Shell’s Forcados oil export terminal in Nigeria has begun operating after a prolonged force majeure of over a year following a string of militant attacks. According to Bloomberg data, the terminal will load some 250,000 bpd, which is more than a tenth of Nigeria’s current output. Forcados’ daily loading capacity is 400,000 barrels.
The news would not make the rest of OPEC happy: international oil prices have stubbornly remained around US$50 a barrel despite an agreement to extend production cuts until the end of March 2018. Nigeria, like Libya, is exempt from the cuts and has made no secret of its plans to ramp up production to more than 2 million bpd, boosting its production capacity to 2.5 million bpd over the next three years.
The news came days after OPEC’s production data, as surveyed by Reuters, revealed that the cartel’s output had actually increased in May, for the first time since the start of the year, despite an improvement of compliance with the cut deal thanks to lower production in Angola and Iraq. During the same month, however, output in Nigeria and Libya rose, adding a quarter of a million bpd to overall OPEC production, which stood at 32.22 million bpd during the month.
Recent data from OPEC showed that Nigeria pumped an average 1.51 million barrels daily over the first quarter of the year, based on information from secondary sources.
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 news was reported a month after Shell said it was testing the Trans Forcados pipeline, which feeds crude into the terminal, and which was the primary target of Niger Delta Avengers’ attacks that caused the force majeure at the terminal.
By Irina Slav for Oilprice.com