Nigeria loses 120,000 bpd after pipeline attack: industry

ABS-CBN News

Posted at Jun 21 2008 09:49 PM | Updated as of Jun 22 2008 05:49 AM

Agence France-Presse

LAGOS - Nigerian militants blew up a key oil supply pipeline operated by US oil group Chevron, slashing output by 120,000 barrels per day, military and industry sources said Saturday.

"The attack took place yesterday (Friday) near Escravos. The supply pipeline was blown up. The company has shut down operation in the area," military commander Brigadier-General Wuyep Rimtip told AFP.

The latest attack came as Anglo-Dutch oil giant Shell declared force majeure on 225,000 barrels per day for June and July deliveries from its offshore Bonga oilfield in Nigeria, following an attack by militants on Thursday.

Industry sources said Chevron had declared force majeure, halting 120,000 barrels per day output.

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

Rimtip said the attack on the Abiteye-Olero crude oil lines could have been carried out by militants using dynamites and rocket propelled grenades.

"We have launched a manhunt for the attackers," he said, adding that no one was hurt in the incident.

No group has claimed responsibility for the latest attack. The raid on Shell's Bonga offshore oilfield was claimed by the Movement for Emancipation of the Niger Delta (MEND).

Chevron operates and holds a 40 percent interest in 13 concessions covering 2.2 million acres (8,900 square kilometers), predominantly in the onshore and near-offshore regions of the restive Niger Delta.

Last year its total production from 32 fields averaged 353,000 barrels per day of crude oil, 14 million cubic feet of natural gas and 4,000 barrels of liquefied petroleum gas (LPG), according to its website.

According to the International Energy Agency statistics, Nigeria produced average 2.13 million bpd in 2007, making it the 13th biggest producer in the world.

It was until recently Africa's largest producer before it was overtaken in April by Angola.

Production losses in Nigeria have contributed to the surge in oil prices over the last two years.

For the last two years, Nigeria has lost about a quarter of its daily production because of attacks on pipelines and terminals and the kidnapping of key staff, foreign and Nigerian.

Production is stuck at around two million barrels a day where Nigeria was aiming for four million by 2010.