Crude oil production transported through the Trans-Niger Pipeline (TNP) into the Bonny terminal did not record any losses in May, a significant development considering that over 400 illegal connections were removed on the line in April.
Analysts say this shows the government’s reforms including engaging private security and ramping off security measures and engagement with host communities may be bearing fruit.
“The fact that the month of May recorded zero incidences of pipeline transportation on Shell’s 28-inch Trans Niger Pipeline from flow stations in Rivers & parts of Bayelsa State is proof that the Task Force set up by the President to investigate coordinated crude oil theft is working,” said Kelvin Emmanuel, energy sector expert and co-founder/CEO at Dairy Hills.
The Trans Niger Pipeline (TNP) is considered one of Nigeria’s biggest oil pipelines. It is a major crude oil transportation pipeline in the Niger Delta region, which is known for its significant oil reserves. The Trans Niger Pipeline is operated by the Shell Petroleum Development Company and the Nigerian National Petroleum Company Limited (NNPC) and spans approximately 180 kilometers (112 miles).
The TNP is an important infrastructure for transporting crude oil from oilfields in the Niger Delta to export terminals, primarily the Bonny Export Terminal. It has the capacity to transport over 450,000 barrels of crude oil per day, contributing significantly to Nigeria’s oil production and export.
Data from the Nigerian Upstream Petroleum Regulatory Commission shows that oil production (crude oil and condensate) via the Bonny Terminal increased by 24 percent from 3.0 million barrels in April to 3.72 million barrels last month.
The TNP is a major pipeline that transports about 180,000 barrels of crude per day to the Bonny export terminal. The Bonny terminal, a major onshore crude oil terminal, has a 5.7-million-barrel capacity.
Osagie Okunbor, managing director of Shell Petroleum Development Company of Nigeria (SPDC), at an oil and gas conference in April, said the company detected and removed 460 illegal connections on the Trans Niger Pipeline (TNP) before resuming operations after a one-year shutdown.
Etulan Adu, an oil and gas production engineer said the improved output was due to pipeline intervention works, curbing bunkering and oil theft activities along the line, as well as increasing injection from producing companies and third-party injectors to the terminal.
“These factors have a direct relationship and impact on volumes. Being intentional about this would go a long way in maintaining it. The Policy Advisory Council is apt on the nation sending out a strong signal that it’s not business as usual with regards to insecurity,” said Jide Pratt, chief operating officer of Aiona and country manager of Trade Grid.
With a capacity to handle significant volumes of crude oil, Bonny Terminal has been a critical component of Nigeria’s oil industry for years.
Despite its importance, the terminal has faced numerous challenges in the past, including attacks and disruptions that have led to force majeures, significant losses and disruptions in oil production.
In August last year, Mele Kyari, group chief executive officer, of Nigerian National Petroleum Company (NNPC) Limited said Nigeria was losing 95 percent of oil production at the Bonny terminal due to oil theft.
This was the period when Nigeria produced less than 1 million barrels per day, due to heightened oil theft and vandalism.
This is the pipeline it uses to evacuate crude from oil fields in rivers and parts of Bayelsa to the Bonny crude oil export terminal, as other international oil companies lamented the grave impact of oil theft on their operations.
To combat these challenges, Pratt said that engagement in the oil and gas sector, military task force reforms, and key performance indicators are pertinent.
“With this in place, the government will send a clear investment climate to sustain this. The ministry and the NNPC Ltd must now be run by competent staff so that we have a constant and consistent way which is up,” Pratt said.
Adu added that strong collaboration with all government agencies, producing companies, community stakeholders and on-stream of some facilities that were shut down will increase and maintain production in the major terminal.
Source: BUSINESSDAY
