Crude Theft: Shell Declares Force Majeure on Bonny Light

05 May 2012

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By Ejiofor Alike

Shell Petroleum Development Company of Nigeria (SPDC) has declared force majeure on export of cargoes of Bonny Light following production deferment caused by incessant crude oil theft and illegal bunkering activities.

Bonny Light is a light grade of crude oil that is highly prized by foreign refiners for its low sulphur content.

The declaration of force majeure frees the oil giant from all contractual obligations to its customers due to unforeseen circumstances.

Shell’s Corporate Media Relations Manager, Mr. Tony Okonedo, said in a statement yesterday that frequent theft of crude oil and illegal bunkering on Nembe Creek Trunkline (NCTL) in Bayelsa State had forced the company to shut down the line with effect from 12 noon Friday.

“Shutdown of the line for repairs will result in a deferment of some 60,000 barrels per day of production. SPDC is working hard to repair the line and resume production as quickly as possible,” he said.

He noted that the NCTL, which is the major conveyor of SPDC’s and third party crude oil production in Eastern operations to Bonny Export Terminal, had to be replaced when the old one became weakened due to the installation of many crude theft points.

“The new NCTL which came into service in 2010 has also been repeatedly targeted by crude thieves, requiring that SPDC must now shut down sections of the line to allow the removal of illegal bunkering points,” he added.

Shell had frequently declared force majeure on Bonny Light exports due to production deferment from several pipeline incidents in Eastern operations.

In one instance, the company recorded six separate oil spill incidents on the Okordia – Rumuekpe trunk line at Ikarama in Bayelsa State, within two weeks, all from hacksaw cuts by unknown persons.

In another separate incident, three hacksaw cuts were reported on the nearby Adibawa delivery line.

The company’s Trans Niger Pipeline (TNP), which also transports crude oil production from SPDC and third parties in its Eastern operations to Bonny Terminal, had also been affected by leaks caused by hacksaw cuts.

Recently, there were five separate fire incidents caused by crude oil thieves on both the 24-inch and 28-inch lines in Bodo, Bera, Biera and Mogho all in Ogoni land in Rivers State.

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