Exxon Units Declare Force Majeure on Oil Liftings in Nigeria
ExxonMobil Corporation’s two Nigerian subsidiaries have declared force majeure on oil liftings from their offshore facilities in the Niger Delta region. This follows a series of attacks on oil and gas infrastructure in the region by militants, which have disrupted production and caused a sharp drop in exports.
Background of the Situation
The Niger Delta region is home to some of the world’s largest oil and gas reserves, and is a major source of revenue for the Nigerian government. However, the region has been plagued by violence and unrest for decades, with militant groups regularly attacking oil and gas infrastructure in an effort to gain control of the region’s resources.
The most recent attacks began in March 2021, when militants attacked a number of oil and gas facilities in the region. The attacks caused a sharp drop in production and exports, leading to a shortage of oil and gas in the region.
ExxonMobil’s Response
In response to the attacks, ExxonMobil’s two Nigerian subsidiaries, ExxonMobil Exploration and Production Nigeria Limited (EMEPNL) and Mobil Producing Nigeria Unlimited (MPNU), have declared force majeure on oil liftings from their offshore facilities in the Niger Delta region.
Force majeure is a legal term that allows a company to suspend or terminate a contract due to circumstances beyond its control. In this case, ExxonMobil is citing the attacks on its facilities as the reason for the force majeure.
Impact of the Force Majeure
The force majeure will have a significant impact on the Nigerian economy. The country is heavily reliant on oil and gas exports, and the disruption caused by the attacks has already caused a sharp drop in exports. The force majeure will further reduce exports, leading to a further decline in revenue for the Nigerian government.
The force majeure will also have an impact on the local communities in the Niger Delta region. Many of these communities rely on the oil and gas industry for their livelihoods, and the disruption caused by the attacks and the force majeure will have a significant impact on their incomes.
International Response
The international community has condemned the attacks on oil and gas infrastructure in the Niger Delta region. The United Nations Security Council has called for an immediate end to the violence, and has urged all parties to work towards a peaceful resolution of the conflict.
The United States has also expressed its concern over the situation, and has called on the Nigerian government to take action to protect its oil and gas infrastructure. The US has also offered to provide assistance to the Nigerian government in addressing the security situation in the region.
Outlook
It is unclear how long the force majeure will remain in effect, as the security situation in the Niger Delta region remains volatile. The Nigerian government has deployed additional security forces to the region in an effort to protect oil and gas infrastructure, but it is unclear if this will be enough to prevent further attacks.
In the meantime, the force majeure will continue to have a significant impact on the Nigerian economy and the local communities in the Niger Delta region. It is essential that the Nigerian government and the international community work together to find a peaceful resolution to the conflict and restore stability to the region.