(Updates with closing share price in eighth paragraph.)
Dec. 21 (Bloomberg) -- Royal Dutch Shell Plc, Europe’s largest oil company, shut its 200,000 barrel-a-day Bonga field off Nigeria after a leak during a tanker loading caused what may be the country’s worst offshore spill in more than a decade.
An export line from the field’s floating production, storage and offloading vessel was probably the cause of the leak, estimated at below 40,000 barrels of crude, Shell said in a statement today. The oil flow has been halted, it said.
“We’re aware of the incident and we’re working hard with Shell to contain the spill,” Idris Musa at the National Oil Spill Detection and Response Agency said today from the capital.
The leak is expected to be the worst since a January 1998 Exxon Mobil Corp. spill dumped an estimated 40,000 barrels into the sea from its Idoho platform, with slicks reported as far west as Lagos. Shell, the largest foreign oil producer in Nigeria, has been criticized by some local people and foreign groups for spills of crude from its onshore fields.
The Anglo-Dutch company, operating in Nigeria since 1937, says most spills occur because of pipeline sabotage and oil theft and it has set up a website to disclose data on leaks.
“Spill response procedures have been initiated and emergency control and spill risk procedures are up and running,” Tony Okonedo, a Shell spokesman, said by phone from Lagos, the commercial capital. Shell is sorry for the leak, Mutiu Sunmonu, its Nigerian chairman, said in the statement.
Bonga, Nigeria’s first deepwater discovery, produces almost 10 percent of the country’s crude 120 kilometers (75 miles) off the coast. Shell planned to export five cargoes of 1 million barrels each of Bonga crude every month from December to February, loading programs obtained by Bloomberg News show.
Shell pared an advance of as much as 1.4 percent in London trading to close the day up 0.4 percent at 2,288 pence. Shell’s American depositary receipts climbed 0.4 percent to $71.79 at the close in in New York.
“They averted a potentially much more serious situation, they figured it out very quickly,” Fadel Gheit, an analyst at Oppenheimer & Co. in New York, said in a telephone interview today. “I think the market is recognizing the responsiveness of the company.”
Gheit, who has an “outperform” rating on Shell’s American depositary receipts and owns some, said he’s glad “sanity prevailed” on the stock market. While the amount of oil spilled is substantial, he said, this isn’t a “runaway field” like what BP Plc dealt with in the Gulf of Mexico last year.
Yesterday Shell said a Gulf of Mexico drilling operation will stop for weeks after spilling 319 barrels of drilling fluid.
--With assistance from Sherry Su in London and Edward Klump in Houston. Editors: Tony Barrett, Charles Siler
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