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Oil Thieves Cause Fire On Nigerian Oil Block

A fire has broken out on an oil lease in the southeastern state of Imo in Nigeria, during what preliminary investigation believes to be illegal bunkering activity by thieves, Nigerian media reported on Friday.

The Nigerian Petroleum Development Company Limited (NPDC), the upstream unit of the Nigerian National Petroleum Corporation (NNPC), has reported a fire at its Oil Mining Lease (OML) 20 in the state of IMO, NNPC said on Friday, as carried by the news outlet This Day.

According to the preliminary investigation, illegal oil theft has caused a spark that ignited the fire in the oil block, Mansur Sambo, the Managing Director of NPDC, said in statement. The fire has been put out, NPDC said.  

Neither NNPC nor NPDC disclosed how much oil has been leaked or stolen and whether there have been shut-ins of oil production on the oil lease as a result of this incident.

Earlier this week, NNPC raised the alarm that oil pipeline vandalism in Nigeria is soaring, with the number of incidents of breached pipelines surging by 115 percent in July compared to June.  

Pipeline vandalism, as well as pipeline sabotages by militants in Nigeria’s oil-rich Niger Delta area, has plagued Nigeria’s oil production and exports for years. Over the past year and a half, militant activity has subsided, allowing Nigeria to boost its crude oil production, and also making Africa’s largest oil producer a full-fledged participant in the production cuts of the OPEC+ coalition.

But since it became part of the pact in January 2019, Nigeria has been one of the largest overproducers and non-compliant OPEC members in the deal. Nigeria pledged in September to fall within its respective cap while the cartel and its allies are trying to rebalance the oil market. Nigeria may face an easier task to finally fall in line with its share of the OPEC+ production cuts after OPEC has recently raised the African producer’s oil output ceiling.    

By Tsvetana Paraskova for Oilprice.com

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