Shell declares force majeure on gas supplies to Nigeria’s LNG plant over pipeline leak

Shell Petroleum Development (SPDC) has declared force majeure on gas supplies to a liquefied natural gas (LNG) export facility located in Nigeria on Bonny Island, due to a pipeline leak.

The leak occurred on the company’s Eastern Gas Gathering System (EGGS-1) pipeline.

SPDC is the Nigerian unit of Royal Dutch Shell and is a joint venture with state oil company Nigerian National Petroleum (NNPC).

Both companies supply gas to the LNG facility.

Shell’s declaration of force majeure is expected to have an impact on exports from the plant.

Following the leak, the pipeline was closed to carry out a joint investigation in a bid to determine the cause of the incident.

The company plans to continue supplying gas to the facility using other pipelines.

The plant is owned by NNPC, Shell, Total and Eni and is capable of producing 22 million tonnes of LNG per year.

It also has supply contracts with Italy's Enel, Shell, French company Engie and Portuguese-based Galp.

The Nigerian government has reinstated offering payments to former militants and is negotiating discussions to end attacks on pipeline infrastructure in the Niger Delta.

Militant attacks have cut crude production to almost a 30-year low.