Increased oil production is crushing oil theft in Nigeria as oil revenues are set to rise, following the Bonga FPSO production resumption.
A November 17 statement from Shell Nigeria Exploration and Production Company Limited (SNEPCo), says the 2022 Turnaround Maintenance (TAM) of the Bonga Floating Production Storage and Offloading (FPSO) vessel has been completed. SNEPCo said:
- “Commissioning and start-up activities are in progress and will culminate in the ramp-up of oil and gas production in the coming days.”
The monthly oil market report (MOMR) from the Organization of Petroleum Exporting Countries (OPEC) stated that Nigeria’s crude oil production recorded over a million barrels of oil production per day (1.014mb/d) for October 2022, the first time since July 2022. Crude oil production in the country has recently been hampered as a result of extreme crude oil theft.
In October 2022, Umar I. Ajiya, the chief financial officer (CFO) of the Nigerian National Petroleum Corporation (NNPC) Limited said Nigeria loses $150million in revenue every other day from pipeline vandalism and sideline production, hampering Nigeria’s chances of gaining from the era of high oil prices.
Fighting oil theft: However, the federal government would later hire the services of ex-Niger Delta militant, Government Ekpemupolo, also known as Tompolo to expose all illegal exploration and production activities in the Niger Delta region, which has led to significant progress. The minister of state for petroleum resources, Timipre Sylva had earlier said the government was involving host communities, the armed forces, and the operating companies in the fight against crude oil theft.
According to SNEPCo’s statement, Bonga FPSO was supposed to be shut down for 30 days, to carry out statutory inspections, recertification, and other critical asset integrity restoration activities. However, the operations were completed 22 days ahead of schedule.
The Bonga Floating Production, Storage and Offloading (FPSO) vessel, which began production in 2005, also has a capacity of 150 standard cubic feet (scf) of gas export per day.
- As of 2020, Bonga FPSO had produced about 880 million barrels of oil.
- The FPSO improved its production capacity from 85% in 2018 to 94% in 2019. SNEPCo’s production in 2019 rose to 164,000 barrels of oil equivalent per day (boe/d) from 158,000, and this was largely due to Bonga.
- As of 2020, SNEPCo contributed around 22% to Shell’s global deepwater oil production
For the record: The Bonga FPSO has a processing capacity of 225,000 barrels of oil equivalent per day (beeps) and a storage capacity of 2 million barrels of oil. The facility was shut down on October 18, 2022, for turnaround maintenance (TAM).
