Original estimates given by the Nigerian National Petroleum Corporation (NNPC) of a 600,000 bbl/d shut-in has now been increased to 1 million bbl/d due to excessive force by militants in the Niger Delta.
According to the NNPC, Nigeria and JV partners may be losing $90 million a day because of the shut-in. Nigeria, the largest oil producer in Africa, has no reserve capacity because the country has ordered that all of its producing fields be placed onstream to meet quotas determined by the Organization of Petroleum Exporting Countries (OPEC).
Nigeria's National Petroleum Investment Management Services held an audit of the country's oil production. The results of the audit illustrated that the volume of the shut-in wells had reached the 1 million mark.
A source told The Guardian, a Nigerian daily news source, that the OPEC quota of 2.1 million bbl/d was easily met last year, but this year the capacity is "not there."
"What the NNPC has done is to look at its operations with the partners both in the joint venture arrangement and Production Sharing Contract (PSC) model, and we can say that our capacity is now down by about one million barrels in a day," the source said.
The Guardian states that "before the crisis in the Niger Delta got to this stage, Nigeria had spare capacity that it could even overshoot OPEC quota if she so wished, but the situation is so bad now that the country has to rely on deepwater fields to be able to build this extra capacity again."
Nigeria has forecasted a capacity of 4 million bbl/d by the year 2010.
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