Afren to begin oil export from Nigeria soon as Asians increase tender for supply

British oil firm Afren said it hoped to bring a field discovered in Nigeria in January into production in the “near-term”, after tests on the oil proved successful. This is coming on the heels of high demand for sweet crude from Asian countries. “Lots of tenders are running this week, so everyone is holding cargoes,” a trader said. The latest tender came from Indonesia, which had failed to purchase light sweet crude in similar tenders twice before. Traders said as much as two-thirds of April loading Nigerian crude was still looking for buyers. Qua Iboe was assessed around dated Brent plus $2.60/$2.70
Afren which main producing assets are in Nigeria and also has assets in Kenya and Kurdistan, said it will drill two production wells on the Okoro East field in the second half of 2012, meaning new output could be added this year. “We will now work towards realising near-term production from Okoro East. The tie back to existing facilities ensures a very high return on the additional wells,” Chief Executive Osman Shahenshah said in a statement on Wednesday.
Okoro East was discovered near its Okoro field in January, allowing Afren to use existing facilities at Okoro to add new production more quickly and cheaply than is usual when a new oil field is found. Afren, which in the middle of last year cut its production target after a delay at its key Ebok field in Nigeria, said in the longer term it will also submit a full field development plan for Okoro East to enable it to maximise its output. Initial production from the two wells at Okoro East could reach 14,000 barrels of oil per day (bopd), Afren said, a significant addition to the company’s year-end output rate of 55,400 bopd.
However a spate of import tenders from Asia were likely to support Nigerian light crude differentials while spot deals remained thin, traders said on Wednesday. “Lots of tenders are running this week, so everyone is holding cargoes,” a trader said. The latest tender came from Indonesia, which had failed to purchase light sweet crude in similar tenders twice before. April Angolan barrels were close to a sell out.Traders said as much as two-thirds of April loading Nigerian crude were still looking for buyers. Qua Iboe: assessed around dated Brent plus $2.60/$2.70 a barrel, steady. Bonny Light was assessed about 10 cents below Qua Iboe.
Petral, the trading unit of Indonesian state run energy firm Pertamina, issued tenders to buy sweet crude, with an amendment to include more oil on spot purchase, the tender document showed on Wednesday. In the semi-term tender, Petral is seeking to buy Nigerian crude, Bonny Light, Qua Iboe or Escravos, for May-July delivery. In the spot tender for May delivery, Petral is now seeking to buy some Libyan, Russian, Malaysian and Brunei crude in addition to Nigerian barrels. Other tenders include: Indian Oil Corp (IOC) for May loading and BPCL for sweet crude for loading in the second-half of April.