Shell Nigeria, the operator of Bonny export terminal, has placed limits on the export of Bonny Light, Nigeria’s premium crude oil, Naija247news understands.
A source close to the company and shipping schedule, told this Newspaper that the peg was due to the Trans Forcados pipeline which resumed exports last month after months of shutdown.
According to him, Shell wants Forcados to recover from the long term shutdown. Nigeria’s production is recovering after Shell lifted restrictions on shipments of Forcados crude oil, a key export grade, following a disruption that lasted 472 days.
The return of Forcados may add as much as 250,000 barrels a day of light and sweet crude into the Atlantic.
While Shell subsequently placed limits on shipments of Nigeria’s Bonny Light crude, the return of Forcados occurs just as local refiners are overwhelmed with similar grades from the US, North Sea and Africa, our source said.
If Nigeria does not quickly regain its market share, similar products, particularly from the US shale producers, might soon replace it, the source added. The source, however, did not disclose how many barrels are being limited from export.
Nigeria’s oil production will soon hit 1.8 million barrels per day due to Forcados coming back on stream.
According to a statement issued by Shell last month, Nigeria’s oil exports is now back fully for the first time in 16 months since its shutdown.
However, the down-turn for Nigeria would be its joining of OPEC cut deal once production hits the 1.8mbpd target.
OPEC producers agreed last month to extend output cuts of about 1.8 million bpd until March 2018. Forcados had been under force majeure since February 2016 after a militant attack on it.
In our earlier report, SweetcrudeReports gathered that TFS resumed sometime between May 15 and 20, 2017, but most companies involved have been quiet about it. The facility is being operated by Shell, and ten Nigerian independents: Seplat, Elcrest, Shoreline, Neconde, Shell Petroleum Development Company, Pan Ocean, NDWestern, Pillar, Midwestern, Energia and Platform.
Until it was shut down in February 2016, Forcados was the only pipeline through which the likes of Seplat, Elcrest, Shoreline, Neconde, Pan Ocean and NDWestern, exported their products. However, the likes of Pillar Oil, Midwestern, Energia and Platform Oil, used it as a secondary export line.
Within the period that the shut-in lasted, we gathered that Seplat, Elcrest, Neconde and Shoreline, had sourced for alternative routes of exporting like through shipping.
Forcados came back up last November, nine months after the original blast, but it was immediately vandalised again, by oil militants.
When contacted for comments on the placement of limits on Bonny Light exports, one of the company’s spokesmen, declined comments, saying: “We don’t comment on loading schedules.”