OilVoice - Militant Attacks in Niger Delta May Speed Up Exit of Oil Majors

Militant Attacks in Niger Delta May Speed Up Exit of Oil Majors

Tuesday, February 16, 2010

The Joint Revolutionary Council (JRC), a Nigerian military group, has claimed responsibility for an attack upon several key Royal Dutch Shell oil and gas installations in the troubled Niger Delta region.

Although the group's claims are yet to be independently verified, one thing is for sure, their timing is calculated to have maximum impact.

The attacks come against the backdrop of a period of political uncertainty in Nigeria. In addition, the violence serves as yet another reminder of the ongoing security risks that have prompted some international oil companies - including Shell itself - to consider moving out of their onshore assets in the Delta.

The JRC, which operates independently from the region's main militant group the Movement for the Emancipation of the Niger Delta (MEND), said it had blown up Shell's Tura manifold, which connects to the Bonny export terminal. It also claims to have attacked a pipeline in Chanomi Creek, which carries crude oil to the Kaduna refinery, as well as a gas pipeline to the city of Lagos.

The JRC's attacks come just days after Vice President Goodluck Jonathan assumed executive powers following President Umaru Yar'Adua's extended absence. Yar'Adua's absence, and the political uncertainty it has wrought, has led to a breakdown of the government's relatively successful amnesty programme. As a result MEND has called off its ceasefire. However, a statement released by the leading militant group in the region, in which the organisation said it would be 'watching developments' after Jonathan stepped into Yar'Adua's executive role, has raised hopes that increased political stability in Abuja would lead to greater security in the Niger Delta. If claims of the latest attacks are proven to hold true then such hopes may soon be quashed.

Abuja responded immediately to the resumption of militant attacks on February 12 by announcing the formation of a sub-committee for the protection of oil and gas assets in the Niger Delta. If the government is unable to ease security concerns in the region, however, rising militant activity may hasten the pace at which international oil firms are moving out of their Nigerian onshore assets and would likely reduce interest in a licensing round scheduled for later in 2010. As previously mentioned, Shell would likely to be the first oil major to make an exit.

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