Nigeria’s oil production has dropped again as a third major crude-export facility was disrupted, this time by accidental damage rather than militant attacks.
Exxon Mobil Corp. declared force majeure — a legal clause that allows it to stop deliveries without breaching contracts — on shipments of Qua Iboe late on Thursday, according to two traders from companies that purchase the crude, who asked not to be identified because the information isn’t public. The Bonny Light and Forcados oil grades were already disrupted following militant attacks. The three facilities ship more than 700,000 barrels a day.
An Exxon spokesman in Nigeria was not immediately available to comment.
A resurgence in militant attacks in Nigeria’s oil-producing region has cut output by as much as 600,000 barrels a day to 1.4 million a day and “massively diminished” the nation’s income, Emmanuel Kachikwu, Nigeria’s minister of state for petroleum, said Thursday in a broadcast on Lagos-based Channels Television. An armed group calling itself the Niger Delta Avengers later warned of more attacks to come.
Attacks on oil infrastructure caused Nigerian production to drop to 1.69 million barrels a day last month, the lowest in 20 years, according to data compiled by Bloomberg. The nation’s output hasn’t fallen as low as 1.4 million barrels a day on a monthly-average basis since 1989, the data show. The supply reduction is compounding economic problems caused by the slump in crude prices.
A subsea pipeline linked to Qua Iboe was damaged by a drilling rig, Exxon said Thursday, without giving an impact on shipments. Royal Dutch Shell Plc declared force majeure on exports of Bonny Light crude Wednesday following the discovery of a leak on the Nembe Creek Trunk Line.
Attacks had already halted shipments from the Forcados terminal and the Okan oil platform, which feeds into the Escravos export terminal. Nigeria deferred at least seven Escravos cargoes scheduled to load in May and June, according to revised loading programs obtained by Bloomberg on May 10.