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. Analysis: Nigeria focuses on security

Earlier this month U.S. oil company Chevron suspended a large portion of its contracts for oil exports out of Nigeria following an attack by armed militants on one of its major supply lines.
by Carmen Gentile
Washington DC (UPI) Nov 27, 2008
Nigeria has established a new "security panel" aimed at ridding the oil-rich Niger Delta of gunmen and militants in the next three months.

The panel, made up of military officials, civilian authorities, government officials and intelligence officers, will embark on the ambitious effort of reducing violence in a region where armed gunmen's attacks on both onshore and offshore oil facilities have caused Nigeria's oil production to fall by 20 percent over the last few years.

Militants and gangs in the delta are blamed for tapping into oil pipelines, a practice commonly known as "bunkering," and the kidnapping of oil workers and other delta residents for ransom.

"We are all aware of the challenges we face in our maritime security," said Air Chief Marshal Paul Dike at the launch of the 12-person security panel earlier this week, Nigeria's Punch newspaper reported. "Recent developments in our waterways like illegal bunkering, kidnappings, hostage takings have become serious cause for concern to the government.

"These activities pose serious threats to national security," Dike added. "These acts of illegality, which include economic sabotage and armed smuggling, if not completely addressed, could undermine our national security interest."

While the panel has put forward an audacious agenda for remedying the delta's woes, the effort is not entirely unprecedented. Both the current administration of Nigerian President Umaru Yar'Adua and his predecessor, Olusegun Obasanjo, have tried, unsuccessfully, to make headway against the militant groups that have pledged to ramp up attacks in the delta.

The violence has also forced foreign oil interests to rethink their output expectations in the delta.

Earlier this month U.S. oil company Chevron suspended a large portion of its contracts for oil exports out of Nigeria following an attack by armed militants on one of its major supply lines.

Chevron officials in the oil-rich West African nation declared a force majeure until the end of 2008 on oil exports from Chevron's Escravos facility in the Niger Delta, where armed gunmen last week attacked the pipeline, halting production said to be 90,000 barrels per day.

While Chevron officials said they were working to repair the problem, they would not say when they expected the facility to reopen.

The company's declaration followed an effort by gunmen to attack oil facilities in the region near the Escravos terminal. The Nigerian military said the armed men arrived in 10 speedboats, though they were repelled.

Chevron's Nigerian operation has been beleaguered by continuous attacks by militant groups such as the Movement for the Emancipation of the Niger Delta.

In June the company declared another force majeure on its oil exports following a particularly destructive attack on one of its installations by Nigerian militants in the delta. Though Chevron claimed at the time that production was not stymied by the attack, Nigerian energy officials estimated the assault cost the U.S. company about 100,000 barrels a day in production.

Production in the delta has dropped considerably due to the steady increase in militant attacks on oil installations since 2005.

Nigeria's decline in oil production has been blamed predominantly on militant groups like MEND. The delta is home to the vast majority of Nigeria's oil production; however, its residents remain mired in abject poverty.

The country that once dominated oil production in Africa has pumped more than $300 billion worth of crude over the last three decades from the southern delta states, according to estimates.

Nigeria's high unemployment in the delta, environmental degradation due to oil and gas extraction, and a lack of basic resources such as fresh water and electricity have angered the region's youth, who have taken up arms, many times supplied by political leaders, and formed militant groups and local gangs.

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Analysis: Iran seeks energy industry cash
Washington (UPI) Nov 26, 2008
As the Republican administration prepares to hand over power to President-elect Barack Obama and his team on Jan. 20, it can take pride in one facet of its foreign policy. The Bush administration's relentless pressure on Iran, ramping up sanctions via U.N. Security Council resolutions over Iran's nuclear energy program, has combined with longstanding American sanction regimens to deprive Tehran of significant fiscal resources to refurbish its aging hydrocarbons industry.

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