Nigeria’s New Crude Oil Contender Hits Global Market, Bolstering Economic Prospects
Nigeria’s state oil company, the Nigerian National Petroleum Corporation Limited (NNPCL), has launched the sale of its newest crude oil grade, the Utapate blend, a mere six months after commencing production. The move, announced at the Argus European Crude Conference in London, signals a significant boost for Nigeria’s crude oil sector, with promising implications for revenue generation and economic expansion.
In a statement from Abuja, Chief Corporate Communications Officer Olufemi Soneye said the product’s London debut attracted a crowd of eager European crude oil marketers. Designed to meet stringent international standards, the Utapateblend features a low sulphur content of just 0.0655 percent and a minimal carbon footprint, aligning with the rising global demand for cleaner energy sources.
July 2024 saw the first major milestone for Utapate when the NNPCL, in partnership with Sterling Oil Exploration and Energy Production Company Limited, shipped an initial cargo of 950,000 barrels to Spain. Since then, production has ramped up at an impressive pace, reaching 40,000 barrels per day, with five cargoes already delivered to buyers in Spain and the eastern United States. Two additional shipments are lined up for November and December, underscoring growing international interest in this new crude grade.
The Utapate field, located in Oil Mining Lease 13 in Akwa IbomState, is operated by NNPC E&P Limited and Natural Oilfield Services Limited, a subsidiary of SEEPCO Limited. The reserves hold an estimated 330 million barrels of crude oil, 45 million barrels of condensate, and 3.5 trillion cubic feet of gas—solidifying Nigeria’s standing in the global energy market.
Addressing the launch, NNPC E&P Managing Director Nicholas Foucart hailed the Utapate crude blend as a “significant milestone for Nigeria’s oil export sector,” lauding the rapid development and strategic timing of its global introduction. According to Foucart, production is on track to rise further, with projections aiming for 50,000 barrels per day by January 2025 and a leap to between 60,000 and 65,000 by mid-year. By year’s end, the goal is to hit a steady output of 80,000 barrels per day.
Since entering the market, Utapate has been met with enthusiasm from international refiners, drawn to its light, sweet profile. This blend shares characteristics with the Nembe crude, another low-sulphur oil grade from Nigeria. Its favourable API gravity and efficient yield of high-value products make it highly desirable to refineries, while its environmental credentials satisfy stricter regulatory requirements worldwide.
In his remarks, Lawal Sade, Managing Director of NNPC Trading Limited, compared Utapate’s pricing and appeal to the established Amenam crude grade, highlighting its competitive advantages. “Our strategy with Utapate is to optimise value not only for Nigerian producers but also for our partners across global markets,” Sade stated. He noted that with Utapate, NNPCL aims to increase returns while responding to shifting demands for cleaner energy sources.
This strategic expansion aligns with NNPC’s broader commitment to sustainable development. Foucart emphasisedthat the Utapate crude terminal, from production facilities to shipping logistics, complies fully with environmental standards aimed at reducing carbon emissions and ecological impact. The original Utapate field development plan, executed from 2013 to 2019, involved extensive adaptations, including converting wells and other facilities to land-based operations—a crucial factor in minimising environmental disruption.
The unveiling of the Utapate blend comes nearly a year after the launch of Nembe crude, produced under the NNPC/Aiteo OML 29 Joint Venture, further broadening Nigeria’s slate of marketable, eco-friendly crude options. Together, these initiatives reflect the NNPCL’s strategy to align Nigeria’s oil exports with global sustainability goals while reinforcing the country’s role as a key supplier in the global energy market.
For Nigeria, the Utapate blend’s entry into the international marketplace represents more than just an economic gain. It stands as a testament to the country’s capacity for innovative, responsible energy production. With its vast reserves, lower environmental impact, and rising export volume, Utapate may well be a cornerstone in Nigeria’s push towards sustainable growth and energy diversification, with lasting benefits for both local and global markets.
