Shell declares force majeure on Nigeria LNG deliveries

Royal Dutch Shell Thursday said it would be unable to meet its delivery obligations to Nigeria Liquefied Natural Gas Limited (NLNG) after it closed its Soku gas plant to repair pipelines.

It said the repairs were required after damage caused by thieves and illegal connections.

"In recent months the number of illegal connections on pipelines has increased significantly and they are encroaching on the Soku plant itself, increasing safety risks to an unacceptable level," Shell Petroleum Development Company (SPDC) said.

SPDC Managing Director Mutiu Sunmonu said the company has had to remove more than 50 illegal valves in August and September alone.

"Over the last few weeks the situation has deteriorated rapidly and resulted in a situation where safety concerns dictated we had to shut in. We also approached a stage where we have questions regarding the integrity of the pipeline which we will check," he said.

SPDC is in a joint venture with the Nigerian National Petroleum Corporation (NNPC), Total's unit Elf Petroleum Nigeria Limited and Italy's Agip.

The Soku plant, located in the swamps of the southern Rivers State, supplies some 40 percent of the gas feed to NLNG, a project in which Shell has a 26 percent stake.

NNPC holds 49 percent in NLNG. Other significant shareholders in the gas venture are Total and Agip. NLNG supplies liquefied natural gas to markets in Europe and the United States.

LNG is natural gas that has been liquified for easy transportation.

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