Nigeria LNG Limited (NLNG) has declared force majeure on product supplies from its production facilities on Bonny Island.
The declaration follows widespread flooding which has disrupted the operation of its upstream gas suppliers.
A force majeure frees parties in a contract from liability or obligation when a circumstance beyond the control of the parties, such as war, strike, riot, crime, epidemic or sudden legal changes prevents one or both parties from fulfilling their obligations under the contract.
A statement by NLNG’s spokesperson Andy Odeh said “the notice by the gas suppliers was a result of high flood water levels in their operational areas, leading to a shut-in of gas production which has caused significant disruption of gas supply to NLNG. Consequently, NLNG activated force majeure clauses in accordance with the Sales and Purchase Agreements (SPA) provisions.”
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It added that “NLNG is currently reviewing the situation with gas suppliers to ascertain the extent of the disruption to its operations but would, as a reasonable and prudent operator, endeavour to mitigate the impact of the force majeure to the extent reasonably possible.”
