Cannot create project after upgrading to 7.12.2

Upgraded a few days ago from 7.3.2 to 7.12.2, gitlab installed from source. Things seem to be working fine except for project creation. Whenever I try to create a project I get the error “Failed to create repository”. Same happens when trying to remove a project.

How can I debug this? The logs don’t show anything useful – in fact only production.log shows something. Looks like gitlab-shell isn’t called at all, since there’s no message in its log (with log_level: DEBUG)… Manually running gitlab-projects creates the repository just fine.

production.log:

Started POST "/projects" for my.ip at 2015-07-14 23:03:29 +0300
Processing by ProjectsController#create as HTML
  Parameters: {"utf8"=>"â", "authenticity_token"=>"[FILTERED]", "project"=>{"path"=>"test123", "namespace_id"=>"26", "import_url"=>"", "description"=>"", "visibility_level"=>"0"}}
Completed 200 OK in 81ms (Views: 25.9ms | ActiveRecord: 18.4ms)

Thanks

Stupid issue… I changed the first line of gitlab-shell to include the full path to ruby and it’s now fixed.

I’m facing same issue with 7.12.2 and updating the ruby to full path did not help.