Production Target: Underinvestment, Persistent Maintenance Issues, Investors’ Flight Bar Nigeria from Hitting Target

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……As production fell by 10% in November

By Chibisi Ohakah, Abuja

An Organization of Petroleum Exporting Countries (OPEC+) data has shown that Nigeria’s oil production fell by 10% in November. It said further that, Nigeria and Angola, Africa’s largest producers of oil, continued to struggle to pump at target with Angola’s compliance hitting its highest this year at nearly 300%.

Quoting the data, Reuters said in a report yesterday that the two countries have failed to produce at targets in recent years due to underinvestment, persistent maintenance issues and an exodus of international energy companies.

Despite raising production slightly, Nigeria’s effort to meet its production quota recorded a 10 percentage points drop month on month to 239% in November 2021, the report said.

The agency said in the overall, the Organization of Petroleum Exporting Countries and allies (OPEC)+ compliance with oil production cuts rose to 117%  in November from 116% a month earlier, two sources from the group told the international news agency, indicating production levels remain well below agreed targets.

The agency said compliance from the 10 OPEC countries participating in the production cuts reached 122%, with participating non-OPEC countries achieving 107%.  The International Energy Agency (IEA) said in its December oil market report that OPEC+ missed its production targets by 650,000 barrels per day (bpd) last month, compared with 730,000 bpd in October.

Production of Russian oil and gas condensate, the latter being excluded from the deal, has been broadly stable in December versus November. Russian deputy prime minister, Alexander Novak has said the country’s oil production will reach pre-pandemic levels by May 2022.

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