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Shell declares force majeure on gas supply to NLNG

By on August 11, 2016

Shell Petroleum Development Company of Nigeria Ltd has declared force majeure on gas supply to the Nigeria LNG’s export facility on Bonny Island.

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

The oil major said the force majeure was declared on August 8, 2016, following a leak on the Eastern Gas Gathering System pipeline through which it supplies the bulk of Shell’s gas to NLNG.

“The pipeline has been shut down for a joint investigation visit into the cause of the leak and repairs,” a Shell spokeswoman, Natasha Obank, said in a statement, adding that SPDC continues to supply gas to the facility through other pipelines.

Shell had, on August 4, 2015, declared force majeure on gas supplies to the NLNG from the Eastern Gas Gathering System following a leak along the EGGS-1.

NLNG is owned by four shareholders, namely, the Federal Government, represented by the Nigerian National Petroleum Corporation (49 per cent), Shell Gas BV, (25.6 per cent), Total LNG Nigeria Limited (15 per cent), and Eni International (N.A,) N. V. S. a. r. l (10.4 per cent).

It has the capacity to produce 22 million tonnes of LNG a year and has long-term supply contracts with Italy’s Enel, Shell, France’s Engie SA and Portugal’s Galp, among others. It also sells on the spot market.

 

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