Shell Resumes Gas Supply to Nigeria LNG Bonny Island Plant

Nigeria LNG Ltd. said Royal Dutch Shell Plc (RDSA)’s local unit resumed deliveries to its plant on Bonny Island nine days after declaring force majeure, a legal clause that allowed it to miss shipments.

“Their gas supply is now restored and we expect that they remove their force majeure,” Anne-Marie Palmer-Ikuku, a Lagos-based spokeswoman for Nigeria LNG, said today in an e-mailed response to questions. “Nigeria LNG has loaded eight LNG and two condensate cargoes” since Sept. 20 and is currently producing at 95 percent, she said.

Shell, the biggest supplier to Nigeria LNG, on Sept. 23 declared force majeure, a legal step that protects a company from liability when it can’t fulfill a contract for reasons beyond its control, after shutting its Trans Niger pipeline to repair crude leaks due to theft. That cut the six-train Bonny Island LNG plant’s gas supply by 30 percent, Palmer-Ikuku said.

Gas deliveries to the Nigeria LNG plant were restored on Sept. 30 following repairs on a leaking pipeline and force majeure is still in place, Precious Okolobo, a Shell spokesman, said today by telephone from Lagos, the commercial capital.

Nigeria LNG’s Bonny Island plant is Africa’s biggest, able to produce 21.8 million metric tons of the chilled gas a year, or almost 8 percent of the world’s total, according to data from the International Group of LNG Importers. The company supplied 15 percent of global LNG for near-term delivery last year, according to the Paris-based lobby group.

Nigeria LNG, which has long-term contracts with buyers in Spain, Italy, France and Turkey, exported 333 cargoes in 2012, the most since sales began in 1999, according to a report on its website. State-run Nigerian National Petroleum Corp. is the biggest shareholder, with a 49 percent stake. Units of Shell, Total SA and Eni SpA (ENI) hold 26 percent, 15 percent and 10 percent, respectively.

To contact the reporter on this story: Elisha Bala-Gbogbo in Abuja at ebalagbogbo@bloomberg.net

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