Friday, 01 December 2023 04:47

OPEC+ sets Nigeria’s maximum oil output for 2024 at 1.5m bpd for this reason

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OPEC+ handed Nigeria a 2024 oil output target lower than Africa's largest oil producer had hoped for while lowering Angola's target, according to a statement from the group of oil-producing countries.

The move follows a meeting in June where OPEC+ agreed a complex deal that revised production targets for several members.

OPEC had tasked three consultancies - IHS, Rystad Energy and Wood Mackenzie - with verifying production figures for Nigeria, Angola and Congo.

Based on that it has given Nigeria a 2024 target of 1.5 million barrels per day (bpd), Angola one of 1.11 million bpd and Congo a target of 277,000 bpd, OPEC+ said in the statement.

In June it had been agreed, pending the assessments by the consultancies, that Angola could produce 1.28 million bpd and Nigeria 1.38 mln bpd and possibly as much as 1.58 million bpd.

Both have failed to meet previous quotas hurt by underinvestment and security issues.

Congo's target for 2024 is roughly in line with what was agreed in June.

NIGERIA 'OPTIMISTIC'

Disagreements over African output quotas was cited by sources as a reason OPEC+ postponed an in-person OPEC+ meeting sceheduled for Nov. 26 until Thursday.

Angola on Thursday was unhappy with its 2024 output target and does not plan to stick to it, Bloomberg reported.

Nigerian output has been in decline for years, but has picked up in recent months helped by more production offshore, which is less prone to security problems, two analysts told Reuters.

Still, Nigeria's own targets of hitting 2 million bpd in crude and condensate output next year are more optimistic than realistic, they said.

According to Rystad's calculations, under its base case scenario Nigeria can expect to see crude output rise to 1.5 million bpd next year assuming no further disruptions.

FGE analyst James Forbes said that the country's maximum crude output this year has been about 1.51 million bpd, so this is likely what they can achieve if all streams were to operate at maximum capacity.

"However, most of Nigeria's fields are mature and declining so it is unlikely this would happen," he said.

 

Reuters

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