NNPC exporting 4.7 million barrels of new crude to Spain, U.S.

•Eyes 80,000 bpd in 2025 as market volatility continues
•Lokpobiri hails gains at FPSO as output may hit 100,00bpd

About 4.7 million barrels of Nigeria’s latest blend of crude oil is being exported to Spain and the United States in about seven cargoes as market volatility continued yesterday due to crude inventory build-up.

The new Utapate crude oil blend, the Nigerian National Petroleum Company Limited (NNPC) said yesterday, was introduced into the global market, tagging it a landmark achievement.

Announced during the Argus European Crude Conference in London, the Managing Director of NNPC Exploration and Production Limited (NEPL), Nicholas Foucart, described the launch as a milestone for Nigeria’s oil sector, saying it would enhance crude exports and revenue generation.

Foucart revealed that the Utapate field, located in the Oil Mining Lease (OML) 13, has rapidly ramped up production since May 2024, achieving 40,000 barrels per day (bpd). He added that the output would hit 80,000 barrels daily by late 2025.

According to him, five cargoes, carrying about 4.7 million barrels have been exported while another two are planned to bring the projected export to 4,750,000.

On Wednesday, the U.S. Energy Information Administration (EIA) reported an inventory build of 500,000 barrels for the week to November 15, a development which in the early hours of the day pushed back on prices with Brent trading at $73.26 per barrel and WTI at $69.50 per barrel.

But the prices inched slightly higher at the time of writing this report as Brent stood at $73.44 per barrel and WTI at $69.70 per barrel.

While the price of oil remained volatile, Nigeria’s 2025 budget is benchmarked at $75 per barrel with a production projection of 2.06 million barrels.

Last, NNPC reported that the country’s production has already moved to 1.8 million barrels per day although the country’s OPEC outlook for 2025 is about 1.5 million barrels per day.

In July 2024, NNPC and its partner, the Sterling Oil Exploration & Energy Production Company (SEEPCO) Ltd introduced the Utapate crude oil blend, following the lifting of the first cargo of 950,000 barrels which headed for Spain.

“Since its debut, we have exported five cargoes, largely to Spain and the U.S. East Coast. Two additional cargoes are scheduled for November and December 2024,” Foucart stated.

He emphasised the blend’s positive reception due to its low sulphur content and high-quality yield.

The Utapate field, currently producing 40,000 bpd, is expected to reach 50,000 bpd by January 2025, with a target of 80,000 bpd by the year’s end, Foucart said.

OML 13, where the new blend is coming from boasts 330 million barrels of crude oil reserves, 45 million barrels of condensates, and 3.5 trillion cubic feet (tcf) of gas.

The field’s development included converting facilities from swamp/marine to land-based operations and constructing infrastructure such as production facilities, pipelines, and an offshore loading platform.

The Utapate crude grade, similar to Nembe and Amenam blends, NNPC said, is highly sought after for its low sulphur content (0.0655 per cent) and light sweet composition.

Managing Director of NNPC Trading Limited (NTL), Lawal Sade, said its pricing structure is competitive and designed to optimise value for producers and international refiners.

NNPC said it plans to establish term contracts to ensure a steady supply of Utapate crude to European and U.S. refiners. Its sustainable production practices, including flare gas elimination, align with global environmental standards, appealing to environmentally conscious buyers.

Meanwhile, Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has commended the rising crude oil production from Abigail Joseph Floating Production Storage and Offloading (FPSO) facility, operated by the NNPCL-First E&P Joint Venture on OML 83/85.

Currently producing 60,000 barrels per day (bpd), the FPSO, Lokpobiri said is on track to achieve 70,000 bpd in the near term, with plans to scale up to 100,000 bpd.

Speaking at the site, Lokpobiri emphasised the strategic importance of the facility, stating: “The ongoing work here reflects our collective efforts to increase Nigeria’s crude production. It is impressive to see such commitment from NNPCL and First E&P, especially as First E&P pursues a 23-well drilling campaign to sustain and enhance output. This is a vital step toward achieving our national production targets.”

Managing Director and CEO of FIRST E&P Limited, Ademola Adeyemi-Bero, reaffirmed the company’s dedication to delivering results.

“We are fully committed to meeting and surpassing our current production goals. With the support of our partners and ongoing de-bottlenecking initiatives, we are confident of achieving 70,000 bpd and eventually 100,000 bpd in record time. This project underscores the capability of indigenous companies to deliver on ambitious targets,” he noted.

Chief Upstream Investment Officer (CUIO) of NNPC Upstream Investment Management Services (NUIMS), Bala Wunti assured the Minister of the joint venture’s alignment with national objectives.

“The milestones achieved here at Abigail Joseph FPSO are a testament to NNPCL’s determination to deliver results through strategic partnerships and innovative approaches. With the stir of the GCEO We are committed to meeting the Minister’s directive to ramp up production in no distant time,” Wunti said.