Major Nigerian oil company Nigeria LNG confirmed on Thursday that: there is a “significant disruption” to natural gas supplies due to the floods that hampered its operations and export capacity, including supplies to Galp, Portugal.
“There is a significant disruption to gas supplies,” the company said in statements to the AP news agency, confirming it declared “force majeure” Monday due to the impact of the floods on its natural gas extraction and exports. liquefied.
Portuguese energy company Galp was among the first to warn that Nigeria’s gas exports to Portugal were being affected, at a rate that could amount to 3.8% of the supply of the largest gas producer in sub-Saharan Africa, according to the consultancy. Energy.
Nigeria LNG is largely owned by the Nigerian government, and also includes energy giants Shell and Eni, with the capacity to produce more than 20 million tons of liquefied natural gas per year, although production does not exceed 70% due to vandalism and theft affecting the gas pipelines in the most populous African country.
Floods in Nigeria have already killed more than 600 people and displaced 1.3 million from their homes, “exacerbating an already dire situation” for the national gas company. Nigerian energy adviser Toyin Akinosho told the AP.
The NLNG supply freeze is bad news for Europe, as Nigeria accounts for 14% of natural gas imports on the continent, as well as for other customers in North America, the Middle East and Asia.
“The company’s invoked ‘force majeure’ makes liquefied natural gas markets even tighter for the winter, when demand is highest, Nigerian analyst Olufola Wusu said.
“If we cannot meet local demand, we will most likely have barely enough gas for export, meaning some of our customers will be forced to buy natural gas from other suppliers,” he added.
In the past 12 months, NLNG has exported about 20 loads per month, half of which go to Europe, according to financial information agency Bloomberg, indicating that the impact on the market has been limited so far.
Europe faces a moment of easing from the energy crisis, with robust natural gas flows, full stockpiles and weather forecasts pointing to moderate temperatures: “At current stock levels, this could have a less severe impact than initially expected as recovery from other suppliers could can offset lower Nigerian production,” said BloombergNEF analyst Michael Yip.
Nigeria LNG warned Galp of “a significant reduction in the production and supply of liquefied natural gas” as a result of rains and floods in West and Central Africa, which could jeopardize supplies to Portugal, according to a note issued by the Portuguese company sent to Securities. Market committee on Monday evening.
In that note, Galp said that “no information has yet been made available to support the assessment of the potential impact of the event, which could, however, lead to additional supply disruptions” to the Portuguese oil company.
Following this information to the market, the Ministry of Environment and Climate Action said that “there is currently no confirmation of a reduction in gas deliveries from Nigeria”, stating that there is still no “deficit in the market”.
The guardianship stressed that “any alarming information is inappropriate, especially in times of global uncertainty”.
Source: DN
