Cooking gas scarcity looms, as NLNG declares force majeure

The severe flooding that has disrupted supply has prompted the Nigeria Liquefied and Natural Gas (NLNG) firm to declare force majeure, as Nigerians face a possible scarcity of the product.

This was contained in a statement issued on Monday by the NLNG’s spokesman, Andy Odeh.

A clause known as “force majeure” is frequently found in contracts and, in essence, releases both parties from responsibility or obligation when an extraordinary event or circumstance, such as a war, strike, riot, crime, epidemic, or sudden changes in the law, prevents one or both parties from upholding their end of the bargain.

READ ALSO:Cooking Gas Scarcity Looms as NIMASA Detains NLNG Vessel

Odeh said NLNG was determining the extent of the disruption and would try to mitigate the impact of the force majeure.

NLNG further claimed that all of its upstream gas suppliers had announced force majeure, compelling it to do the same.

“The notice by the gas suppliers was a result of high floodwater levels in their operational areas, leading to a shut-in of gas production which has caused significant disruption of gas supply to NLNG,” he noted in a Reuters report.Read more

The situation will reduce global gas supplies and possibly deepen Nigeria’s cash crisis as Europe and other countries try to replace Russian exports as a result of the invasion of Ukraine in February.

Over 600 people have died, 1.4 million have been evacuated, and roads and agriculture have been devastated in Nigeria due to flooding.

The flooding, which was brought on by unusually high rains and the discharge of water from a dam in Cameroon, may go into November, according to officials.

In July 2022, Nigeria LNG Ltd’s plant was producing at up to 68% of its capacity due to theft of crude oil and vandalism of pipelines, among other problems.

Chief Executive Philip Mshelbila said theft and vandalism were gradually strangulating Nigeria’s oil and gas sector.

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