Nigeria's stocks sustain gain, helped by Seplat oil output recovery

Forcados usually exports up to 240,000 bpd, bring the West African country back to around the 1.8mn bpd level which the government wanted to achieve prior to joining the OPEC output cuts.

One of the leading independent oil and gas exploration and production company, SEPLAT Petroleum Development Company Plc, has blamed the volatility in global oil prices and the shut-in and declaration of the force majeure at the Forcados terminal as the reasons it performed poorly in 2016.

A spill that occurred on February 14, 2016 on the subsea crude oil export pipeline, had forced Shell to declare force majeure on Forcados liftings a week later.

He commended the government and securities agencies for their supports in ensuring the repairs of the pipelines stressing that the reopening of the crude export terminal will further improve the prospect of meeting the 2.2 million barrel per day (bpd) export target of the government.

"The world remains awash with oil, and additional barrels continue to reach the market", he said. Shipments this month will average about 250,000 barrels a day, according to a loading program obtained by Bloomberg.

At the beginning of June, shipping data from Platts showed that two Suezmax tankers set off from Forcados in the last days of May, in what was seen as a tentative test of the waters, as it were. The grade pumped an average of about 200,000 bpd in 2015, before the militancy escalated.

While the return of Forcados may be good news for Nigeria, it represents a new headache for OPEC.

The Organization of Petroleum Exporting Countries (OPEC) and some other non-OPEC producers again last month agreed to extend output cuts till next year March.

Counting Nigeria and Libya, total OPEC oil output remained about 450,000 barrels a day above the target set out in the November 30 production agreement and further extended in last month's meeting, putting the group only about 66 percent of the way toward its goal, compared with 90 percent in April, according to data compiled by Bloomberg. Libya and Nigeria contributed most of those gains while the 11 countries bound by the output caps were fully compliant with their pledges last month, just as they were in April, the survey showed.

Brent crude was up 43 cents (€0.38) by 0900 GMT at $48.49 (€43.16) a barrel, having fallen 4% the day before, while USA crude futures rose 38 cents (£0.34) to $46.10 (€41.03) a barrel.

  • Zachary Reyes