NIGERIA'S OIL PRODUCTION UP TO 2.2 MBD

PLATTS - Nigeria's oil output including condensates remained on an upward swing despite an increase in sabotage attacks on production facilities, state oil company Nigerian National Petroleum Corp. said Monday.

The country's production hovered around 2.2 million b/d in the first week of August, an NNPC spokesman told S&P Global Platts, compared with around 1.92 million b/d a year ago.

The country's crude and condensate production has risen sharply in the past six months due to the start up of the 205,000 b/d deepwater Egina field which came online December 29.

The African producer pumped 2.1 million b/d and 2.05 million b/d of crude and condensate in June and July respectively, based on Platts estimates.

The NNPC spokesman said however that the steady growth in production was being threatened by a corresponding rise in cases of attacks on its network of oil pipelines.

"NNPC recorded a 77% increase in cases of oil pipeline vandalism in its network of pipeline infrastructure in June 2019," he said, adding that the company was collaborating with government security agencies to secure the pipelines and other production facilities.

Oil companies warned last week that escalating production costs due in part to security issues posed a serious challenge to Nigeria's bid to boost its oil output and reserves.

The companies, under the umbrella body of the Oil Producers' Trade Group of the Lagos Chamber of Commerce of Commerce and Industry, said high costs were a major disincentive to investing in new projects.

"Nigeria ranks amongst the top 10 countries with the highest cost of producing oil and gas equivalents per barrel. Security costs are escalating as peculiarities of the business environment require additional resources be deployed to secure our people and assets," chairman of the group Paul McGrath said at an industry event in Lagos August 22.

Nigeria has said it aims to sharply increase its crude oil production to 3 million b/d and reserves to 40 billion barrels by 2023, from around 2 million b/d and 37 billion barrels now.

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