(Ecofin Agency) - Nigeria is now the third most costly country to produce oil in the world after United Kingdom (UK) and Brazil, with a production cost of crude oil per barrel at $28.99, according to a Wall Street Journal's analysis of 12 notable oil producers.

Nigeria comes after the UK and Brazil in terms of production cost analysis. UK and Brazil produce a barrel of oil at $44.33 and $34.99 respectively.

The analysis revealed that production in Nigeria was more costly than in the United States in spite of the latter’s use of expensive technology.

Oil producers in Nigeria pay $4.11 as taxes on a barrel of oil, while $13.10, $8.81 and $2.97 goes into capital costs, production costs as well as administration or transportation cost.

In the US, for shale, $6.42 goes into taxes, while $7.56, $5.85, and $3.52 are used as capital costs, production costs as well as administration and transportation.

However, Saudi Arabia expends the smallest amongst the 12 sampled countries in the world for the extraction and trade of crude oil with a tax of zero dollar.

“Saudi Arabian crude is some of the cheapest in the world to extract because of its location near the surface of the desert and the size of the fields. That makes transporting those barrels an outsized piece of its costs, on a percentage basis, compared with countries where production costs are 10 to 20 times as high,” it reveals.

The survey further highlighted that for every barrel of crude produced in Nigeria, the country nets around $20 turnover, as oil prices recovered to levels above $48 or above. Meanwhile, Saudi Arabia could earn as much as $40 or more at the same price level.

The Nigerian Minister of State for Petroleum Resources, Emmanuel Kachikwu, had said once that, when oil prices were at prices below $40 per barrel, that the country could still make some revenues from its production, This Day news reports.

Anita Fatunji