Royal Dutch Shell declared “force majeure” on Nigerian Forcados crude oil exports on Wednesday after a malfunctioning barge obstructed the tanker path.
According to reports, Shell Petroleum Development Company stated in a statement that the action took effect on Monday at 12:00 p.m.
“Efforts were being made to restore access,” it said.
Force majeure is a situation in which a party is unable to perform a contractual obligation due to an event beyond their control.
The oil and gas sector accounts for almost 90 per cent of Nigeria’s foreign exchange supply and approximately 10 per cent of its GDP, while exportation of petroleum products account for roughly 86 per cent of revenue needed to fund the country’s annual budget.
Forcados crude oil is one of Nigeria’s unique crude blend with an average turnover of about 200,000 barrels per day.
The stoppage of activities is coming a month after the SPDC said it was restoring flow from its Bonny island facility.
Nigeria had in November regained the top spot of crude production in Africa, with an average production of 1.27 million barrels per day.
Halt in crude shipments from Nigeria’s Forcados could further exacerbate existing shortages that have affected crude oil exportation in recent months amidst COVID-19 variant fears.
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