Oil production dips 225,000bpd over Shell’s Bonga closure

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By Adewale Sanyaolu with agency report

Despite recent peace moves by the Federal Government to engage with Niger Delta militants on modular refineries, Nigerian troops operating under the “Operation Delta Safe” taskforce yesterday said they have destroyed 80 oil refineries in the restive Niger Delta region in the last 10 days.

The government has been holding talks with militants to end attacks on oil production facilities using the scheme as a bait to stave off fresh attacks from the agitators.

But a military crackdown on thousands of illegal refineries in the southern swamps, which process crude oil stolen from oil majors and the Nigerian National Petroleum Corporation (NNPC), has raised tensions around the Niger Delta in recent times.

Illicit refineries process stolen crude in makeshift pipes and metal tanks hidden in oil-soaked clearings deep in the southern swampland’s thick bush land.

“Troops of joint Operation Delta Safe have intensified raids operation against crude oil theft with destruction of 80 illegal refineries across Bayelsa, Delta and Rivers states,” said military spokesman, Abubakar Abdullahi. “Our troops would not relent until our mandate is achieved,” he added.

His comments contrast those made in February by Vice President Yemi Osinbajo who said Nigeria must engage with illegal refiners by establishing modular refineries so that they can participate in legal refining.

Meanwhile, crude oil production in Nigeria could suffer about 225,000 barrels per day (bpd) cut as Shell Nigeria Exploration and Production Company Limited (SNEPCo) announced the commencement of turnaround maintenance at Bonga deep-water field.

SNEPCo in a statement explained that the maintenance at Bonga will create room for executing statutory activities that will ensure continuous optimum operations at the deep-water field, which began producing in November 2005. Production from the field was shut down on March 4, 2017, and is expected to resume at the conclusion of the exercise next month. 

“This is the fourth turnaround maintenance since Bonga began production. The exercise will help ensure sustained production and reduced unscheduled production deferments. For the Bonga team, this is another opportunity to excel, having won the ‘Asset of the Year’ Award 2016 in the Shell Group, followed by runners-up in Norway and Malaysia.

“We are pleased that the award recognised the continuing collaboration towards optimum production with a focus on safety, cost and Nigerian content development, which will be invaluable in the maintenance work,’’ said Managing Director of  SNEPCo, Bayo Ojulari.

The turnaround maintenance involves inspections, recertification, testing and repair of equipment as well as engineering upgrades with Nigerian companies and subsea professionals playing key roles. A major focus is the Bonga floating, production, storage and offloading (FPSO) vessel, which is at the heart of Bonga operations. The Bonga FPSO has the capacity to produce 225,000 barrels of oil and 150 million standard cubic feet of gas per day.

Bonga is Nigeria’s first deep-water development in depths of more than 1,000 metres, and is located 120km offshore Nigeria. SNEPCo expanded the project with further drilling of wells in Bonga Phases 2 and 3 and through a subsea tie-back that unlocked the nearby Bonga North West field in August 2014. Bonga Phase 3 achieved first oil in October 2015.

SNEPCo operates Bonga in partnership with Esso Exploration and Production Nigeria (Deep Water) Limited; Total E&P Nigeria Limited and Nigerian Agip Exploration Limited under a production sharing contract with the Nigerian National Petroleum Corporation (NNPC).

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