Down time, oil theft and nigerian oil price The way I see it:
We have an average down time of 2 days in august-september, and "pipeline losses" of around 13,3 % from the beginning of the year to end of August 2012 (see Oct 11 press release)
So, for an average field production of 100 bopd (based on producing days) the effective output is:
100 bopd X (1- 2/30) X (1-13,3%): 80,92 bopd
So, we can say that, on average, we have a production loss of around 20% due to down time and "pipeline losses".
But, on the other hand, and trying to make a comparison with a similar E&P business in a more stable jurisdiction (for example, USA) we receive a greater price for our product (Brass River price of US$ 115 vs WTI of US$ 92 at the time of this post).
So, in order to know if the nigerian oil price differential compensates for the product losses, you simply apply the percentage of losses (roughly 20%, as I said before) to the Brass River price (US$ 115 per barrel). You get an effective "after losses" price of US$ 92 per barrel, similar to the WTI price.
I,m sure most north american producers are quite happy receiving a US$ 92 price for their oil. There is no reason for us not to be happy too.
Just my oppinion
Fernando