Nigeria’s government accused Shell Plc, Eni SpA and other shareholders of Nigeria LNG Ltd. of hamstringing efforts to boost liquefied natural gas exports to European countries looking to replace imports from Russia by refusing to allow additional feedstock from other companies.
According to a report by Bloomberg, if NLNG’s owners allow third parties to supply feedstock, the company will be able “to help ease the European Union’s gas crisis,” according to a statement by a spokesman to Minister of State for Petroleum Resources Timipre Sylva.
But the mainly western oil firms have refused unless it is provided at subsidized rates, the statement said.
The company, a joint venture between the state-owned Nigerian National Petroleum Co., Shell, Total Energies SE and Eni, can produce 22 million tons of the fuel annually.
NLNG’s current output is about 70% of installed capacity at its six-train facility, leaving the firm unable to “meet both domestic and international gas obligations,” according to the statement.
Nigeria is the leading crude producer on the continent, and also has Africa’s largest proven gas reserves of about 200 trillion cubic feet, most of which are unexploited, flared or re-injected into wells.
EU nations have committed to significantly reducing their dependence on Russian gas following President Vladimir Putin’s invasion of Ukraine.
While most of Europe’s natural gas imports arrive via pipelines, Nigeria was the fourth largest source of LNG to the EU and U.K. last year after the U.S., Qatar and Russia, according to the U.S. Energy Information Administration.
NLNG has long-term contracts to ship the fuel to terminals in France, Portugal, Spain and Belgium, its website says.
Sylva made the appeal for improved output at a meeting with Italy’s new ambassador to Nigeria, Stefano De Leo, in the capital, Abuja, on April 4, the statement said.
“At the moment, the EU wants to diversify its energy sources, especially gas, and Nigeria is very strategic to us,” De Leo said, according to the statement.
NLNG’s shareholders are building a seventh train that will increase the company’s capacity of the super-chilled fuel by about 8 million tons.
NLNG, NNPC, Shell, Total and Eni didn’t immediately respond to requests for comment.