Nigeria, others bring OPEC production down, below expected target

The inability of Nigeria and other members of the Organisation of Petroleum Exporting Countries (OPEC) to pump enough crude oil has resulted in the overall failure of the group to meet its target production for December 2021, according to a survey.

The 13-member countries of OPEC and its allies led by Russia pumped some 620,000 barrels of oil per day below their combined quota, the survey showed while a survey by S&P Global Platts showed that OPEC’s overall compliance stood at 116.5 per cent for the month with Nigeria’s compliance at 239 per cent.

One of the secondary sources stated that whereas the target for Nigeria was 1.67 million barrels per day for the month, it only produced 1.44 million barrels per day in December and 1.49 million barrels per day in November.

The development widened the gap between the production quotas set by OPEC and its allies and their actual production.

Nigeria has been struggling to meet the quota allocated to it by OPEC but ageing infrastructure caused by years of under-investment in the upstream of the oil and gas sector has made it difficult for the country to achieve its target.

Sabotage caused by vandalism, technical issues, as well as difficulties with restarting oil wells the country shut down last year in the heat of the Covid-19 pandemic, have worsened the challenges.

But despite the limitation, the largest individual increase in production was in West Africa, where Angola boosted output by 90,000 bpd to 1.2 million bpd. Although this was the highest monthly level in 2021, Angola was still 190,000 bpd below its December quota.

West Africa also saw the biggest individual decline last month, with Nigerian output tumbling and defying state-owned Nigerian National Petroleum Corporation (NNPC) Group Managing Director, Mallam Mele Kyari’s forecast that the country would reach its target by the end of last year.