Amukpe-Escravos pipeline becomes secure route for crude oil transport

Following the launch of the new Amukpe-Escravos Pipeline in Nigeria, oil companies operating in the oil-rich West African country now have a more secure route for transporting crude oil.

The new crude oil transportation option will significantly minimise incidents of oil theft which has drastically affected the revenues of many oil companies.

Business Insider Africa gathered that the new pipeline has a capacity to convey 160,000 barrels of crude per day. Also, the 67-kilometre long pipeline is mostly underground, thus hiding it away from criminals who specialise in pipeline vandalism and oil theft.

Note that the dewatering process for the new pipeline was completed on Friday August 9. And currently, the Site Acceptance Test has commenced with the transportation of commercial-sized crude volumes.

In the meantime, some top players in the Nigerian upstream oil sector have begun taking advantage of the new pipeline. One of them is Seplat Energy Plc. The indigenous oil major, whose shares are listed on the Nigerian Exchange and the London Stock Exchange, said in a corporate disclosure earlier today that it has already begun commercial transportation of crude oil through the Amukpe-Escravos Pipeline.

The Chief Executive Officer of Seplat Energy Roger Brown explained how the development would help the company to guarantee a better bottom line for stakeholders going forward.

“The commercial launch of the Amukpe-Escravos Pipeline is a significant event for Seplat Energy and for Nigeria, offering a more secure and reliable export route that will assure higher revenues and profitability for Seplat Energy, enabling us to make a larger contribution to Nigeria’s economy. We commend the work that has made this possible and appreciate the efforts of our partners and all contractors involved to create this more reliable and secure export route for Nigeria’s oil,” the CEO said in the disclosure by Seplat, as seen on the Nigerian Exchange’s website.

Prior to this time, Seplat and other oil companies in Nigeria relied on the The Trans-Niger Pipeline to transport their crude extracts. Unfortunately, the pipeline has suffered major attacks recently, causing stakeholders to avoid it.

Recall that Business Insider Africa had previously reported that oil theft is the main reason Nigeria has been struggling to meet its production output quota, as set by the Organisation of Petroleum Exporting Countries (OPEC).

The problem is so serious such that between October 2021 and February this year, oil companies in Nigeria were able to receive only 5% of all the crude volumes that were transported through the heavily-vandalised Trans Niger Pipeline.

Last month, the Managing Director of Shell Petroleum Development Company of Nigeria Ltd, Mr Osagie Okunbor, described oil theft as an existential threat to oil companies in Nigeria. Other notable stakeholders in the Nigerian oil and gas sector have also voiced their frustrations over the issue.

Recent efforts by the Nigerian Government have yielded little or no result towards solving what is arguably the most chronic problem affecting oil companies in Africa’s largest oil producing nation.

It is now the expectation of many stakeholders that the new Amukpe-Escravos Pipeline will provide relative security and respite.

Source: Africa Business Insider

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