Nigeria’s overall crude oil production in 2022 was short by 283millon barrels, with a market value of about $24.55billion. Nigeria’s expected output for year was 1.88 million barrels per day.
This figure was achieved from a conservative estimated price of $85 per barrel for which the commodity sold in the year under review, is multiplied by the 283 million barrels deficit recorded during the period.
From data provided by the NUPRC, while the 2022 budget projected a 1.88 million bpd, that is about 58.28 million barrels every month or an estimated 700 million barrels for the entire year, only 417 million barrels were recorded for the entire year. This represented about 59.57% output for the year.
Nigeria’s inability to drill up to 60% of its expected volume in 2022, cost the country over 40% of its revenue. Inability includes oil theft and sabotage as a result of incessant shut-in of planned output for the period.
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A review of the NUPRC data covering the whole of last year, revealed that Nigeria only managed to drill 43.3 million barrels in January, turning out to be the highest output for the year; 35.2 million barrels in February; 38.3 million barrels in March and 36.5 million barrels in April.
It deteriorated to 31.7 million barrels in May; rose marginally to 34.7 million barrels in June, before falling to 33.6 million barrels in July last year.
In August, Nigeria produced 30.1 million barrels, against the 58.2 million barrels projection; followed by September in which Nigeria’s output fell to a multi-decade low of 28.1 million barrels while in October and November, the country drilled 31.4 million barrels and 35.5 million barrels respectively.
Furthermore, when recovery began to set in Ddecember last year, the country managed to drill 38.2 million barrels of oil, cumulating to around 417 million barrels instead of the forecast of 700 million barrels for the year by the federal government.
However, the crude oil production figures exclude condensates which are not included in the Organization of Petroleum Exporting Countries (OPEC) calculation. In 2022, OPEC’s daily production allocation averaged 1.8 million bpd.
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Last year witnessed one of the worst in the history of the country as it consistently failed to meet its OPEC quota. However, with the recent concerted effort to end oil theft in the country, there has been some recovery as underscored by the December output data.
Minister of State, Petroleum Resources, Timipre Sylva, said Nigeria was working towards meeting its OPEC crude oil production quota of 1.8 million bpd by the end of May 2023.
According to him, the federal government would continue to improve security along the tracks of the major crude oil pipelines and block every leakage through which crude oil is stolen.
But after months of stalling, Nigeria appears to be steadily on its way to meeting its OPEC production quota, hitting 1.235 million barrels per day in December.
However, the figure differed markedly from the production of 1.59 million bpd announced for the month by the Nigerian National Petroleum Company Limited (NNPC) earlier and the 1.35 million bpd by a Bloomberg survey.
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In January 2022, out of the expected 1.88 million bpd production figure, 1.39 million bpd was drilled. In February, March, April, and May 2022 respectively, oil production fell steadily to 1.25 million bpd, 1.24 million bpd, 1.22 million bpd, and 1.02 million bpd, while in June it rose marginally to 1.15 million bpd, before falling to 1.08 million bpd in July.
In August, the oil sector hit a deadly blow on the Nigerian economy, slumping to 972,394 bpd, and further falling to 937,766 bpd in September, before rising to 1.014 million bpd in October.
By Ken Okoye
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