Gas shortage threatens as NLNG suspends production due to flooding in the oil producing region of Nigeria

 

Due to severe flooding that has hampered supply, the Nigeria Liquefied and Natural Gas firm has declared

force majeure, according to a company official on Monday.

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. 

According to Reuters, the statement might make Nigeria's cash crisis worse and would reduce the amount of gas available globally as Europe and other countries seek to replace Russian shipments as a result of the invasion of Ukraine in February.

All of NLNG's upstream gas suppliers have reportedly declared a force majeure,

According to spokesperson Andy Odeh, "the warning by the gas suppliers was a result of high floodwater levels in their operational locations, leading to a shut-in of gas production and considerable disruption of gas supplies to NLNG."

Odeh said NLNG was assessing the severity of the disruption and will work to lessen its effects.