N’Delta Crisis: Shell Shuts in 180,000bpd
...As gunmen invade Nembe Creek Flowstation
By Chika Amanze-Nwachuku in Lagos, Segun James in Yenagoa and Gboyega Akinsanmi with agency report, 02.18.2009
The unabated crisis in the oil-rich Niger Delta has continued to take its toll on Shell Petroleum Development and Production Company (SPDC) and Nigeria’s oil revenue, as the company has been forced to shut in production of 180,000 barrels per day (“bpd) of oil following renewed attacks on its facilities.
Suspected loyalists of Kitikata, a militant leader linked with the recent killing of soldiers in the Niger Delta region, yesterday invaded the SPDC’s Nembe Creek flowstation in Bayelsa State.
The Nembe invasion, which took place in the early hours of yesterday, occurred barely one month after heavily armed militants stormed the crude oil loading platform in Bonny, Rivers State and shot at several vessels, which were carrying out legitimate businesses in the area. SPDC spokesman, Precious Okolobo, has, however, denied any attack on the company’s Nembe facility, saying activities were ongoing.
But Shell’s Chief Executive, Jeroen van der Veer, confirmed at a London conference that the lost production was due to the heightened insecurity in the region.
Prior to the attacks on its facilities, owing to the escalation of violence in the region in 2006, Shell was producing about one million barrels of crude oil per day.
The attacks had reduced the company’s production to about 400,000 barrels per day.
The recent shut in means a further reduction in the company’s production, a development which translates to revenue losses for the country.
Nigeria, the eighth largest crude exporter earns over 90 per cent of its foreign income from crude exports. The country had benchmarked its oil at $45 a barrel in the 2009 Budget and the new price of the crude, which stood below $36 per barrel yesterday is less than $9 above the budget target.
The upsurge in violence in the Niger Delta region has already reduced the country’s production to about 2.2 million barrels from 2.5 million barrels per day.
THISDAY had last Friday reported that oil producing companies operating in the region had suspended further redeployment of expatriate staff in the area pending when normalcy would return.
An official of Shell was last week quoted as affirming that the company had commenced preparations to evacuate its staff from the Niger Delta after a militant group issued a warning to quit the region or risk more attacks.
The spokesman had, however, stated that the company had no plans to leave Nigeria but that at the same time was not prepared to gamble with the safety and well-being of its workers and contractors.
A militant group led by Ateke Tom had accused Shell and other oil operators including Agip, the local subsidiary of Italian oil company Eni, and the Nigeria Liquefied National Gas Company of helping the Nigerian military to carry out attacks on the group's camps in Rivers State.
The dreaded Movement for the Emancipation of the Niger Delta (MEND), which threatened swooping attacks on oil companies in the region has issued a three-day ultimatum to Nigeria Agip Oil Company, (NAOC) and its sister company, Saipem, to vacate their operational bases in the region or face the wrath of the militia group.
The invasion of the multi-billion dollar Nembe Creek flowstation was said to have been repelled by soldiers on guard duties aboard the facility.
It was, however, not clear whether there were casualties during the incident, but THISDAY gathered that the gun battle with the attackers lasted several hours before the men escaped in their boats.
The armed groups were said to have left a letter chronicling a number of demands from the Shell management, prompting security agents to believe that the attackers might be local boys from the Nembe area.
The militants, in the said letter, had accused Shell of “being insensitive to the plight of the people of the area by refusing to implement agreements reached with them in various Memorandum of Understanding signed with the people”.
Part of their demands were that their militia group should be recognised by the SPDC management as a major interest group and must be placed on a stipend of N3 million monthly.
The Media Assistant to the Bayelsa State Chairman of the Niger Delta Peace and Conflict Resolution Committee, Alphine Ogoh, however, said yesterday’s incident was not an attack but that the militia group had gone to the platform to drop letter for SPDC.
Following the incident, the Joint military Task Force (JTF) has deployed more men to the facility to prevent another attack even as MEND has distanced itself from the operation.
MEND had earlier indicated its intention to resume hostilities along the creeks of the Niger Delta by ordering two Italian oil companies to move out of the region in three days.
In an ultimatum sent through an e-mail message, the group warned the two companies to take its fore warning seriously or be ready for the consequences of any attack.
MEND, which some months ago suspended attacks on oil installations in the region, had alleged that the Federal Gover-nment, in collaboration with the Italian Government was planning to wipe out the freedom fighters in the region.
