Nigeria to restore oil output as OPEC weighs extending cuts
Nigeria will revive oil production this summer as it completes maintenance and repairs, and expects fellow OPEC members to continue to cut their output in the second half of the year, Oil Minister Emmanuel Kachikwu said.
Africa’s second-biggest producer will finish repairs on the Forcados pipeline by June and complete maintenance at the Bonga oilfield the following month, Kachikwu said in a Bloomberg Television interview. The country’s output slumped to 1.27 million barrels a day last month, the lowest in decades, according to data provided by the nation. It aims to reach 2.2 million barrels a day.
With production losses due to militant attacks, Nigeria had been exempt from output cuts by the Organization of Petroleum Exporting Countries. The nation will join the OPEC measure once it has fully restored output it’s lost, which could happen as early as October or November, and meanwhile expects the counterparts to extend the cuts to keep oil prices above $50 a barrel, Kachikwu said.
“I’m not sure we have an alternative, we’ve got to,” Kachikwu said. “There’s a lot of energy around a six-month extension,” which should be “easy” to agree when ministers meet in May.
Maintenance reduced Nigeria’s output in March by 250,000 barrels, he said. Having been spared from militant attacks for three months, the country’s focus for boosting output is shifting away from security threats toward fiscal issues, he said.
The country’s long-delayed Petroleum Industry Governance Bill, which seeks to reform how the industry is regulated and funded, will be presented to lawmakers for consideration later this month. Nigeria will also begin pay back a $5.1 billion debt owed to international companies including Exxon Mobil Corp. and Total SA this month.