A new report has revealed that vandalism has severely disrupted operations at the Nigeria Liquefied Natural Gas (NLNG) Limited facility on Bonny Island, slashing natural gas supplies by 80% and limiting the company’s ability to meet both domestic and international demand.
The report, published by Bloomberg, highlights how persistent sabotage and vandalism have crippled key infrastructure, reducing the facility’s gas supply to a mere 20% of its required capacity. As a result, Nigeria’s only LNG export plant has been forced to scale down production significantly, with just two out of its six processing units currently operational.
The crisis was underscored by NLNG’s Chief Executive Officer, Philip Mshelbila, during the Nigeria International Energy Summit in Abuja last week. Mshelbila disclosed that three of the facility’s vital gas pipelines have been shut down due to vandalism, hampering operations and disrupting gas exports.
Global Implications of Nigeria’s LNG Decline
The Bloomberg report warns that the continued decline in Nigeria’s LNG output could have far-reaching consequences on the global energy market, particularly in Asia and Europe, where supply is already tightening. In 2024, nearly half of Nigeria’s LNG exports were directed to Asia, a third to Europe, and the remainder to the Americas and the Middle East. However, fresh data compiled by Bloomberg indicates that Nigeria’s LNG exports plunged by 40% in February alone due to pipeline destruction by suspected vandals.
The crisis has also led to delays in scheduled shipments for March, with reports suggesting a minimum postponement of 10 days. Industry stakeholders, including Shell Plc., the Nigerian National Petroleum Corporation (NNPC), TotalEnergies, and Eni, are closely monitoring the situation, given their vested interests in NLNG.
Legal and Financial Repercussions
In a related development, a London court last Wednesday ordered NLNG to pay $380 million in compensation to two commodity traders, Vitol and Glencore, over its failure to deliver contracted LNG cargoes. The ruling comes amid concerns that prolonged disruptions could further strain the company’s financial standing and dent Nigeria’s credibility in the global energy market.
Efforts to obtain comments from Shell and NLNG representatives regarding the dwindling gas supply were unsuccessful, as both companies’ spokespersons did not immediately respond to inquiries.
NLNG’s Mission Under Threat
Established to harness Nigeria’s vast natural gas resources, NLNG was incorporated as a limited liability company to produce Liquefied Natural Gas (LNG) and Natural Gas Liquids (NGL) for both local and international markets. However, the continued wave of vandalism threatens to undermine this mission, putting Nigeria’s energy sector under increased pressure.
As global energy markets brace for potential shortages, stakeholders are calling for urgent interventions to secure Nigeria’s gas infrastructure and prevent further damage to the country’s LNG export capacity.
