Nigeria again is facing decline in production in the month of August, as oil theft, sabotage and flooding have affected operations according to the Italian energy company Eni SpA (ADR) (NYSE:E)
The giant energy company said that there has been a daily loss of 30,000 barrels of oil a day, which is the equivalent to 2 percent of the company’s overall production, Business Day reported Wednesday.
According to the Nigerian National Petroleum Company oil theft has amounted to revenue losses of around $1.23 billion in the first quarter of 2013.
In July Royal Dutch Shell PLC (NYSE:RDS.A) shut down a major crude oil pipeline in Nigeria over leaks caused by thieves to the tune of 150,000 barrels of oil per day of lost production.
Theft and disruptions in oil supplies occur frequently in Nigeria. Pipeline vandalism increased by 224 percent from 2010 to 2011, according to the U.S. Energy Information Administration, or EIA.
In April 2012 about 400,000 barrels per day of oil were stolen, leading to a 17 percent drop in oil sales, according to Nigeria’s Ministry of Finance.
Shell is Nigeria's largest oil producer, and it was estimated in 2012 that 6 percent of the country's total production on average was lost to oil theft and spills.
According to the EIA, criminals use small boats to navigate swampy shallow waters of the Niger Delta where they puncture pipelines to tap the oil and then pour it into small tanks.
Eni (E) And Shell (RDS): Losing Billions Of Dollars In Nigeria As Oil Production Continues To Fall Due To Theft, Sabotage And Flooding
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