Nigerian LNG Exports Blocked Over Tax Dispute

Nigerian LNG Exports Blocked Over Tax Dispute

June 24, 2013
"The potential implications of this current action by [maritime authorities] on NLNG operations are enormous," Nigeria Liquefied Natural Gas said in a statement condemning the blockade.

LAGOS, Nigeria—Maritime authorities have halted liquefied natural gas exports from Nigeria due to a dispute over fees and taxes, blocking ships at a facility producing some 7% of global liquefied natural gas supply, officials said today.

The maritime agency began blocking ships at the Nigeria Liquefied Natural Gas (NLNG) terminal late Friday afternoon over the long-running dispute, and the situation was unchanged today, a spokesman for the agency said.

NLNG's shareholders include Shell at 25.6%, state firm NNPC with 49%, Total LNG Nigeria at 15% and Eni at 10.4%.

According to NLNG, two maritime agency boats on Friday "ordered that one NLNG vessel, LNG Imo, and one chartered vessel, Torm Thames, remain at NLNG's loading bay, whilst another NLNG vessel, LNG Oyo, remains outside the Bonny Channel until further notice."

The agency "subsequently issued ship detention orders on 22nd June 2013, specifically detaining three NLNG ships (LNG Enugu, LNG Oyo, LNG Imo) and barring them from accessing or leaving the company's loading bay," NLNG said in a statement.

NLNG: Blockade is Unlawful

An NLNG spokesman said today there had been no change and alleged that the blockade was in violation of a court order preventing such action.

The company said it made a $20 million payment under protest following a flare-up of the dispute in May while taking the matter to court.

"The potential implications of this current action by [maritime authorities] on NLNG operations are enormous," NLNG said in its statement, in which it condemned the blockade.

The blockade was put into effect by the Nigerian Maritime Administration and Safety Agency, known by its acronym NIMASA.

The agency said it had "served detention notices/orders on vessels belonging to/chartered by the Nigerian Liquefied Natural Gas Company Limited (NLNG)."

NIMASA spokesman Isichei Osamgbi denied that the agency was involved in any court case with NLNG and alleged the firm owed far more than the $20 million it said it paid, but declined to provide specific figures.

Nigeria exported some 19.6 million metric tons of LNG in 2012, the fourth-largest output worldwide, according to data compiled by research firm IHS. Qatar was first with 74.2 million metric tons.

LNG is natural gas transformed into liquid via a super-cooling process so it can be transported on tankers. It has represented around 9% of global gas demand, according to figures from the International Energy Agency.

Copyright Agence France-Presse, 2013

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