OIL production shut-in in Nigeria, earlier put at one million barrels per day has reached 1.3 million barrels per day. The surge in the country’s crude losses has been attributed to the strike embarked upon by workers of American firm, ExxonMobil and attacks on Shell’s facilities by gunmen.
For calling on workers to shut down oil facilities to check alleged looting by public officials, the Federal Government has cautioned former NLC president, Mr. Adams Oshiomhole.
Minister of State for Energy (Petroleum) Mr. Odein Ajumogobia had told The Guardian last month that the total oil shut-in as a result of crisis in the Niger Delta region was one million barrels per day.
At the first quarter press briefing in Lagos, the director of the Department of Petroleum Resources (DPR) Mr. Tony Chukwueke said that the 800,000 million barrels produced by ExxonMobil were being affected by the strike.
The Guardian however learnt yesterday that the current shut-in as a result of the industrial crisis in Exxon-Mobil hovers around 200,000 barrels per day while in Shell facilities, the country is losing 169,000 barrels per day.
Nigeria, which has been forced to shut in more than half of its oil output following militants’ attacks and a workers’ strike, could lose its position as Africa’s top oil exporter, analysts and traders said yesterday.
At the international oil market, the crisis in Nigeria and strike by refiners in the United Kingdom (UK) have pushed the prices for May oil delivery to near $120 per barrel.
The cumulative oil production cut-back in Nigeria now stands at over 1.3 million barrels per day from its most recent output of about two million bpd.
Total output coming from both Mobil Producing Nigeria Unlimited and Esso Exploration and Production Company Limited have been put at 760,000 barrels per day, being the second largest oil producing firm in the country.
Shell said last week it had shut 169,000 bpd of its production following repeated attacks by gunmen in the Niger Delta, where most of Nigeria’s oil is produced.
On Monday, militants claimed Shell’s shut-ins amounted to 350,000 bpd.
Chukwueke said yesterday that the ExxonMobil strike should be resolved if the country is to remain top among oil producers in the world.
According to him, the strike must be treated as a matter of national importance as the situation coupled with the various shut-ins would portray Nigeria in a bad light to the international commitment.
He explained that the company at present produces about 800,000 barrels of crude per day, adding that about 200,000 barrels had been lost due to the recent attacks on Shell’s Bonny facilities and other shut ins caused by activities of militants.
“Technically speaking, the country has a capacity to produce over two million barrels of crude per day, but recent problems in the Niger Delta has affected us from meeting this target,” he said.
“Besides, it is time for us to treat the recent problems in ExxonMobil as a national issue as failure to do so connotes danger for us as producing nation. ExxonMobil is a very important player in the production sector and a failure to nip the problem there in the bud would amount to the country losing over one million of our total capacity,” he said.
On the 2007 bid for oil blocks Chukwueke said the yet-to-be signed production sharing contracts of about 17 companies would be endorsed by government soon.
Reviewing the department’s activities in the first quarter of 2008, he said the department received over 1,059 applications from companies seeking permits to operate in the sector, adding that five of them were denied due to some irregularities such as forged documents and lack of expertise.
In Abuja, Labour Minister, Dr. Hassan Lawal warned Oshiomhole against inciting Nigerians against government.
Oshiomhole had told delegates to the second Triennial Delegates Conference of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) that:
“I want to suggest as your own friend and comrade that one of the resolutions that you should pass in this forum is that you have no business extracting more crude oil at $120 per day if the proceed will be shared by an irresponsible political leadership.”
The Action Congress (AC) governorship candidate in the April 14, 2007 election in Edo State, stated further that PENGASSAN should join forces with other Nigerians to prod President Umaru Musa Yar’Adua to probe his predecessor, Olusegun Obasanjo over alleged large scale fraud in the oil sector.
“I want to suggest to you that one of your resolutions is that you will join forces with all other Nigerians who have been visited with darkness, whose businesses have been ruined all those that have been retrenched as a result of the hostile production environment because of the incompetence of the defunct National Electricity Power Authority (NEPA) now Power Holding Company of Nigeria (PHCN) that we know who ruined NEPA, I want us to rise together to devote today to join the resolution already passed by the NLC that Obasanjo must account for the money he has stolen,” Oshiomhole said.
But Lawal, who represented Yar’Adua at the event took exception to the statement, saying the plundering of state resources was not perpetrated by the present government and as such it should not be saddled with a needless crisis.
Lawal said with the sure footed approach to governance and commitment to the rule of law by the present administration there was no basis to cripple the economy using PENGASSAN’s awesome power.
The minister explained that shutdown of oil installations was not the solution to the crisis in the sector but the best approach was meaningful dialogue.
“Since Oshiomhole believes that the Yar’Adua government is making progress and changing many misdeeds of the Obasanjo administration, he should allow the workers to give Yar’Adua a chance because if we stop the drilling of oil, we will not be helping the administration,” Lawal counselled.
Oshiomhole later recanted his earlier statement, saying he only called out workers to protest the large scale fraud in the industry and the probe of the former President.
He said he was misquoted by the Minister and insisted that all he said was that one of the resolutions of the conference should be that: “You will join forces with all other Nigerians who have been visited with darkness, whose businesses have been ruined, all those that have been retrenched as a result of the hostile production environment because of the incompetence of NEPA now that we know who ruined NEPA, I want us to rise together to devote today to join the resolution already passed by the NLC that Obasanjo must account for the money he has stolen.”
Earlier, PENGASSAN President, Peter Esele, listed his achievements while in office to include negotiation of better working conditions for members of the union, fight against expatriate quota and the reversal of contract and casual staffing.
He said the Petroleum Training Institute should be upgraded to achieve local content policy of the Federal Government.
On the of Niger Delta crisis, Esele expressed dismay at the growing rate of insecurity in the region, adding that early resolution of the crisis was key to the development oil and gas industry in Nigeria.