Nigeria’s Oil Exports Surge Blighted by Abductions, Outages
(Bloomberg) -- A spate of disruptions and security concerns, including kidnappings, are threatening to hinder surging Nigerian oil exports.
Royal Dutch Shell Plc and Total SA declared force majeure on some of their Nigerian exports over the past week, a measure that allows companies to skip supply obligations. Chevron Corp.’s Nigerian unit said an idled well was interfered with.
While the precise cause of the Total force majeure remains unclear, the Shell and Chevron incidents involved third parties. The disruption comes just a few years after militants caused Nigeria’s oil production to plunge by attacking pipelines and other pieces of energy infrastructure.
Last week, two foreign workers were abducted from an onshore oil rig owned by Niger Delta Petroleum Resources Ltd., according to the army. Separately, two Shell workers were kidnapped and their police escorts killed as they were driving in Rivers state, Lagos-based The Nation newspaper reported.
“The attacks and disruptions are a general commentary on the state of insecurity in the country,” said Cheta Nwanze, an analyst at Lagos-based SBM Intelligence business advisory.
Nigeria struggled to restore output in the wake of militant attacks in 2016, but exports of crude and condensates are set to reach a 22-month high of 1.997 million barrels a day in June, according to loading programs seen by Bloomberg. Smaller-scale sabotage caused by people trying to steal oil remains rife.
Shell said its exports through the Bonny terminal were affected following the closure of the Nembe Creek trunkline, which feeds into it, following a fire. Total said it couldn’t meet its Amenam oil field exports due to a production issue.
The incidents in Nigeria add to a long list of supply curbs globally among both members and non-members of OPEC including Venezuela, Iran, Canada, Mexico, Saudi Arabia and, most recently, Russia.
Brent crude, which is similar to many of the grades found in Nigeria, has gained 34 percent this year. It was up 69 cents at $72.73 a barrel at 11:23 a.m. in London.
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