HICGI News Agency Updated 0724 Friday 29th July 2022
Nigeria’s economy received a further blow recently as an oil pipeline with the capacity to move 180,000 barrels of crude daily across Nigeria was hit by oil thieves, forcing it to halt the transportation of oil since June.
However, according to Bloomberg, who quoted an insider who is familiar with the issue, the Trans-Niger Pipeline has yet to be formally shut. The link’s capacity is about 15 percent of Nigeria’s most recent average daily output, according to Bloomberg calculations.
Nigeria — Africa’s largest oil producer and a member of the Organization of Petroleum Exporting Countries — has tried to stamp out sabotage on its pipeline network in recent years. Oil theft remains a chronic problem for the midstream system known as the TNP.
Analysts have said oil theft is responsible for Nigeria’s failure to meet OPEC’s output quota as recent efforts by the Nigerian government to combat oil bunkering have been futile which makes oil theft one of the most chronic problems facing the Nigerian oil industry.
Producers received as little as 5 percent of crude volumes pumped through the pipeline between October 2021 and February, an industry union reported earlier this year. It reflects a larger issue for Nigeria, which is facing shrinking investment and hasn’t been able to meet its OPEC+ oil-production quota in order to benefit from a surge in prices.
Nigeria has been pumping about 534,000 barrels daily, which is about 30 percent lower than its daily output quota.
A report by International Energy Agency (IEA) in June said that crude oil producers like Nigeria have failed to advantage of the hike in oil prices because of their inability to scale capacity.
The TNP was illegally tapped in about 150 places, the Petroleum and Natural Gas Senior Staff Association of Nigeria said in March when local government checked some of the areas where the theft occurred.
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