LAGOS: Shell Nigeria declared ``force majeure'' Friday on exports of Bonny Light Crude oil, blaming increasing oil thefts that analysts say likely will lead companies to sell off more investments in Nigeria's declining onshore oil industry.
The announcement of ``superior force'' was effective from noon Thursday, after Shell reported three new leaks on the Trans-Niger Pipeline that it has been forced to close at least five times in three months.
The declaration gives Nigeria's biggest oil producer some legal protection against contractual obligations.
Shell said it has repaired 189 crude theft points this year on the Trans-Niger Pipeline and the Nembe Creek Trunkline that carry a daily total of 300,000 barrels of crude _ at least 15 percent of the production of Africa's biggest oil producer.
A statement from managing director Mutiu Sunmonu called the increasing thefts a ``dangerous development.''
Stratfor Global Intelligence in an analysis Thursday noted that major oil companies including Shell continue to sell onshore investments in the restive Niger Delta _ a reflection that ``the aging and now lower-producing fields are no longer worth the effort of dealing with the associated political and security problems.''
Onshore production now accounts for only 25 percent of Nigerian oil, compared to 75 percent in the 1970s, according to the firm based in Austin, Texas. Stratfor said reduced investment and declining output onshore would eventually reduce the power of the Niger Delta's politicians and militants and their ability to influence Nigerian politics.
Experts estimate Nigeria loses about 200,000 barrels a day to theft with most stolen by international criminal gangs that sell it on world markets.
They say some Nigerian politicians and military leaders benefit from the massive thefts in a country suffering endemic corruption. Smaller amounts of oil are stolen by members of communities impoverished by decades of spills that have destroyed the livelihoods of farmers and fishermen.
Human rights groups say Shell, the first company to begin producing oil in Nigeria in 1958, often blames theft to avoid paying damages to local communities and to avert criticism about corrosion on the 48-year-old Trans-Niger Pipeline.
indiatimes.com
The announcement of ``superior force'' was effective from noon Thursday, after Shell reported three new leaks on the Trans-Niger Pipeline that it has been forced to close at least five times in three months.
The declaration gives Nigeria's biggest oil producer some legal protection against contractual obligations.
Shell said it has repaired 189 crude theft points this year on the Trans-Niger Pipeline and the Nembe Creek Trunkline that carry a daily total of 300,000 barrels of crude _ at least 15 percent of the production of Africa's biggest oil producer.
A statement from managing director Mutiu Sunmonu called the increasing thefts a ``dangerous development.''
Stratfor Global Intelligence in an analysis Thursday noted that major oil companies including Shell continue to sell onshore investments in the restive Niger Delta _ a reflection that ``the aging and now lower-producing fields are no longer worth the effort of dealing with the associated political and security problems.''
Onshore production now accounts for only 25 percent of Nigerian oil, compared to 75 percent in the 1970s, according to the firm based in Austin, Texas. Stratfor said reduced investment and declining output onshore would eventually reduce the power of the Niger Delta's politicians and militants and their ability to influence Nigerian politics.
Experts estimate Nigeria loses about 200,000 barrels a day to theft with most stolen by international criminal gangs that sell it on world markets.
They say some Nigerian politicians and military leaders benefit from the massive thefts in a country suffering endemic corruption. Smaller amounts of oil are stolen by members of communities impoverished by decades of spills that have destroyed the livelihoods of farmers and fishermen.
Human rights groups say Shell, the first company to begin producing oil in Nigeria in 1958, often blames theft to avoid paying damages to local communities and to avert criticism about corrosion on the 48-year-old Trans-Niger Pipeline.
indiatimes.com
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