Benefits Negotiations Force Removal of 140,000BPD of Crude from Nigerian Output - Africa’s premier report on the oil, gas and energy landscape.

Benefits Negotiations Force Removal of 140,000BPD of Crude from Nigerian Output

By Macson Obojemuinmon

A stalemate in negotiation of wages and benefits led ExxonMobil’s Nigerian workers to shut in the company’s oil wells, forcing the American major to declare force majeure on oil liftings from its major export terminals in the country.

ExxonMobil’s Qua Iboe Terminal loaded 138,731Barrels of Oil and Condensate (blend) Per Day in March 2023. The company’s two deepwater FPSOs – Erha and Usan – which are considered terminals in their own right, produced a combined 116,142BPD in the same month, according to figures from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

Several of the staff told Africa Oil+Gas Report, “we are making all efforts to bring everyone back to the negotiation table”, thus, corroborating the statement by the company’s spokesperson Michelle Gray:  “We will continue to take all reasonable actions necessary to resolve the impasse as soon as possible”.

Some of the staff themselves admit that it is very unusual to shut down production to prove a point on the negotiating table for wages and benefits. “I would have thought they would have allowed for some further negotiation before taking the decision to shut down production”, one staff admitted “This is not the best for anyone”.

ExxonMobiil’s output, which is entirely offshore, has been one of the least affected by the crude oil theft from evacuation infrastructure, a key factor in Nigeria’s plunging hydrocarbon production. But the fields have suffered natural depletion in the last 10 years, as the company has invested less on the facilities.

The shallow water assets, which delivered close to 140,000BPD in March 2023, are in the process of being sold by ExxonMobil to Seplat, although the refusal of the regulator to grant consent for the sale has forced a halt in the proceedings.

Yet the ongoing negotiations are not restricted to either deepwater asset workers or shallow water staff.

“There’s no transition in ExxonMobil yet”, the staff disclosed to AOGR. “Until government gives their approval, (for the sale and purchase of the shallow water assets) we are maintaining the status quo”.

“We are all one as at today. No difference”,

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