Tuesday, April 22, 2008

Oil company cuts production as Nigerian militant attacks continue

LAGOS, Nigeria — Nigerian militants announced fresh attacks Monday against oil facilities and a leading producer said exports could be affected, helping send oil prices to record levels.

A Royal Dutch Shell PLC joint venture said it may not be able to cover some April-May supply contracts totalling 169,000 barrels per day of crude after the militants sabotaged a pipeline last week in southern Nigeria, where militancy and lawlessness has grown in recent years.

The Movement for the Emancipation of the Niger Delta, or MEND, took credit for that attack, and said Monday that its fighters hit two more pipelines that it believes are operated by Chevron Corp. and the Shell joint venture in southern Rivers state.

Shell officials had no immediate information on any new attack and the Nigerian military battle group that patrols the oil region's waterways said it had no reports of overnight violence. Officials from Chevron could not immediately be reached for comment.

But word of the attacks, on top of a rocket strike Monday against a Japanese oil tanker off the east coast of Yemen, sent oil prices spiking to a record $117.40 a barrel.

Nigerian militants say they are stepping up their activities after the arrest of one of their leaders, Henry Okah, who is on trial for terrorism and treason.

On Monday, militants called on former U.S. president Jimmy Carter to mediate, after receiving no reply from President George W. Bush and actor George Clooney to similar requests. Carter is in the Middle East for peace talks.

"The ripple effect of this attack will touch your economy and people one way or the other and hope we now have your attention," MEND said in a statement.

The militant group emerged in early 2006, launching bombing attacks on Nigeria's oil infrastructure that cut about one-quarter of the usual oil output in Africa's biggest crude producer. Nigeria is a top supplier of crude to the United States.

The militants say they want the country's oil wealth distributed more evenly to help poor regions. But many of the various armed groups in the southern Niger Delta region have links to corrupt local politicians.

Both militants and government officials are suspected of heavy involvement in the theft and resale of crude oil, which oil industry officials say brings revenues that run into the millions of dollars per day.

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