Emmanuel Egbogah, President Goodluck Jonathan’s adviser on energy, said Nigeria had been maintaining steady output of 2.6 million barrels per day (bpd) for the last year, split between 1.96 million bpd of crude and 650,000 bpd of condensate.
But he said Africa’s largest producer has potential it has not yet tapped because of a limit set by the Organization of the Petroleum Exporting Countries.
“Our installed oil capacity is 3.733 million bpd...we will definitely apply to review our quota,” Egbogah said in Nigeria’s capital Abuja.
“It will be easy to be granted because once we are able to demonstrate higher reserves and that we have developmental needs in our country and the explosive population that we have, we are sure we will be granted higher level of production.”
Nigeria, which has repeatedly made its case for a higher OPEC target, is already pumping well above the 1.67 million bpd cap set by the producer group.
Analysts, however, say only Gulf states within OPEC have significant spare capacity that can quickly be added to the market in time of need.
With oil prices near two-year highs above $110 a barrel, the market might welcome more oil from Africa’s largest crude exporter.
The light, sweet crude oil produced in Africa’s most populous nation is similar to the type of oil pumped by Libya and would be a good replacement for European refiners, if they need extra supplies because of the North African crisis.
But Egbogah said Nigeria had no plans to raise production further without consultations with its OPEC partners.
“I think there is a temptation (to produce more) but we belong to an organization, called OPEC, in order to make sense out of production and price management in the world,” he said.
Egbogoh said he was doubtful Nigeria’s long-delayed energy reforms would pass before elections in April but he was confident the Petroleum Industry Bill (PIB) would become law by the end of the current administration on May 29.
The PIB, which will rewrite Nigeria’s decades-old relationship with its foreign oil partners and alter everything from fiscal terms to the structure of the state-oil firm, has become synonymous with missed deadlines.
Egbogah said once the PIB was passed, it would immediately provide the government with $3-$5 billion of extra revenue each year, while billions more would be added during the full implementation of the reforms in a 30-month timeframe.
Delays to the PIB have stalled billions of dollars worth of investment, preventing Nigeria getting close to its target of producing four million bpd of oil and attaining 40 billion barrels of oil reserves by 2010.
Nigeria’s oil production increase over the last two years has been the result of a recovery of output lost in attacks by militants on infrastructure in the Niger Delta, which at its height in 2006 cut out a quarter of the OPEC’s members output.
An amnesty brokered with militants in 2009 brought more than a year without significant attacks, allowing oil companies to repair damaged pipelines and ramp up production.
Some analysts have suggested the stall in investment will result in a flattening out of Nigeria’s oil production but Egbogah said previous targets were achievable.
“Nigeria’s oil production will not plateau in the next five years because we will be aiming to achieve four million bpd so at the current 2.6 million bpd and growing we are going to reach that 4 million bpd,” he said.
