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Nigeria cuts gas exports

02 December 2008

In recent years, militants have blown up crude oil pipelines and kidnapped foreign workers in the Niger Delta, and now, thieves are taking advantage of this insecurity to tap into pipelines.
Shell Petroleum Development Company (SPDC) has been forced to close its Soku gas plant in the delta, which supplies 40% of Nigeria LNG’s (NLNG) feedstock, to repair damage caused by thieves tapping into energy pipelines, further worsening Nigeria’s power generation problems.

Nigeria cuts gas exports
Nigeria cuts gas exports

Power generation has already dropped over 800 megawatts due to inadequate gas supply causing Egbin to run at reduced capacity and Sapele being completely shut down. NLNG Limited, who supplies 10% of the world’s LNG, has warned it may not be able to meet its export obligations despite trying to optimise feedgas from other suppliers.

Shell has declared force majeure on its gas supplies to the Soku plant, following vessels illegally siphoning fuel from connecting pipelines, resulting in a growing concern for safety. To ensure the safety of staff repair work must be carried out on the pipelines surrounding the perimeter of the plant. Furthermore, SPDC will clean up environmental damage caused by condensate which is often spilt during illegal activities. It has not been stated how long the repairs will take to be completed.

Following the declaration of force majeure, the supply of liquefied petroleum gas (LPG) to the domestic market will also decline.

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