Nigeria LNG to Pay Vitol, Glencore $380m Compensation

By Adedapo Adesanya

Nigeria’s sole liquefied natural gas (LNG) producer, Nigerian LNG, will pay $380 million in compensation to trading houses, Vitol and Glencore, after their gas supplier, trading firm, Taleveras, won a legal battle against the Nigerian entity in a London court.

According to Reuters, the compensation will be for non-delivery of cargoes.

The case heard in London’s High Court and Court of Appeal is the latest in a string of lawsuits brought by buyers against sellers and producers for non-delivery of cargoes after gas rallied from lows plumbed during the COVID pandemic when Russia invaded Ukraine in February 2022.

Taleveras, which was founded in 2004 by Mr Igho Sanomi, one of Nigeria’s independent energy traders and based in Dubai, the United Arab Emirates (UAE), sued NLNG, also involving Shell TotalEnergies and Eni as partners in 2021.

These three companies are minority shareholders in NLNG, along with the Nigerian state-owned oil company which has 49 per cent.

NLNG runs Nigeria’s biggest LNG plant, which covers around 5 per cent of global supply.

NLNG said it was reviewing the ruling while other parties including Shell, Eni, and TotalEnergies have not said anything, according to Reuters.

Court proceedings focused on 19 cargoes that NLNG had been due to deliver to Taleveras in 2020-2021.

Taleveras had pre-sold some of these cargoes to Vitol and Glencore, according to court documents.

The trading houses took legal action against Taleveras for the non-delivery and this eventually led to a chain of litigation.

The lost appeal means NLNG will need to pay Vitol around $260 million and about $120 million to Glencore, the documents said.