(Bloomberg) — Royal Dutch Shell Plc halted crude shipments from Nigeria’s Forcados export terminal, dealing another blow to the African nation, which has struggled to stem falling production.
Shell Petroleum Development Co. of Nigeria Ltd. issued a notice of force majeure on Forcados shipments, effective from midday local time on Dec. 21, and plans to issue a revised offtake program in due course. More than 200,000 barrels a day of Nigerian crude normally pass through the terminal.
The shutdown comes just a month after Shell said it was restoring flows from the nearby Bonny facility. Force majeure is a clause that allows companies to skip contractual obligations following issues outside of their control.
The latest halt adds to Nigeria’s ongoing reliability issues that have hampered the country’s sales in recent months, according to two traders of West African crude. Some refiners — particularly smaller ones that have limited ability to switch their crude slates at short notice — have been reluctant to buy Nigerian crude due to the uncertainty of when cargoes will arrive at their processing plants, the traders said.
The stoppage occurred during replacement of one of the two single point moorings at Forcados, with the positioning of a jack-up barge preventing tanker access, export operations and resumption of full production into the terminal, Nigerian National Petroleum Corp. said in a notice. The presence of the jack-up offshore support vessel Seacor Strength at the Forcados moorings was confirmed by ship tracking data monitored by Bloomberg.
Neither NNPC nor Shell gave an indication of the likely duration of the stoppage. The force majeure suggests it will be long enough to affect four remaining cargoes that a port agent report seen by Bloomberg shows are due to be loaded this month.
Since Shell announced the month-long force majeure at the Bonny site in October, only one ship has loaded a cargo from that terminal.
(Updates with reaction from traders in fourth paragraph)
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