated that the industry was using technology sub-optimally, which made it very difficult to have an end-to-end visibility of NNPC’s infrastructure.

Wunti stated that there was currently about 350,000 bpd to 400,000 bpd augmentation to the volume being produced hitherto, adding that Nigeria drills about 1.6 million bpd currently.

According to him, NNPC now has the capability to see its assets fully from end-to-end, and about 70 per cent of identified illegal refineries have been deactivated.

“It is just mind-boggling what we have discovered and we could see the level of sophistication where illegal connections were put on our trunk lines,” he stated, describing it as a very complex situation.

He stated that there were several layers of security protecting the country’s oil infrastructure, explaining that every level is now monitored by other levels to check underhand dealings.

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The reduction in production had cut the contribution of foreign exchange earnings from crude oil export from 90 per cent, when production was high, to 78.5 per cent as of the third quarter of 2022, THISDAY learnt.

As crude theft increased, the federal government and some private security groups, including Tantita Securities Service, owned by Government Ekpemupolo, also known as Tompolo, Pipeline Infrastructure Nigeria Limited (PINL), and Maton Engineering Limited, were contracted by the government.

Wunti stated, “The new security architecture relies on technology. What it does is to bring together the security and intelligence agencies on one table, the regulators on the other, and then bring in the community into the other angle and without the community, we can’t achieve that.

“Today, we are able to detect and we able to respond. The success that we recorded is essential because of this improved security situation. We are now almost at an average of 350,000 to 400,000 bpd increase. At a certain level we recorded up to 450,000 bpd increase.

“That is why you can see we are now from 1.1 million bpd daily to about 1.59 million bpd as at this morning (yesterday). So, these are some of the things that we are able to record based on the new security architecture.”

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He assured that the collective resolve of private and government securities would lead to further improvement in crude oil production, which would, in turn, reflect in foreign exchange earnings by the country.

According to him currently, about 638 illegal refineries, out of 763, have been destroyed, even as the security architecture is being institutionalised.

Wunti said, “We have incapacitated almost about 70 per cent of what we have identified and we will keep identifying some of them. It is mind-boggling what we discovered even as operators and every one of us saw the kind of sophistication, where illegal connections are put on every major trunk line, including direct export lines on Forcados.

“It couldn’t have been possible without the collective resolve of the private security guards anchored by the communities. We have short to medium and long term visibility. I can tell you we have succeeded to an extent to stop this menace.

“The question now is how to stop its growth. That is why we introduced checking the checker. What that means is that we have four layers of visibility.”

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Wunti also said persons arrested in connection with the criminal oil theft and bunkering activities were currently being prosecuted. He said in due course, their identities would be disclosed to the surprise of Nigerians.

Watch the video below:

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