Flagship Nigerian Crude Grade At Risk Over Protests At Exxon

A six-week-long blockade of ExxonMobil’s offices and oil facilities in Nigeria by former workers protesting their dismissals now threatens the normal production and exports of Nigeria’s flagship Qua Iboe crude grade, the U.S. supermajor, operator of the oilfields producing Qua Iboe, said on Sunday.

“The continued blockade means a loss of access for employees [and contractors]. Continued denial of access to production facilities could impact the company’s ability to safely continue production operations,” S&P Global Platts quoted ExxonMobil as saying in a statement.

Exxon is the operator with a 40-percent stake of the fields producing the Qua Iboe grade. The fields are located 20-40 miles offshore Nigeria’s southeastern region. The oil is pumped to the shore via a seabed pipeline system to the Qua Iboe terminal, and production and exports average around 320,000 bpd. Due to its qualities of light crude containing very low levels of sulfur, the Qua Iboe has high yield of gasoline and middle distillates, and is popular among refiners globally.

The blockade at Exxon started in the middle of July, when workers started to protest the dismissal of more than 800 security personnel that Exxon had engaged. The workers claim that they had been sacked without any severance pay and in breach of labor laws, and vowed to continue the protests until the laid-off workers are reinstated.

Exxon, for its part, told Platts that the despite the fact that the personnel were third-party direct employees, the U.S. company offered significant severance packages as agreed by all parties.

The protests continued even after the Nigerian Labor Ministry ordered last week the workers to stop their blockade, Exxon says.

According to the U.S. supermajor, the former employees threatened current employees with violence “and other actions that threaten production at one of Nigeria’s key joint venture assets,” says the Exxon statement, as carried by Platts.

By Tsvetana Paraskova for Oilprice.com

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