Shell laments over rising attacks in Nigerian oil facilities as oil output recovers

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By Elisha Bala-Gbogbo

Security in delta region remains ‘major concern,’ manager says

Company’s local output averaged 631,000 barrels a day in 2017

Nigeria’s oil wells may be flowing again, but the country’s largest operator says attacks continue to put a brake on output.

“Security in parts of the Niger delta remains a major concern with persisting incidents of criminality, kidnapping and vandalism as well as onshore and offshore piracy,” said Igo Weli, general manager for external relations at Royal Dutch Shell Plc’s local unit. The warning underlines the enduring threat of attacks even as production recovers from a major militant campaign in 2016.

Shell declared force majeure on Bonny Light crude shipments last month following pipeline leaks, while loadings of Forcados exports were also delayed. Weli didn’t specifically link those incidents to his comments on vandalism.

Militant assaults on Nigeria’s oil infrastructure in 2016 cut the country’s output to less than 1.4 million barrels a day, the lowest in 27 years. While there hasn’t been a major attack since, the security situation in the oil region remains fluid, according to Weli.

“Facilities operated by both indigenous and international oil companies continue to be vandalized by attacks and other illegal activities such as crude-oil theft,” he said by email. “We are continuing to monitor the situation to mitigate any exposure and minimize risks faced by our personnel.”

Shell pumped an average of 631,000 barrels a day in Nigeria last year, about a third of the nation’s production. Despite the rally in output, the company still counted 60 cases of sabotage and theft, compared with 49 the year before. There were 10 such incidents recorded in the first two months of 2018, according to Weli.

Nigeria is scheduled to load at least 1.8 million barrels a day next month. That equals the production cap it agreed on with the Organization of Petroleum Exporting Countries, which took effect in January.

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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