Seplat: Nigeria's Trans Forcados Pipeline To Reopen Near End 2Q

Reuters

FLORENCE/LONDON, Jan 30 (Reuters) - Nigeria's Trans Forcados Pipeline which has been shut for most of the last year could reopen "towards the end of the second quarter", Seplat Chief Executive Austin Avuru said.

The pipeline, operated by the Nigerian Petroleum Development Company (NPDC), has been hit by several militant attacks, the first on a subsea section in February.

Although it reopened briefly in the autumn after months of repairs, further attacks meant the pipeline quickly closed again.

Sources have told Reuters that while repairs are again underway, a lasting resumption on the pipeline would be nearly impossible without a broader deal with militants in the restive Delta region.

"We have a lot of locked-in production which we intend to unlock by exploring various other means...beyond the Trans Forcados," Avuru told Reuters on Monday, adding the company is looking at the Escravos export avenue as one option.

Seplat, a Nigerian oil and gas exploration company that is listed on the London and Lagos stock exchanges, has a typical production of 75,000 barrels per day (bpd) which is exported either via the Forcados export terminal or the Warri refinery.

The outage of Forcados crude oil, with more than 200,000 bpd of capacity, has been a blow for the companies such as Seplat and Royal Dutch Shell that produce or export it and also for the Nigerian government, which has been starved of revenue.

Seplat and NPDC, with the help of oil trader Mercuria, have been exporting from the Warri refinery roughly 20,000 bpd of crude from fields that usually go via the pipeline. This oil, dubbed Forcados Light due to specifications that have varied from the standard Forcados grade, have been exported via Warri since at least May.

The avenue is limited, and more complicated and expensive, than exporting via the Trans Forcados Pipeline, but the oil has found markets in Europe, the United States and West Africa.

"On the whole we think that into the second half of the year we should be back to decent production," Avuru said.

(Editing by Jason Neely and Alexander Smith)

Copyright 2017 Thomson Reuters. Click for Restrictions.

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