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Vanguard (Nigeria): Hostages may be freed tomorrow: Federal Government, Shell lose $27.3m per day

By Funmi Komolafe, Omoh Gabriel, Kingsley Omonobi & Victor Ahiuma-Young
Posted to the Web: Thursday, February 23, 2006
ABUJA— THERE were strong indications in Abuja yesterday that the nine foreign oil workers kidnapped by Ijaw militants may be released in the next 24 hours following Federal Government’s agreement not to carry out any military attack or arrest the kingpins and their foot-soldiers whenever the hostages are released.
The Federal Government is already losing a total of $27.3 million per day to the activities of militants youths in the Niger Delta. From Shell Petroleum Development Company alone, government may have lost a total of $819 million in revenue from oil export as a result of the decision of Shell to shut in a total of 455,000 barrel of crude oil export per day for the month of January alone even as it has evacuated all its 600 workers in its Western division
Reliable security sources told Vanguard that the militants are also basing their commitment to release the hostages on the grounds that a trusted ally of theirs whose identity should be protected is allowed to come for the hostages.
In addition, the hostage takers want the government to guarantee that there will be no reprisal of any sort on them since they kept their promise of not harming the hostages.
Already, President Olusegun Obasanjo who is said to be monitoring the situation closely, is said to have told the Military High Command to create the atmosphere of non-confrontation around the creeks where the hostages are suspected to be held up.
According to the source, “we have reasons to believe that the hostages are so frightened that one or two of them may have fallen ill and the militants knowing the implications of anything happening to them would not want to incur the wrath of the Nigerian government as well as the international community.
FG loses $27.3m

Given an average oil price of $60 per barrel, the country is losing an average of $27.3 million from non export of crude by Shell. In a week, the country would have lost a total of $191.1 million while in a month, the loss would rise to $819 million if the crisis is allowed to linger.

Nigeria, a developing country with a myriad of social economic problem, needs every cent it can earn for developmental purposes. Shell on Tuesday said it had extended force majeure on Nigerian exports from the EA and Forcados fields after a string of militants attacks at the weekend. Forcados and EA off takes have been extended as of today.
Shell declared force majeure on liftings in January after a wave of militants’ attacks but extended it Tuesday after another string of attacks on its facilities at the weekend. The company, which pumps over 40 per cent of Nigeria’s oil, has shut in a total of 455,000 barrels per day as a precaution after militants at the weekend bombed the Forcados terminal, sabotaged two pipelines and kidnapped nine foreign oil workers. The militants snatched the nine oil workers—three Americans, two Egyptians, two Thais, one Filipino, one Briton—from a barge operated by US services company, Willbros, that was working on a Shell project off Forcados.
President Obasanjo, fearing that more attacks against the oil industry will force oil giants to pull out from the winding creeks of the Niger Delta thus leading to greater loss of revenue for the country, has ruled out military action to free the hostages. According to President Obasanjo, “we believe that very, very soon we should be able to reach the hostage takers. We’ve put in place a very powerful committee,” said Abel Oshevire, a spokesman for the Delta State government.
The panel is chaired by Chief Edwin Clark and will seek to contact the Ijaw youths who are holding the oil workers. The Niger Delta militants, in statements to the media, have said the men will not be released, and attacks on oil facilities will not stop until Shell pays $1.5 billion in compensation to polluted Ijaw communities.
On the international oil market scene, European oil refiners were taking the latest disruption to Nigerian crude exports in their stride because of ample supply, despite delays of more than two weeks in Forcados loadings, traders said Monday. Royal Dutch Shell was forced to shut in production feeding Nigeria’s Forcados export terminal and its 115,000 EA oilfield after militants bombed the terminal and sabotaged two pipelines.
Nigerian oil output was reduced last month after armed gunmen kidnapped four oil workers from the offshore EA field. Buyers since then have been looking for replacement barrels. “Refineries have already started working to solve the shortage because the problem started on January11,” a trader said Last month, Shell told traders that loadings of Forcados in the second half of February would be pushed into March, according to market sources.
For example, cargoes loading February 19-20 would load March 6-7, and those loading February 17-18 will load March 2-3. It was too early to say whether the rescheduled February loadings will be delayed further as a result of the latest disruption to supply.
In the meantime, refiners have taken measures to substitute the gaps in their supply of Nigerian crude. “There is lots of crude out there besides Forcados,” a trader said.
NLC appeals for hostages’ release
Meanwhile, the Nigeria Labour Congress (NLC) has appealed to militants holding the oil workers hostage to release them and ensure that no harm is done to the workers even as it acknowledged the political marginalisation of the Niger-Delta people.
In a statement in Abuja yesterday, the NLC president, Mr Adams Oshiomhole said: “The Nigeria Labour Congress (NLC) wishes to once again passionately appeal for the release of the nine oil workers being held in captivity since last Saturday. We strongly appeal that no harm be done to these workers.
“Oil workers, irrespective of their nationalities, are not responsible for the situation in the Niger Delta or for the immediate grievances being canvassed by our compatriots.
The NLC added that it “recognises that the political marginalisation and colossal injustices suffered by our compatriots in the Niger Delta area are real, legitimate and required to be redressed urgently.”
On efforts by the Federal Government, the NLC said: “While we endorse the strategy of negotiation adopted by the Federal Government, it bears emphasis that redressing the injustices requires fundamental political, welfarist and constitutional solution.”

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