There is no doubt that Nigeria's continued loss of production has been a significant boost to oil prices. There also is little end in sight to the shut-ins that have taken so much oil off the market.
Platts' Africa correspondent, Jacinta Moran, with many years' experience covering that part of the world, has compiled the most accurate and complete list of the precise size of the outages. If you read various media accounts of just how much oil has been lost there, the estimates vary widely. But here is what we at Platts are using, based on Jacinta's research.
--54% of Nigeria's total shut-in production is off the market due to politically-driven community problems, and its total is 570,000 b/d. Some of the main fields affected by those issues include's Shell's production at Forcados, and the Brass field operated by Italy's ENI. This is 18% of Nigeria's total capacity.
--46% of the shut-ins are for operational problems that include the extent of vandalism on infrastructure, and those total 480,000 b/d. Shell's shut-in on the Nembe pipeline, for instance, is driven by problems, not by politics, and has taken 77,000 b/d of production offline.
--Those are total outages then of approximately 1.5 million b/d, out of total estimated capacity of 3.2 million b/d. Imagine how different oil markets might look if all of that capacity could be accessed. OPEC, which now has limited challenges in maintaining prices, given the tight spread between supply and demand, would have major issues to confront.
--There is little end in sight to the tension. Just today, an employee of Total was kidnapped. President Yar'Adua's decision to take direct control of the country's energy industry and appoint a former commercial lawyer with no experience in the oil and gas industry is unlikely to help stem the tide of violence in the oilpatch.
--Among some of the specific outages: production that feeds into the Forcados terminal is slowly coming back, and now stands at 25,000 b/d. Last year, Shell was forced to shut down around 477,000 b/d of oil production from fields in the western Niger Delta and suspend crude loadings from the terminal following attacks on its facilities.
--ENI's Brass shut-ins total 70,000 b/d.
--Chevron is still well below its total Nigerian output of 360,000 b/d, producing just 270,000 b/d. Most of that comes from the Escravos field.
--And force majeure is still in place at the Pennington terminal due to security problems, taking 46,000 b/d of output off the market.
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