Force Majeure due to oil spill, fire, theft and floods in Nigeria

Force Majeure due to oil spill, fire, theft and floods in Nigeria

Shell Petroleum Development Company of Nigeria Limited (SPDC) has lifted the force majeure, declared last month, on the export of 25,000 barrels per day Bonny Light crude oil.Shell’s outages were prompted by a huge fire on an oil tanker being used to steal oil last month. The Anglo-Dutch major shut another pipeline in Imo River on Oct. 31 due to theft damage and deferred 25,000 bpd.
This emerged as ExxonMobil, yesterday, became the fourth major oil firm in a month to warn customers against delays into Nigerian oil and gas exports, adding to a raft of problems for Africa’s biggest energy producer caused by oil spills, theft and flooding.
Shell lifted its force majeure on Nigeria’s benchmark Bonny Light crude oil exports, easing some of the supply concerns.
But three of Nigeria’s main oil grades; Qua Iboe, Brass River and Forcados are still under force majeure. These oil streams together account for around 700,000 barrels per day (bpd) or a third of the nation’s total exports.
ExxonMobil declared force majeure on Qua Iboe crude oil exports, yesterday, due to outages caused by a pipeline oil spill on November 9, which witnesses said had spread 20 miles down the coastline. Mark Ward, the Managing Director of ExxonMobil in Nigeria, said a clean up had been mobilised, and he apologised to affected communities for the spill.
Total and Eni, have also declared force majeure, on gas and oil supplies, respectively.
Eni declared force majeure earlier this month on Brass River oil loadings due to floods, causing cargo delays of eight to 10 days.
Total, last week, restarted production from its 90,000 bpd Oil Mining Lease (OML) 58 block, which was shut down a month ago due to severe flooding in the Delta swamplands.
The force majeure on Bonny Light and Forcados grades was declared after supply of Bonny Light was affected by the fire on the Bomu-Bonny trunkline, while other incidents of oil theft and severe flooding in the Niger Delta dented supply of both Bonny Light and Forcados crude.
Oil traders said that loading delays are worsening and are now up to two weeks for some cargoes.
Oil theft is a major problem in the winding creeks and waterways of the Niger Delta, where it is easy to conceal boats and illegal refineries in the dense mangroves. Nigeria estimates around 150,000 bpd is stolen.

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