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On Tuesday 4 June, The Director General of NIMASA, Dr. Dakuku Peterside at the Nor Shipping Conference and Exhibition in Oslo, Norway stated that Nigeria will be able to lift its crude oil for export as soon as the national fleet becomes operational.
Dr. Dakuku said such an outcome will end the capital flight associated with the present arrangement where Nigeria sells its oil on Free on Board (FOB) basis to customers and would also lead to employment creation.
The new national fleet will be owned by a technical partner (49 percent) and by Nigerian investors (51 percent). The proposed national fleet would be private sector-led for sustainability and profitability, therefore inviting both local and foreign investors who are interested in partnering with the country on this project.
Dr. Dakuku also assured potential investors about Nigeria’s maritime security and the investment in the acquisition of security assets to boost the policing of its waters. He noted that the assets, acquired under the ‘Deep Blue Project’, would be operational by September 2019.
The National Bureau of Statistics report showed that 47 percent (146.14 million litres) of the Liquefied Petroleum Gas (LPG) supply in the country in the first quarter of 2019 was imported, while 53 percent (164.71 million litres) was produced locally.
The United States accounted for 46 percent (67.10 million litres) of Nigeria’s LPG imports in the period, while India, Trinidad and Tobago, Algeria, Argentina, and Equatorial Guinea supplied the remaining 1 percent.
The US exported 19.29 million litres, 7.26 million litres and 40.55 million litres of LPG to Nigeria in January, February and March respectively. According to the Nigerian National Petroleum Corporation (NNPC), Nigeria has around 202 trillion cubic feet of proven gas reserves, plus about 600 trillion cubic feet unproven gas reserves.
Out of 8.5bscfd of natural gas production in Nigeria, only 18 percent of natural gas produced is being utilized by the domestic market, while a large percentage of the gas produced is used for the export market.
On Saturday 1 June, Cameroon National Oil Refining Company (SONARA), based in the coastal area of Limbe, declared a force majeure after a fire incident occurred in parts of the refinery.
Four out of the 13 production units of the refinery were down due to the fire, thus halting output. SONARA, which is almost entirely state-owned apart from a 4 percent stake held by Total, has a capacity of 2.1 million tonnes of crude a year and refining capacity of 42,000 barrels per day (bpd).
The Minister of Water Resources and Energy, Gaston Eloundou Essomba, said the refinery serves the whole country, so any delay in getting it back up and running has the potential to cause severe fuel shortages.
It is also a major supplier to the region, including Nigeria, Togo and Ghana, with some products also being exported to the US and Europe. However, on Tuesday 4 June, the refinery resumed work effectively and is fully functional.
On Thursday 6 June, oil prices attempted to bounce back from five-month lows with U.S. crude wavering between gains and losses in early-morning trade. The U.S. West Texas Intermediate crude futures gained 9 cents at $51.77 a barrel at 9:42 AM ET (13:42 GMT), while Brent crude futures traded up 25 cents at $60.88.
The Energy Information Administration in its weekly report showed a surge in U.S. crude stockpiles by 6.771 million barrels, while output rose to a record 12.4 million barrels per day (bpd) in the week ending May 31, compared with forecasts for a stockpile draw of 0.85 million barrels.
Investors struggled to decide between the opposing forces of economic fear and hopes that OPEC-led production cuts can overcome increases in U.S. supply and balance the market. Surging production in the U.S. added to fears that trade disputes would damage oil demand, counteracting sanctions on Iran and Venezuela and efforts by OPEC and its allies to lower supply. OPEC is currently scheduled to meet on June 25, followed by talks with its allies led by Russia on June 26. However, Russia suggested moving the meeting to July 3-4.