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Oil exports to rebound after floods

26 October 2012, 09:32

Geneva - Oil exports in December are expected reach the highest level since May, pointing to a swift recovery of production after floods knocked out a fifth of the output.

Nigeria is expected to ship 2.12 million barrels per day of crude oil onto the market in December, unchanged from volumes in November which hit a six-month high.

The country lost around 500 000 barrels per day of output due to severe flooding in recent weeks, an industry regulator told Reuters.

The flooding, combined with damage caused by oil theft, prompted Royal Dutch Shell to declare force majeure on two of the country's major crude streams Bonny Light and Forcados last Friday. A force majeure allows a company to suspend contractual obligations in the face of unexpected events.

On Thursday, traders reported longer delays of around 10 days on the Forcados grade compared with 5 days earlier this week. Shell has not given a date for lifting its force majeure.

Nigeria's high quality light, sweet oil is exported to Asia, Europe and the United States and the recent disruptions could amount to about 0.5 percent of global supplies.

The latest export figure of 2.12 million bpd includes a Forcados grade shipping list which was delayed due to uncertainty about exports. Provisional loading schedules are subject to minor changes but this programme indicates that a provision 76 cargoes will load in December.

While shipments of Forcados in December are still lower versus previous months at 150 000 barrels per day, this is offset by higher volumes of Qua Iboe and Okono, the shipping list shows.

Qua Iboe will load 13 cargoes in December compared to 12 in November and Okono will load three compared to one the previous month.

Oil producer Maurel & Prom said on Thursday that it planned to restart its OVHAR site by Friday after a fire resulted in a 19-day shutdown but planned to restart the facility by Friday.

The fire caused one death and 10 injuries among workers hired by an unnamed third-party contractor to perform planned maintenance, according to the company.

The site is linked to the Trans Forcados pipeline.

- Reuters


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