Ineos declares ‘force majeure’ on Forties shipments

Ineos has declared force majeure on all shipments of crude oil, natural gas and condensates through its North Sea Forties Pipeline System that has shut off vital energy supplies to the UK.

Force majeure, which suspends a company’s contractual obligations in the wake of situations that lie beyond its control, is rare in the North Sea.

Ineos said: “We can confirm that formal Force Majeure has been declared on relevant contracts and we continue to work closely with our customers during this period, as well as local communities, Government and other stakeholders.

Oil and gas prices have soared since Ineos said earlier this week it would shut down its Forties Pipeline System, which delivers almost 40% of the UK’s North Sea oil and gas output, to repair a crack in the pipe just south of Aberdeen.

Trade body Oil & Gas UK said the shutdown has caused “significant issues” for the industry and that lost production is worth around £20 million per day.

“Continued assessment of the pipeline since Monday has confirmed that the hairline crack has stabilised and no further growth has been recorded for 48 hours.

“As a consequence, this morning we have been able to reduce the precautionary safety cordon from 300m down to 150m.

“This means the four residencies originally located within this area are now no longer within the cordon.

“The one family that had decided to relocate into temporary accommodation has now returned to their home.

“Given the proximity to the site the unclassified CK12 Netherley to Cookney road remains closed by the police and drivers are still advised to seek alternative routes.

“Safety remains our highest priority and local residents, FPS customers and other stakeholders are all being kept fully informed of the situation as it develops.

“A number of repair options are currently being assessed and developed.  At this stage it is still too early to say how long the repair will take to complete, but it is expected to be a matter of weeks rather than days.”