Nigerian oil and gas firms lost around 38% of their revenue in the second quarter of 2020, with the spread of the Covid-19 virus triggering losses of over $200m in the sector.
Four of the country’s oil and gas majors, Total, Mobil, Ardova, and Seplat, posted revenues of around $350m in the second quarter of this year, down from $560m in the three months to start the year. Total and Mobil, international firms with Nigerian operations, accounted for the majority of these losses, posting $140m in lost revenue between them; meanwhile, Nigerian-headquartered Ardova and Seplat reported losses of just over $13,000 respectively.
The Covid-19 pandemic has been a key driver behind this decline, as it has shattered demand for oil. With many offshore operations continuing to accrue expenses, but without the volume of oil sales to offset these costs, many operations are no longer financially viable. In addition, the country’s storage capacity is being stretched, with Mele Kyari of the Nigeria National Petroleum Corporation telling Al-Jazeera that around two billion barrels of oil will have to be stored as it cannot be sold.