NNPC Operations Records 60 Percent Growth in March

By June 13, 2017 Investment News

The Nigerian National Petroleum Corporation, NNPC, recorded over 60.19 per cent growth in its operations in March 2017, the national oil company’s latest financial and operations report shows.

The report published on Friday revealed that trading deficit, which has characterised the corporation’s operations for some time, as a result of massive disruption and sabotage of its facilities, recorded a huge drop from N14.12 billion in February to just about N5.62 billion.

The improvement was attributed to the increase in the Nigerian Petroleum Development Company, NPDC crude oil exports revenue by 86 per cent. NPDC is the upstream (exploration and production) arm of the NNPC.

Out of a total cumulative production of 15.7 million barrels from its ten production fields between February 2016 and February 2017, NPDC’s monthly average daily production for March stood at about 39.786 barrels.

NPDC, which is projected to ramp-up production level to about 250,000 barrels per day, currently accounts for 2.23 percent of total national production

Group operating revenue for the month rose from N318.29 billion in February to N354.65 billion, about 149.27 percent, compared with operating expenditure, which grew from N332.41 billion in February to N360.2 billion about 171.77 percent of budget.

The report said the corporation remitted a total of N1.413 trillion between March 2016 and March 2017, including the final tranche of the 32 instalments of N6.33 billion monthly refund to the federal government of N450 billion oil revenue illegally withheld in 2011.

Out of net domestic crude oil receipt of N132.5 billion, the report said N88.49 billion, including N2.46 billion from gas receipts, was transferred to the Federation Account, while the balance of N46.46 billion was used to fund the joint venture cash call account as the cost of production.

Although total crude oil export sale stood at $361.95 million for the month, which is about $98.84 million higher than February performance, crude oil sales contributed $255.5 million, or 70.59 percent of dollar transactions, compared with $157.65 million during the previous month.

Details of the report showed that about 228.32 million barrels of crude were lifted by the NNPC on behalf of the federal government, out of 703 million barrels fiscalized during the period, while 197 billion cubic feet, BCF, of gas was sent to power plants to generate a total 2,284 megawatts, MW of electricity.

A total of 226.9 billion cubic feet of natural gas were produced in March 2017, translating to about 7,319.58 million standard cubic feet per day.

A breakdown of the gas component of the report showed that about 135.46 BCF, or 59.87 percent, was commercialised, comprising 34.38BCF for domestic and 101.07 BCF for export, with about 40.13 percent either re-injected, used as upstream fuel gas or flared.

“Gas flare was 9.49 per cent for the month of March 2017, or 692.49 million standard cubic feet per day, MSCF/D, compared to the gas flare rate of 9.74 per cent, or 680 MSCF/D for March 2016 and March 2017,” the report said.

Besides, about 1,109.18 MSCF/D of gas was supplied to the domestic market during the month, with average daily gas supply to power plants increasing to 689.19 MSCF/D, or 62.14 percent utilised for gas-fired power plants to generate 3,056 MW of electricity, compared to 582 million standard cubic feet per day recorded in February.

The balance of 419.99 million standard cubic feet per day or 37.86 percent was supplied to industries.

Pipeline sabotage by vandals continued to be the major challenge negatively impacting on NNPC’s overall performance, with the report indicating that a total of 2070 vandalised points was identified between March 2016 and March 2017.

During the month, the report said downstream pipeline vandalised points increased from 49 in February to 94 in March 2017, representing 91.84 percent increase relative to the previous month, despite Federal Government and NNPC’s continuous engagement with stakeholders in the Niger Delta region.

The sabotage incidents, which affected the company’s production, the report said included production shutdown of Trans Niger Pipeline and Nembe Creek Trunk Line due to pipeline leakages; shutdown of Bonga Terminal for turnaround maintenance, and existing Force Majeure declared by the Shell Petroleum Development Company, SPDC, following the vandalism on its 48-inch Forcados crude oil export line.

The report said NNPC’s deferred production revenue caused by pipeline sabotage averaged N20 billion per month.

 Source: Premium Times