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Royal Dutch Shell, Chevron Corporation: Niger Delta Avengers Agree to Peace Talks

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By Staff WriterJun 14, 2016

Screen Shot 2016-05-21 at 10.18.28Finally, Royal Dutch Shell plc (ADR) (NYSE:RDS.A), Chevron and other oil and gas companies can heave a sigh of relief as the militant group, Niger Delta Avengers has agreed to consider peace talks with the Nigerian government. The group has said that it does not have new demands, as it just wants foreign oil and gas companies to leave the southern region of the Niger Delta and stop oil pollution.

The group said it wants “genuine attitude” by the government and a “conducive atmosphere” to carry out dialogue. This is definitely good news for the Nigerian economy and international energy companies which have suffered badly in the past few months. The Avengers started to attack oil infrastructure in February, when they blew up Shell’s Forcados terminal and under-water pipeline.

The Niger Delta Avengers are not happy with President Muhammadu Buhari and the government’s crude oil policies. It believes the Nigerian officials and foreign energy companies have joined hands to deprive locals of basic facilities.

On its website, the group points out that while Chevron has not suffered any electricity outage in the past 40 years, the locals do not have access to clean water, hospitals and schools. The group states multi-national oil companies are living as “Kings” in Nigeria.

According to Nigerian National Petroleum Corporation, the attacks on Shell, Chevron, Eni SpA (ADR) (NYSE:E) have reduced Nigerian crude oil production by almost 700,000–800,000 barrels per day (bpd). The oil production has dropped to its lowest in 27 years in Africa’s biggest economy which is majorly dependent on crude oil for its revenue.

Peace Talks: Conditions?

Bloomberg reported quotes the Nigerian oil minister who states that talks between the Avengers and governments have begun. The group demands the officials to “commit independent mediators” for the proposed dialogues and to create a conducive and encouraging environment to facilitate the formation of the new energy framework. The militant group contends that only this type of negotiation can de-escalate the differences between the two parties and can bring long-term peace in the country.

While accepting the proposal to carry out talks with the government, the group has warned the oil and gas refineries to use local crude oil only. The Avengers said that if the refiners would not listen to the group’s demand and would bring their own crude from abroad, the Avengers would blow up their two major vessels.

Furthermore, the militant group has also warned Chevron Corporation (NYSE:CVX), Shell and other to not undertake any repair works on affected oil and gas facilities and pipelines in the Niger Delta until talks are completed. The group has named its operation, “Operation Red Economy.”

The Avengers have also warned the international energy companies of reviewing its “earlier stance of not” shedding blood. According to Ecobank Transnational Inc.’s crude oil analyst, Dolapo Oni, the group has threatened the government and energy companies to make its position look “stronger” before the talks. However, as in the past, the Avengers have fulfilled all their promises; the warning to refiners and human lives cannot be taken lightly.

Despite the warnings, Nigerian State Petroleum Resources Minister Emmanuel Kachikwu believes the negotiation would yield benefits for the country. The economy has already suffered a lot because of the attacks; it has lost its number 1 position as crude oil exporter in Africa and is expected to report worse gross domestic product (GDP) growth rate this year.

Editing by Mobin Nasir; Graphics by Rameez Ahmed

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