Nigeria pipeline sabotage costs US$ 2.2 million per day

Eni

Nigeria loses US$ 2.2 million daily due to the shut down by an Italian oil firm, Eni of its 20 000 bpd crude oil pipeline, according to reports out this week.

The company said that the shutdown was due to sabotage on the pipeline, which had led to the interruption of 4000 bpd it gets from its 20% share in Nigerian Agip Oil Company.

Shell Nigeria

Shell Nigeria’s declaration this week that it cannot meet its international commitment to export 300 000 bpd of crude was caused by the company withdrawing contracts to pay people to monitor and protect the pipeline, Shell and independent reports indicate.

Nine oil spills in three weeks along one pipeline in the Adibawa-Okordia pipeline in the Niger Delta are believed to be the result of sabotage by youths using hacksaws.

An unknown quantity of oil has been lost and, since 2 August, fishing grounds and farmland have been polluted . With three more spills reported in the couple of days, commentators are wondering if the company has now lost some control of the pipeline.

On Tuesday, Shell Nigeria declared ‘force majeure’ on all Bonny light [crude] exports until the end of October.

Force majeure

With this force majeure, Nigeria's total production capacity, which stood at about 2.6 million bpd of crude oil, has declined to about 2.3 million bpd.

Edited from various sources by Elizabeth Corner

Read the article online at: https://www.worldpipelines.com/business-news/01082014/nigeria-pipeline-sabotage-costs-22-million-per-day-699/