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Nigerian oil rig attack delays shipments

Anglo-Dutch oil giant Shell declared on Friday force majeure on 225,000 barrels per day for this month's and next month’s deliveries from its offshore Bonga oilfield in Nigeria, following an attack by militants.

Force majeure is a legal clause allowing producers to miss contracted deliveries because of circumstances beyond their control.

Thursday’s attack was carried out by the Movement for the Emancipation of the Niger Delta (MEND) — the best equipped and most organized of the armed groups operating in the Niger Delta. It forced Shell to halt production on the site.

Bonga lies 120km offshore and has a daily output capacity of 200,000 barrels of oil and 4.24 million cubic meters of gas.

Shell started production at Bonga in November 2005. By May last year, 100 million barrels of oil had already been exported from Bonga.

The Floating Production Storage and Offloading facility is one of the world’s biggest.

Shell has a 55 percent interest in Bonga while US giant Exxon Mobil has 20 percent, the Italian Agip 12.5 percent and Elf Petroleum Nigeria, part of the French Total group, 12.5 percent.

The attack was the latest in a series targeting Shell, which last week said it would not be able to honor this month’s and next month’s contracts from its Bonny terminal after MEND sabotaged key crude supply pipelines.

Shell had already declared a force majeure clause in contracts for April and last month’s deliveries from Bonny following the attack.

The company has been the target of several recent attacks.

Thursday’s attack on Bonga set alarm bells ringing in oil circles as such facilities had been previously considered out of the reach of the armed groups who stage regular raids on installations closer to shore.

It caused embarrassment in government circles, prompting the Nigerian House of Representatives to summon security chiefs and key oil figures, both from government and corporations, to an emergency meeting next week, industry sources said on Friday.

Among those invited to attend the meeting tomorrow are the chief of defense staff, General Andrew Azazi, the country’s oil minister, Odein Ajumogobia, top officials from all the oil majors operating in Nigeria and the head of the National Petroleum Corporation, Lawal Yar’Adua, the sources said.

MEND has vowed it will not take part in the talks — prompting Nigerian authorities to issue a warning against the militants.

“Militants in the region who continue to spurn the peace overtures of the Federal government must be prepared to face the full consequence of taking up arms against their fatherland in a vain and criminal attempt to overawe lawfully constituted authorities,” a presidential statement said.

Violence in the southern Delta region has already reduced Nigeria’s total oil production by a quarter since January 2006.

Nigeria on Friday ordered the arrest of perpetrators of the latest attack on Shell’s oilfield and called for tighter security at all oil facilities in the Niger Delta.

“[Nigerian] President Umaru Yar’Adua has directed the country’s armed forces and security agencies to take necessary action to apprehend the perpetrators of this latest act of national sabotage and bring them to justice,” a statement from his office said.

He also directed security to be beefed up at all oil installations in the area to forestall any further acts of “terrorism” by criminal elements in the region.

Nigeria was until recently Africa’s largest oil producer but was overtaken in April by Angola, according to OPEC figures. Angola produced 1.873 million barrels per day on average in April, trumping the 1.818 million produced by Nigeria.



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