Published: Monday, 2 Mar 2009
The effects of the lingering crisis in the Niger Delta has continued to bite hard on the Anglo- Dutch oil major, Shell Petroleum Development Company, as its crude oil production in Nigeria has dropped to 320,000 barrels per day.
Investigations by our correspondent showed that SPDC, which produced as much as 1.2million bpd before the crisis in the Niger Delta assumed a worrisome dimension in 2004, was currently producing 320,000 bpd as at Friday.
Reliable sources in the oil firm told our correspondent on Sunday that the eastern operation of the company with its headquarters in Port Harcourt was producing 120,000 bpd of crude oil as at Friday.
Similarly, the sources disclosed that the company‘s western operation, with headquarters in Warri, was producing 200,000 barrels of crude oil per day as at the close of work on Friday.
The source, who said the management of the Anglo-Dutch oil firm was not comfortable with the development, blamed the downward trend on the worsening security situation in the region, which had led to the shut down of some major production platforms and vandalism of strategic delivery lines.
Specifically, sources attributed the poor crude oil production from the eastern operation of SPDC to the vandalism of the Nembe trunkline, which channels crude from the flow stations and platforms to the loading terminal before it was ruptured by suspected militants in the region.
Also, the re-entry into shut platforms and flow stations in the western zone of SPDC was being hampered by the difficulty in replacing vandalised and stolen flow lines in the coastal oil fields in the area.
It will be recalled that the General Manager, Production, SPDC, West, Mr. Cor Zegelar, had said that over 56,000 kilometres of pipelines were uprooted and carted away in the zone by warlords in the heat of the crisis.
Our source said, ”Shell is producing 320,000 barrels of crude oil per day in Nigeria as at last Friday. This figure represents 200,000 barrels per day in the western division in Warri and 120,000 barrels per day in the eastern operation in Port Harcourt. The current production strength of the company is a far cry to the 1.150million barrels of crude oil per day that was attained by the company in 2004.
”Our (SPDC) predicament is not unconnected with the precarious security situation in the Niger Delta. Some major production platforms have been shut and a number of flow lines were vandalized. In some cases the crude oil pipes are uprooted and carted away by these hoodlums. Take for instance, the blown up of the Nembe trunkline has frustrated optimal operation in the eastern axis.
”The Nembe trunkline is very strategic to service delivery by SPDC in the east because it services so many production platforms and deliver crude to the loading terminal. We cannot achieve much in the east until the Nembe trunkline is put in proper shape and secured against fresh attack.
”Most of the lines in the west were excavated and stolen by the militants leading to the closure of many production platforms in the area. The re-entry programme in the west is being frustrated by the process required in securing replacement for the stolen pipes.
”To receive any steel material after an order has been placed for it would take up to 18 months. You cannot just go to the open market and buy these strategic pipes. That is why the re-entry process in the west is slow. That is why the decision to abandon the locations during the crisis was heavily criticised. A lot of people believed that we should have remained there under tight security.
”Besides, we still have such issues as poor funding level and inadequate government support hindering effective operation,” added our source, who craved anonymity.
Consequently, our correspondent learnt that the management of the Anglo- Dutch oil firm had intensified cost cutting measures in order to stay afloat.
SPDC‘s spokesman, Mr. Precious Okolobo, in a telephone interview with our correspondent on Sunday, said it was not the style of the oil firm to discuss its production, adding that ”We do not give daily production updates.”
The effects of the lingering crisis in the Niger Delta has continued to bite hard on the Anglo- Dutch oil major, Shell Petroleum Development Company, as its crude oil production in Nigeria has dropped to 320,000 barrels per day.
Investigations by our correspondent showed that SPDC, which produced as much as 1.2million bpd before the crisis in the Niger Delta assumed a worrisome dimension in 2004, was currently producing 320,000 bpd as at Friday.
Reliable sources in the oil firm told our correspondent on Sunday that the eastern operation of the company with its headquarters in Port Harcourt was producing 120,000 bpd of crude oil as at Friday.
Similarly, the sources disclosed that the company‘s western operation, with headquarters in Warri, was producing 200,000 barrels of crude oil per day as at the close of work on Friday.
The source, who said the management of the Anglo-Dutch oil firm was not comfortable with the development, blamed the downward trend on the worsening security situation in the region, which had led to the shut down of some major production platforms and vandalism of strategic delivery lines.
Specifically, sources attributed the poor crude oil production from the eastern operation of SPDC to the vandalism of the Nembe trunkline, which channels crude from the flow stations and platforms to the loading terminal before it was ruptured by suspected militants in the region.
Also, the re-entry into shut platforms and flow stations in the western zone of SPDC was being hampered by the difficulty in replacing vandalised and stolen flow lines in the coastal oil fields in the area.
It will be recalled that the General Manager, Production, SPDC, West, Mr. Cor Zegelar, had said that over 56,000 kilometres of pipelines were uprooted and carted away in the zone by warlords in the heat of the crisis.
Our source said, ”Shell is producing 320,000 barrels of crude oil per day in Nigeria as at last Friday. This figure represents 200,000 barrels per day in the western division in Warri and 120,000 barrels per day in the eastern operation in Port Harcourt. The current production strength of the company is a far cry to the 1.150million barrels of crude oil per day that was attained by the company in 2004.
”Our (SPDC) predicament is not unconnected with the precarious security situation in the Niger Delta. Some major production platforms have been shut and a number of flow lines were vandalized. In some cases the crude oil pipes are uprooted and carted away by these hoodlums. Take for instance, the blown up of the Nembe trunkline has frustrated optimal operation in the eastern axis.
”The Nembe trunkline is very strategic to service delivery by SPDC in the east because it services so many production platforms and deliver crude to the loading terminal. We cannot achieve much in the east until the Nembe trunkline is put in proper shape and secured against fresh attack.
”Most of the lines in the west were excavated and stolen by the militants leading to the closure of many production platforms in the area. The re-entry programme in the west is being frustrated by the process required in securing replacement for the stolen pipes.
”To receive any steel material after an order has been placed for it would take up to 18 months. You cannot just go to the open market and buy these strategic pipes. That is why the re-entry process in the west is slow. That is why the decision to abandon the locations during the crisis was heavily criticised. A lot of people believed that we should have remained there under tight security.
”Besides, we still have such issues as poor funding level and inadequate government support hindering effective operation,” added our source, who craved anonymity.
Consequently, our correspondent learnt that the management of the Anglo- Dutch oil firm had intensified cost cutting measures in order to stay afloat.
SPDC‘s spokesman, Mr. Precious Okolobo, in a telephone interview with our correspondent on Sunday, said it was not the style of the oil firm to discuss its production, adding that ”We do not give daily production updates.”