* Flooding cuts Nigeria production by 500,000 bpd
* Shell declared force majeure on Bonny, Forcados
* NNPC says oil output around 2.1-2.2 mln bpd
By Joe Brock
ABUJA, Oct 24 Nigeria has lost at least a fifth
of its oil output in recent weeks due to severe flooding and oil
theft, government oil officials said on Wednesday, in comments
that helped push oil prices higher.
Nigeria's oil is exported to the United States, Asia and
Europe and the current disruptions estimated at 500,000 barrels
per day could amount to as much as 0.5 percent of global supply.
Nigeria lost around 500,000 barrels per day (bpd) of oil
production due to severe flooding in recent weeks, an industry
regulator told Reuters.
"Around 500,000 bpd was shut down for a two to three week
period but things are back to normal now," a spokesman for the
Department of Petroleum Resources said by phone.
Another official, the head of the Nigerian National
Petroleum Corp. (NNPC) said Nigeria's output, including crude
and condensate, fell to around 2.1-2.2 million bpd last week,
from an average of 2.5 million bpd this year.
There was little evidence On Wednesday that production was
back to normal after one of Nigeria's biggest operators, Royal
Dutch Shell said on Tuesday its Nigerian venture had
declared force majeure on exports of Bonny and Forcados crudes.
The force majeure was declared on Friday as Shell cited
damage caused by thieves and flooding affecting a third-party
supplier it did not identify.
Bonny Light and Forcados streams are two of Nigeria's most
important oil grades and in October accounted for 427,000 bpd,
about a fifth of Nigeria's total exports of 2.048 million bpd.
Separately, French oil company Total on Tuesday
told Reuters it had stopped oil and gas production from its
onshore OML 58 block due to flooding. The block, in which Total
has a 40 percent stake, normally produces the equivalent of
90,000 bpd of oil.
Total spokeswoman Anastasia Zhivulina told Reuters in an
email on Tuesday that gas output lost at OML 58 had been
"partially compensated by other fields, located offshore."
Industry experts believe data from the Nigerian central bank
and from export shipping programmes provided by oil traders show
that NNPC's output figures are often optimistic.
Africa's biggest oil producer has experienced its worst
flooding in five decades this year. The River Niger, Africa's
third longest, burst its banks last month, submerging stretches
of the swampy oil-rich region.
On Sept. 30, Shell said its Nigerian unit closed the Bonny
pipeline which sends crude to the Bonny terminal and stopped
150,000 bpd of production after oil thieves caused a fire.
Brent prices edged higher on Wednesday with market
participants saying news from Nigeria was partly responsible for
"This could certainly be producing a little bit of buying
interest in the spreads and therefore forcing backwardation a
little wider," said Tony Machacek from Bache, referring to front
month Brent prices outpacing gains in other months due to
expectations of an imminent tightness in supply.