OREANDA-NEWS. Nigerian oil production has been reduced to 1.4mn b/d because of attacks by armed militant groups, oil minister Ibe Kachikwu said today. This is the lowest since 1989.

Nigerian output had recovered to 1.75mn b/d in July, from 1.69mn b/d a month earlier — itself the lowest in almost two decades.

Attacks against oil and gas facilities by rebel group Niger Delta Avengers since February this year has led to a series of force majeures on Nigerian crude, including key export grade Forcados. The government is working with local communities and the armed groups to solve the problem, Kachikwu said.

The Nigerian government is also working to reform the way it funds its cash-call obligations to its upstream joint venture partners such as Shell, Total, Italy's Eni, Chevron and ExxonMobil. State-owned NNPC owes over $6bn to these companies and the cost of meeting NNPC's majority stake in these ventures is over $2bn annually, Kachikwu said.

The government has been unable to adequately fund NNPC's cash-call obligations for years, leading to delays in new upstream projects. Changing the arrangement is aimed to end NNPC's financial obligations, which instead would be funded by the foreign joint venture partners.