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Chevron Says Nigeria Oil Link Breach May Halt Exports (Update1)

By Grant Smith and Alexander Kwiatkowski

Nov. 19 (Bloomberg) -- Chevron Corp., the second-largest U.S. oil company, suspended export obligations on some Nigerian production following a pipeline breach at the Escravos oilfield.

The so-called “force majeure” clause, invoked yesterday after the loss of 90,000 barrels a day last week, will last until Dec. 31, company spokesman Scott Walker said in an e- mailed statement.

“Necessary efforts are ongoing with all relevant stakeholders to evaluate the impact, repair the pipeline and restore production,” the statement said.

The pipeline is a joint venture between Chevron and the Nigerian National Petroleum Corp., in which Chevron holds a 40 percent stake. That means its share of the affected output amounts to 36,000 barrels a day, according to the statement.

The country’s crude industry has suffered this year from militant attacks and oil theft, which have at times allowed competing African producer Angola to overtake Nigerian output.

Chevron pumped an average of 110,000 barrels of oil a day from onshore and shallow-water fields in the Niger Delta last year and a further 14,000 barrels a day from its so-called enhanced-recovery project at the Okan and Delta deposits, according to its Web site. The company also produces oil from deepwater offshore fields.

To contact the reporter on this story: Alexander Kwiatkowski in London at akwiatkowsk2@bloomberg.net

Last Updated: November 19, 2008 05:18 EST

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