Nigerian oil zone faces renewed insurgency

Armed militants in Nigeria's main oil-producing region appear to be cranking up an old insurgency targeting foreign oil companies as the West African giant seeks to boost production to 4 million barrels per day. Nigeria is Africa's biggest oil producer with an output of 2.5 million barrels a day. Much of that is exported to the United States. The Movement for the Emancipation of the Niger Delta, the core of Nigeria's oil industry, claimed March 3 that it killed four officers of the marine police at a checkpoint in the delta's Nembe River. That attack followed a Feb. 4 bombing of an oil pipeline in the same region used by Eni of Italy, one of the international oil majors that produce most of Nigeria's crude. Eni said the pipeline attack in Bayelsa state resulted in the loss of 4,000 barrels of oil a day. "This … is a sign of things to come," MEND said in a communique and warned it was ready to attack oil ships around the offshore oil fields along the Atlantic coast. "We will launch rockets at … uncooperative vessels and ensure such vessels are set alight when we eventually board," the communique added. If that happens, it will intensify a growing problem with pirates off the West African coast, which has become a major oil producing zone over the last few years. Nigerian President Goodluck Jonathan, who hails from Bayelsa, has blamed the region's security problems for the slow pace of development in the oil zones. Another factor is the political squabbling that has delayed parliamentary passage of a Petroleum Industry Bill designed to overhaul the energy badly regulated industry. There seems little prospect of it being approved anytime soon as Jonathan's administration grapples with political unrest, rivalry between the Muslim north and the Christian south and a growing terror campaign in the central zones by Islamist fanatics alleged to have links with al-Qaida's affiliate in North Africa. The steady increase in oil production in Angola, a major producer further south, underlined how badly Nigeria was lagging behind, Jonathan said. This is due largely to oil companies' reluctance to explore new fields. France's Total is expected to have its big offshore Usan field onstream soon, possibly in April, with an output of 130,000-160,000 barrels per day. But that's the exception rather than the rule and a major resurgence in MEND attacks will likely discourage other oil companies. A sharp increase in piracy off West Africa, particularly in the Gulf of Guinea and the Bight of Benin, in the last two years has deepened the security crisis. Shell Executive Vice President Ian Craig said Feb. 21 that Nigeria could produce 4 million barrels of oil a day but is prevented by a government that barely functions, along with corruption and massive theft of crude from pipelines. MEND launched its insurgency in 2005 in the swamplands and creeks of southern Nigeria but the violence ebbed when the government introduced an amnesty in 2009. That was good news for the foreign companies like Shell have operated in the delta for 50 years. They provide the oil that's the backbone of Nigeria's economy and fuels the rampant corruption in the state and federal governments. MEND's main demand has been a more equitable share of that the oil proceeds for the impoverished tribes of the delta, where most people eke out a living on $2 a day. They exist in poverty surrounded by rivers and creeks polluted by the oil industry and have little access to employment, schools or medical care. The insurgency resulted in Nigeria's oil production being slashed by 40 percent, while wholesale oil theft, a major industry in the south, cost the treasury around $1 billion a year. Craig said 150,000 bpd of oil is stolen in the delta, despite the 2009 amnesty and pledges of stipends, employment and training course that led to many insurgents to hand in their guns. But the government hasn't kept its promises and the unrest seems to be bubbling once more. The level of violence is far lower than it was before the amnesty but with security forces concentrating on the religious bloodletting in the north, the still-neglected and unstable south could erupt again.