New projects in Angola and action to stem disruption to Nigerian crude supplies have failed to lift west African crude production.
Deepwater projects like Angola's Clov, which came on stream in July, are going some way to tackle Angola's fall in crude production caused by decline rates of around 15pc/yr at older fields.
Disruption to Nigerian crude exports caused by rebel activity and crude theft appears to be easing a little this year. But production is not increasing significantly, because of lack of investment in new projects in the country.
In the months ahead, there is little chance of either Nigeria or Angola increasing exports, with stagnant output the best hope for Africa's largest and second largest crude exporting countries.
In Angola, medium sweet Clov will add 160,000 b/d at its peak, according to operator Total, while BP's Saturno has added 150,000 b/d since the start of last year. Despite this, Angolan crude exports averaged 1.6mn b/d for the first half of this year, down by 100,000 b/d on 2013.
The next major project due on stream comprises Italian firm Eni's Sangos, Ngoma and Cinguvu fields at the Block 15/06 west hub offshore Angola. That will add 90,000 b/d, but not until late this year.
Nigerian crude production is also at best stagnating, despite some signs that disruption to crude supplies is alleviating.
The country's main rebel group — the Movement for the Emancipation of the Niger Delta (Mend) — declared a temporary ceasefire on 30 May, ending its attacks on oil and gas facilities. In March, Mend claimed responsibility for an attack on a pipeline supplying Forcados crude, putting the grade under force majeure from late-March to mid-May.
Despite Mend's cessation of activities, crude theft remains a significant problem with 150,000-300,000 b/d lost this way, although current indications are that disruption is less severe than it was last year.
So far this year, Nigerian crude and condensate exports have averaged 1.93mn b/d, up by around 30,000 b/d on 2013. Currently, only EA crude is under force majeure in Nigeria as repairs works are carried out to offshore equipment.
Under-investment is preventing Nigerian crude output from rising.
Operators have delayed any significant projects with seemingly unending wrangles set to continue over Nigeria's petroleum industry bill, which has still not been passed despite its introduction to the legislature in 2008.
Nigerian state-owned NNPC sees production at 2.4mn b/d, attributing the disparity between that number and exports largely to crude theft and domestic refinery capacity utilisation hitting at least 120,000 b/d. Condensates make up around 200,000 b/d of Nigeria's output.
Little significant new upstream capacity is planned to come on stream this year in Nigeria, with many of the larger operators warning that problems in the country and uncertainty over the petroleum industry bill are deterring investment.
Asia-Pacific buyers — particularly China — remain the main takers of west African crude, with 1.82mn b/d moving east for July-loading. But this is still below December's all-time high of 2.08mn b/d, as mellowing refinery demand and higher freight costs take away some demand.
US buying remains in the doldrums as domestic light sweet production there increases, although buying does rebound when the WTI to North Sea Dated spread narrows. US buyers took 196,000 b/d of west African crude in June, compared with 636,000 b/d a year before.
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