NLNG reportedly stops gas shipments due to vandalism, declares additional force majeure

Nigeria Liquefied Natural Gas (NLNG) Limited is said to have cancelled several liquefied natural gas shipments after production was disrupted due to vandalism of pipelines by oil thieves.

This is coming barely three months after NLNG declared force majeure on its 22.2 million ton per year Bonny LNG export facility due to widespread flooding that disrupted supply.

Two people with direct knowledge of the matter anonymously confirmed that the multinational gas company declared additional force majeure on LNG cargoes for export and cancelled the loading of at least two cargoes scheduled for January delivery from the Bonny Island facility.

In an email seen by newsmen, Nigeria LNG Limited confirmed the fresh force majeure but insisted that the Bonny Island plant is still active.

Part of the statement seen by newsmen said, “Nigeria LNG Limited confirms that operations at its plant on Bonny Island are still active despite a Force Majeure declared in October 2022 and feedgas supply challenges. The plant continues to produce LNG and LPG commensurate to the feed gas it receives from its upstream gas suppliers.

“In addition to ensuring steady operation, NLNG remains committed to its culture of transparency and maintains consistent communication with key stakeholders on developments in the upstream sector. The company is closely monitoring the resolution of supply challenges by all relevant parties.”

The development could further negatively affect Nigeria’s ability to close the gas supply gap in Europe and others, which has been affected by the Russia-Ukraine war.

Nigeria has been a key LNG supplier to Europe over the last year, helping to partially plug the gap created by the loss of Russian supply.

According to data, gas imports from Nigeria constitutes about seven per cent of Europe’s LNG supply in 2022.

These sources have also said that more gas shipments for February could be scrapped.

In addition to the flood challenges experienced last year, the gas output in the country has also been disrupted by serious security challenges and feed gas problems.

Recall that earlier in October 2022, the NLNG declared force majeure on its 22.2 million ton per year Bonny LNG export facility due to widespread flooding that disrupted supply thereby worsening Nigeria’s gas shortage challenges and revenue crisis.

The development is coming as Nigeria had to battle its worst floods in about a decade, with no fewer than 500 people reported to have been killed and billions of naira worth of properties damaged.

Earlier in August 2022, the NLNG said it had lost almost $7 billion in revenue so far in 2022 due to a shortage of gas supply.

The revenue loss was attributed to the increasing security challenge which has hit the oil and gas companies across the country and has negatively been impacting the production and revenues of the NLNG.