Despite its perennial underproduction in the last two years, Nigeria was able to increase crude oil output compared to its budget benchmark from 60% to 75% between H2 2022 and Q1 2023, according to data released by the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
An analysis of production data by Nigerian media, THISDAY revealed that, despite a federal budget projection of 1.88 million barrels per day crude oil production in 2022, Nigeria under-produced the commodity by over 277 million barrels between January and December 2022, leaving average production at 60%.
However, with a renewed zeal to combat oil theft and asset vandalism in the Niger Delta, the country has now managed to drill 115 million barrels of the commodity in the first quarter of 2023, raising the average to 75%, a 15% increase.
Regardless of an improvement over last year’s drilling, Nigeria struggled to produce 39 million barrels, 36.5 million barrels, and 39.3 million barrels in the first three months of this year, from January to March.
When condensate, which is not included in the Organisation of Petroleum Exporting Countries (OPEC) calculation, is included, the country’s total output for the period jumps to 136.6 million barrels in the first three months of 2023.
When compared to the OPEC quota of 1.8 million, Nigeria’s production percentage fell, with the country only able to produce about 70% of its OPEC quota in Q1 2023.
However, it is, a significant improvement over the estimated 60% it drilled in the majority of 2022, when output fell to a record low.
The majority of the oil came from increased production at Forcados, which produced 6.8 million barrels, 6.9 million barrels, and 5.7 million barrels in the first three months of the year, respectively.
Nevertheless, the situation worsened in 2022, with Nigeria’s crude oil production falling short of its expected output of 1.88 million barrels per day by a whopping 283 million barrels, amounting to roughly $24.55 billion, as previously reported by THISDAY.
This figure was calculated by multiplying the 283 million barrel deficit recorded during the period by an estimated conservative price of $85 per barrel for which the commodity sold in the year under review.
Due to its inability to drill only 60% of its expected volume in 2022, the country lost roughly 40% of its output to oil theft and sabotage because of the incessant shut-in of planned output for the period.
A review of NUPRC data for the entire year 2022 revealed that Nigeria only drilled 43.3 million barrels in January, which turned out to be the highest output for the year; 35.2 million barrels in February; 38.3 million barrels in March; and 36.5 million barrels in April.
It fell to 31.7 million barrels in May, then slightly increased to 34.7 million barrels in June before falling to 33.6 million barrels in July last year.
In August, Nigeria produced 30.1 million barrels, compared to the projected 58.2 million barrels; in September, Nigeria’s output fell to a multi-decade low of 28.1 million barrels; and in October and November, Nigeria drilled 31.4 million barrels and 35.5 million barrels, respectively.
The year was one of the worst in the country’s history, with the country consistently failing to meet its OPEC quota. However, recent output data show that there has been some recovery.
Source: Energy Ghana