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Shell’s Nigerian operations face uncertainty after pipeline shutdown

Shell Petroleum Development Company of Nigeria has announced that unforeseeable circumstances are threatening its exportation of Forcados crude oil following “a shutdown by the pipeline’s operator,” a spokesperson for the firm told Reuters Thursday.

The spokeswoman said the closure took effect on Monday after Heritage Energy Operational Services Limited, the operator, shut down the Trans Forcados pipeline on 4th April.

The global oil giant has been facing wide-ranging challenges in Nigeria including litigations from host communities in the Niger Delta, insecurity legislative issues and the country’s acute infrastructural deficit.

Read also: Banks’ profits to drop further in 2020 due to COVID-19 – Agusto

“In our Nigerian operations, we face various risks and adverse conditions. These include security issues surrounding the safety of our people, host communities and operations; sabotage and theft and our ability to enforce existing contractual rights.

“Others are litigation; limited infrastructure; potential legislation that could increase our taxes or costs of operations; the effect of lower oil and gas prices on the government budget; and regional instability created by militant activities. These risks or adverse conditions could have a material adverse effect on our earnings, cash flows and financial condition,” the company’s 2019 annual report said.

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