Nigeria Loses N11 Billion Daily As Oil Exports Suffer
Following the declaration of force majeures on the grades, more than 700,000 barrels per day of production have been affected, denying the country a huge revenue, according to a report by Reuters on Thursday.
Nigeria relies heavily on earning from oil exports, and the recent production disruptions caused by militant attacks came as an additional headache for an economy that already suffers from the sharp drop in oil prices since 2014.
The nation’s crude oil production has fallen from an average of 2.2 million bpd to as low as 1.3 million barrels per day, the Federal Government has said.
According to the government, the plunge is primarily due to the destruction of oil and gas installations in the Niger Delta region, and it has decreased the country’s revenue by over 60 per cent.
The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, disclosed this on Thursday at the headquarters of the Nigerian National Petroleum Corporation in Abuja while explaining how the crash in crude oil prices and the militancy by agitators in the Niger Delta region had adversely affected the nation’s economy.
He said, “We are presently passing through very grave circumstances in Nigeria. Oil that was at a price of about $120 is at about $42 per barrel today. The price has continued to struggle and based on this element alone, the Federal Government has lost over 50 per cent of its income and so do the states.
“As if that wasn’t bad enough, the militancy itself has brought down production from an average of 2.2 million barrels to about 1.4 million barrels today. And if I discount what I’m seeing here today, it probably is about 1.3 million barrels. So, what this means is that when you take the cumulative effect of both pricing and militancy, we are down to more than 60 per cent drop in the income of this country.”
Kachikwu’s statements came as the Group Managing Director, NNPC, Dr. Maikanti Baru, urged the National Association of Petroleum Explorationists to explore the hydrocarbon potential of green frontier basins in order to increase the nation’s reserves, which were fast depleting.
Baru gave this charge when he received the leadership of NAPE led by its National President, Mr. Nosa Omorodion, at the NNPC Towers.