Eni Restores Nigeria Oil Output

Niger Delta, Nigeria
(Click to Enlarge)
LONDON (Dow Jones Newswires)

Crude oil production from Eni SpA'S (E) Okpoho and Okono fields in Nigeria has returned to its normal 65,000 barrels a day output, traders of West African crude said Thursday.

Production from the fields was shut-in after a militant group attacked May 3 an offshore production ship 55 miles off the southern coast of Nigeria in the Okono field.

However, traders say that with two cargoes of Okono and Okpoho crude now indicated in provisional loading plans for July, the fields are back at normal output.

"Seems Okono is back, two cargoes in July would indicate normal production," a trader said.

However, nobody was immediately available to comment at Eni's office in Rome.

"Two cargoes on (offer in) July," said a second trader, who added "production started a couple of weeks ago."

The floating, production, storage and offloading ship Mystras, which receives, processes and stores oil, wasn't damaged during the early morning raid according to Eni.

Production, however, which is fed to the ship from the Okpoho and Okono fields were suspended after six Eni workers were seized. Eni's equity stake in the fields' production is 11,500 barrels a day.

The Movement for the Emancipation of the Niger Delta claimed responsibility for the attack and said it had intended to destroy the ship, jointly run by Saipem SpA (SPM.MI) and SBM. The workers were subsequently released unharmed.

"Production is up and running again at Okono - it's a step in the right direction in terms of bringing back all the lost output (from the region)," a third trader added.

News of returning production in Nigeria has invigorated trade of physical cargoes with reports the August loading program is selling quickly.

Bids and offers for Nigerian grades Bonny Light and Qua Iboe crude for loading in August remain wide apart, according to traders, with bids at Dated +$2.25 compared with offers at Dated $2.65.

Copyright (c) 2007 Dow Jones & Company, Inc.


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