Nigeria’s crude oil output and revenue is set to increase by 150 000 bpd and US$ 16.05 million as Shell Petroleum Development Company of Nigeria Limited (SPDC) reopened a section of its Trans Niger Pipeline (TNP).
Shell had shut the TNP in July, following a leak on the Bomu-Bonny section at Owokiri, which was found to be caused by a 6 in. crude theft valve placed on the line. The shut down came just days after Shell re-opened the line following an explosion and fire in June at a point that had been targeted by oil thieves at Bodo West in the Niger Delta’s Ogoniland.
TNP loss
In July, the Shell Petroleum Development Company stated that the total daily loss from the TNP shutdown was approximately US$ 15 million. The closure of the line also hit Nigeria’s domestic power generation, with SPDC being forced to shut down the Afam VI power plant due to a shortage of gas arising from the closure of the pipeline.
According to a statement by Precious Okolobo, spokesperson for Shell, the reopening was a result of the completion of repair work in the 28 in. section of the TNP. The 24 in. section, which was shut on 9th October following leaks, remains closed. Oklolobo noted that the force majeure that was declared on Bonny light exports on the 9th October will be lifted as soon as possible.
Oklogobo added that the company has taken responsibility for the oil spill in Nowa and blames it on equipment failure. He said, “We are also investigating the root cause of this pipeline failure with a view to learning the appropriate lesson, and remediation are being planned and we are going to carry them out, compensation payment will follow immediately.’
Naira to stabilise
According to analysts at Cowry Asset Management Limited, the re-opening of the Trans Niger pipeline will stabilise the naira.
After trading on Friday, the naira strengthened slightly against the US dollar gaining No.03 kobo at the inter-bank market.
Edited from various sources by Hannah Priestley-Eaton