Leadership (Abuja)
Betrand Nwankwo
14 September 2008
Royal Dutch Shell has extended its force majeure on Nigerian Bonny Light crude oil exports, Shell's spokesman, Mr Rainer Winzenried said in a statement at the weekend.
Meanwhile, another Nigerian crude, Brass River, has returned to its normal loading schedule in October, having experienced repeated loading delays in the recent months, traders said.
The action, freeing Shell from contractual obligations, was extended because of security concerns in the Niger Delta region and because the oil firm had found more leakages at a Bonny Light pipeline.
Shell Petroleum Development Corporation (SPDC), the company's local unit is extending suspension it declared on July 29 on the Bonny light offtake program, adding that the suspension would "depend on the progress of repair work
"We have found more leaks at the pipeline. So repair works became more complicated than we had thought. This is also because of the security situation," Winzenried added.
Shell did not give a specific date for ending the action, first declared after sabotage to the Nembe Creek pipeline in July and initially in effect to the end of September.
The escalation of violence by militant rebels in the Niger Delta this year has repeatedly crippled oil supplies from Nigeria, which exports about 2 million barrels of oil a day.
The loss of high quality crude from Nigeria, which is the world's eighth largest oil exporter helped push oil prices to record highs above $147 a barrel in July this year.
Shell, the operator of Bonny Light, is the worst hit by the rebel attacks. October loading programmes has shown that Bonny Light exports will average about 197,000 bpd for the month, about half the grade's normal production, prompting oil traders to expect an extension of the force majeure after September.
Bonny Light production should be about 400,000 bpd, if there are no problems. But export programmes have shown that output has not recovered to that level this year.
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