Lagos - Nigeria wants Royal Dutch Shell to reopen one of its main pipelines, but the oil multinational is resisting, analysts say, for fear it could once again be bombed by militants.
The Trans Forcados Pipeline, the main feed to the 400000-barrel-a-day (bpd) Forcados export terminal, has been shut for all but three weeks of the past year, Lagos-based SBM Intelligence said in its weekly risk analysis published on Friday.
In their most sophisticated attack, militants used divers to blow up an underwater section of the pipeline in the Atlantic a year ago. Defying militant death threats, Shell flew in underwater engineers who took seven months to get the pipeline operational. Two days later, the militants bombed it again.
Shell Nigeria lost $3 billion (R39 billion) during the seven months of repairs, Africa Confidential newsletter estimated at the time.
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“Nigeria wants Royal Dutch Shell to reopen a major export pipeline in the Niger Delta, but the oil major wants better protection first, to avoid having it blown up yet again,” SBM Intelligence said, quoting unidentified officials and industry sources.
Shell Nigeria said only that one of its priorities is to secure the pipeline, while indicating it is still working to contain leaks. “Our focus on the Forcados leaks is on containment, spill recovery and securing the line,” spokesman Precious Okolobo said on Saturday.
Petroleum Minister Ibe Kachikwu announced last month that Nigeria, one of Africa’s top oil producers, lost between $50 billion and $100 billion in oil revenues because of militant attacks last year. At the worst point, he said, production was cut to 1.2 million bpd - a loss of 1 million bpd and the lowest rate of production in 30 years.
The Forcados terminal handles nearly one-quarter of Nigeria’s exports. So experts are puzzled by the state oil company’s declaration this week that production has risen to 2.1 million bpd - near optimal production of 2.2 million.
Oil militants say careless production in the southern Niger Delta has brought nothing but misery, with pollution from oil spills destroying farmlands, fishing grounds and millions of livelihoods.