Shell Declares Force Majeure, Shuts 600,000bpd Export Pipeline

Shell

The nation’s crude oil exports is facing a fresh threat as Shell Petroleum Development Company of Nigeria Limited on Friday declared force majeure on export of Bonny Light, Nigeria’s reference crude oil grade, the second time in three months.

This is coming four days after the oil major declared force majeure on gas supply to the Nigeria LNG’s export facility on Bonny Island following a leak on the Eastern Gas Gathering System pipeline through which Shell supplies the bulk of its gas to NLNG.

Force majeure is a legal clause that allows companies to cancel or delay deliveries due to unforeseen circumstances.

The Media Relations Manager, SPDC, Mr. Precious Okolobo, told our correspondent that the declaration of the force majeure on Bonny Light was as a result of the shutdown of the Nembe Creek Trunk Line by the pipeline operator, Aiteo following a leak.

Bonny Light is the latest of the nation’s crude oil grades under force majeure. The largest export stream, Qua Iboe, Forcados and Brass River are still under force majeure.

The country has continued to grapple with militant attacks that have hobbled its oil production and exports, further worsening the revenue woes facing the government.

With the declaration of force majeure on Bonny Light exports, some of Nigeria’s production may have been shut in.

Inaugurated in 2010, the 100-km NCT feeds the Bonny export terminal, and has a capacity of 600,000 bopd, according to Shell’s website.

About the Author

Samed Olukoya
Samed Olukoya is the CEO/Founder of investorsking.com, a digital business media, with over 10 years' experience as a foreign exchange research analyst and trader. A graduate of University of East London, U.K. and a vivid financial markets analyst.

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