Wednesday, April 23, 2008

Shell reports 169,000 bpd output loss in Nigeria

LAGOS (AFP) — Anglo-Dutch oil group Shell Tuesday reported output loss of 169,000 barrels per day following the sabotage of its key supply pipelines in southern Nigeria.

"Generally, we have a shut-in of 169,000 bpd as a result of the recent attacks on our pipelines," Shell spokesman Precious Okolobo told AFP.

He said the production loss followed a weekend explosives attack on a pipeline feeding the Bonny exports terminal and Monday's sabotage of the Soku-Buguma and Buguma-Alakiri pipelines.

Okolobo said efforts were being made to "assess the extent of damage to the pipelines with a view to fixing them."

Shell said on Monday that it might not be able to honour contracts for April and May after a militant group attacked the key pipelines.

Bonny along with the terminal at Forcados east are Shell's most important installations in Nigeria.

The Movement for the Emancipation of the Niger Delta (MEND) militant group, active in the west African country's oil-rich south, claimed responsibility for the attack on the Bonny terminal in an email on Monday.

The attack, in Rivers State, was part of MEND's "Operation Cyclone" which the group said was "aimed at crippling Nigeria's oil export industry."

Oil prices rocketed to a record high point of 118.05 dollars per barrel on Tuesday, lifted by the Nigerian unrest, weakness of the dollar and OPEC's reluctance to raise short-term output, traders said.

Later on Tuesday, New York's main oil futures contract, light sweet crude for delivery in May, stood at 117.77 dollars, up 29 cents from the price on Monday. The contract expires at the close.

Shell, Nigeria's largest oil operator accounting for around half of the country's 2.1 million barrels per day output, has seen a wave of attacks on its facilities in recent months.

Overall, violence in the southern Delta region has reduced Nigeria's total production by a quarter since January, 2006.

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