Shell Scrambles To Clean Nigeria Oil Spill

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December 22, 2011

LONDON — Royal Dutch Shell PLC (RDSA) is sending ships and planes loaded with chemical dispersants in an effort to clean up as much as 40,000 barrels of crude oil spilled into the Gulf of Guinea, the head of the company’s Nigerian operations said Thursday.

Shell said production at the 200,000 barrel a day Bonga field offshore Nigeria has now been completely halted after a leak occurred Tuesday during a tanker loading operation, resulting in what may be the country’s worst oil spill in more than a decade.

“To accelerate the clean-up at sea, we are deploying vessels with dispersants to break up the oil sheen at sea. We are mobilizing airplanes that will support the vessels in this operation,” said Shell Nigeria Chairman Sunmonu.

The company said that “up to 50% of the leaked oil has already dissipated due to natural dispersion and evaporation,” but this hasn’t been independently verified. Nigeria’s Department of Petroleum Resources and the National Oil Spill Detection and Response Agency weren’t immediately available for comment when contacted by Dow Jones Nigeria.

Shell said it believes the leak occurred during a routine operation to transfer crude oil from Bonga’s floating production, storage and off-loading vessel to a waiting oil tanker. An export line connecting the vessel to the tanker was closed off and the oil flow halted.

The spill is likely Nigeria’s worst since Exxon Mobil Corp.’s (XOM) Idoho platform leaked an estimated 40,000 barrels into the sea in 1998. The incident is Shell’s first major offshore oil spill in Nigeria, although the company’s operations onshore the West African country have been blamed for decades of pollution by environmental and human rights groups.

Sunmona reiterated that he was very sorry the spill had happened. “Let me also mention that we are currently working with the Nigerian government to inform local communities and fishermen about the situation,” he said.

Bonga, which lies 120 kilometers off the Nigerian coast, is one of Nigeria’s largest oil fields, contributing around 8% of the country’s crude loadings in 2011, according to JBC Energy.

The spill is likely to lend support to Atlantic Basin light crude and could have extensive price consequences if volumes are taken out of the market for a long time, said JBC.

-By Alexis Flynn, Dow Jones Newswires

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