Again, Shell declares force majeure on Bonny Light

Shell facility12 October 2013, Lagos – Shell Petroleum Development Company of Nigeria Limited, SPDC, has again raised the alarm on the increasing trend of crude oil theft, which it said had caused repeated closures of two key pipelines this year, resulting in deferment of up to 300,000 barrels of oil per day.

The troubled oil giant also said yesterday that it had declared force majeure on exports of Bonny Light grade of crude oil effective noon (Nigerian time), October 10, 2013.

Nigeria’s Bonny Light is the toast of foreign refiners because of its low Sulphur content. Spokesman of Shell Nigeria, Mr. Precious Okolobo said in a statement that the declaration of the force majeure followed production deferment from leaks observed on the Trans Niger Pipeline (TNP) at B-Dere, Nonwa – Tai and Bodo West in Ogoniland area of Rivers State.

Okolobo said an investigation visit by the regulators, including SPDC and members of the community discovered that the spill at B-Dere was caused by unknown persons, who drilled holes on the line.

He said similar investigation visits were being organised for Nonwa – Tai and Bodo West.
“The entire TNP system, comprising the 24-inch and 28-inch has been closed down at least five times since early July this year due to multiple leaks from crude theft connections. The downstream section of Nembe Creek Trunkline (NCTL) between San Barth and Bonny was reopened on August 6, after the removal of 60 crude theft points, but was shut again in September with the discovery of seven additional connections. Repair of the line is progressing,” Okolobo said.

The Shell spokesman said a total of 189 crude theft points had been repaired on the TNP and NCTL between January and September this year.

Commenting on the development, the Managing Director of SPDC and Country Chairman of Shell Companies in Nigeria, Mr. Mutiu Sunmonu said his company was “dealing with a social tragedy, an environmental crisis and a sad waste of resources.”

He said, “We find it difficult to safely operate our pipelines without having to shut them frequently to prevent leaks from illegal connections impacting the environment. Ironically, it appears the crude thieves use repair windows to prepare and quickly launch fresh illegal connections when we restart production. While SPDC continues to play its part in combating crude oil theft by amongst other things, increasing surveillance of pipelines and organising daily helicopter over-flights of pipeline routes, the experience of the past few months requires more concerted efforts by all stakeholders, including Government and communities, to address what is turning out to be a dangerous development in the Niger Delta,” Sunmonu explained.

SPDC Limited operates the SPDC joint venture on behalf of its partners – the Nigerian National Petroleum Corporation (NNPC, 55per cent); Total, (10per cent) and ENI (five per cent) with Shell’s share being 30per cent.

Shell had on Wednesday shut the Trans Niger Pipeline (TNP), deferring production of 150,000barrels of crude oil per day, following reports of new leaks, barely 10 days after the line was repaired from crude oil theft incidents.

The company said it shut the line as a precautionary measure after receiving reports of the incidents and had also mobilised a spill response team.

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