Portugal has said that it would face serious economic problems this winter if Nigeria does not deliver all the liquefied natural gas (LNG) it is due to it.
The European Union country’s environment and energy minister, Duarte Cordeiro, said yesterday however that the country is afraid Nigeria may fail following one reason or the other
Asked whether with many countries now looking for alternatives to Russian gas there was a chance that Nigeria might not meet its LNG supply volumes, Duarte Cordeiro said that while the government had given Lisbon assurances that it would do so, “there is a risk of it not complying”.
“From one day to another, we may have a problem, such as not being supplied the volume of gas that is planned,” Cordeiro told a conference in Lisbon hosted by CNN Portugal.
Cordeiro did not say what would prevent Nigeria supplying the LNG it was contracted to. Oil and gas output in Nigeria has been throttled by theft and vandalism of pipelines, leaving gas producer Nigeria LNG Ltd’s terminal at Bonny Island operating at 60% capacity.
Nigeria LNG, which is owned by state-oil company NNPC Ltd, Shell, TotalEnergies and Eni, did not immediately respond to a request for comment.
Although Portugal has its gas reserves at 100% of storage capacity, Cordeiro said that if fewer Nigerian LNG deliveries materialised, it would have to look for alternative supplies.
With other European countries doing the same, this would likely lead to higher imported gas prices, he said.
Portugal last year imported 2.8 billion cubic meters of LNG from Nigeria, or 49.5% of total imports, while the United States was the second-largest supplier with a share of 33.3%.
Its other suppliers include Trinidad and Tobago, Algeria, Qatar and Russia, the latter accounting for just 2% last year.
Portugal is “diversifying its suppliers to increase the country’s energy security”, Cordeiro said, adding that it is adopting strategies to lower gas consumption, while boosting its already high production of electricity through renewables.
“Portugal has been preparing, like all of Europe, for what will be a difficult winter,” he said, urging the European Commission to move forward with the implementation of a joint gas purchasing platform and defining import prices.