Report has it that the Nigeria Liquefied and Natural Gas company has declared force majeure because of widespread flooding that has disrupted supply.
Force majeure is a common clause in contracts which essentially frees both parties from liability or obligation when an extraordinary event or circumstance beyond the control of the parties, such as a war, strike, riot, crime, epidemic or sudden legal changes prevents one or both parties from fulfilling their obligations under the contract.
The NLNG’s stance could worsen Nigeria’s cash crunch and would curtail global gas supply as Europe and others struggle to replace Russian exports due to the invasion of Ukraine in February.
NLNG said all of its upstream gas suppliers had declared force majeure, forcing it to make the declaration as well.
Officials have warned that the flooding, caused by unusually heavy rains and the release of water from a dam in Cameroon, could continue into November.
NLNG’s spokesperson Andy Odeh said that the notice by the gas suppliers was a result of high floodwater levels in their operational areas, leading to a shut-in of gas production which has caused significant disruption of gas supply to
He said NLNG was determining the extent of the disruption and would try to mitigate the impact of the force majeure.
There are fears that the flooding, caused by unusually heavy rains and the release of water from a dam in Cameroon, could continue into November.
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