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BLOOMBERG: Shell Says Nigerian Pipeline Attacked, Production Unaffected

March 6 (Bloomberg) — An oil pipeline run by Royal Dutch Shell Plc's venture in Nigeria was damaged in two attacks on March 3 that didn't affect output because production from the area has already been shut down, the company said.
Two manifolds on a pipeline run by the Shell Petroleum Development Co. (SPDC) venture that normally carries crude to the Forcados export platform were damaged in the assault, Caroline Wittgen, a spokeswoman in London, said in an e-mailed statement today.
“There were two new attacks by some unknown persons on SPDC's Agge and Agoro manifolds on the Trans-Forcados trunkline in Bayelsa State,'' Wittgen said. “These are areas from where we previously have evacuated staff and stopped production because of the security situation.''
Kidnappings and attacks last month on a Shell pipeline and Forcados forced the company to halt output of 455,000 barrels a day, about a fifth of Nigeria's daily production. Shell shut down all production in the western Niger River delta. Nigerian militants yesterday vowed to cut the West African nation's oil production by another 1 million barrels a day this month.
The militants failed to carry out their threat of a 30 percent shutdown in February.
Nigerian Oil Minister Edmund Daukoru said in an interview in London today that Shell probably will be able to fix the damage to Forcados in two weeks. He said he is concerned that the attacks may hinder Nigeria's ability to develop spare production capacity.
`Not Responsible'
The group behind last month's kidnappings and attacks, known as the Movement for the Emancipation of the Niger Delta, or MEND, said that it wasn't responsible for the March 3 damage to the pipeline and that local villagers may have done it.
“We know nothing about this, which may have been done by communities,'' Jomo Gbomo, a MEND spokesman, said in an e-mailed response to questions.
Nigeria produced 2.36 million barrels of oil a day in January, making it the sixth-biggest producer in the Organization of Petroleum Exporting Nations, according to Bloomberg data.
The fifth-biggest supplier to the U.S., Nigeria produces low sulfur, or sweet, crude oil, prized by refiners for the proportion of high-value gasoline it yields.
The militants on March 1 released six of the nine foreign hostages, including an American, two Egyptians, two citizens of Thailand and one from the Philippines, whom they kidnapped from a Willbros Inc. boat on Feb. 18. They are still holding two U.S. citizens and one Briton.
Release Demands
The Shell venture pumps about half of Nigeria's total oil production. Exxon Mobil Corp., Chevron Corp., Total SA and Eni SpA also have ventures with the Nigerian state-oil company.
MEND is demanding that the government release Diepreye Alamieyeseigha, a former governor of Bayelsa state, who was impeached and arrested on money-laundering charges, and Mujahid Dokubo Asari, a militia leader who is in jail on treason charges. Asari is in and out of trial. The governor, who has said he's innocent, is awaiting a court appearance.
The militants also want Shell to pay $1.5 billion to the Ijaw people, the biggest ethnic group in the Niger delta, as compensation for alleged environmental damage.
“SPDC is concerned about the likely effects on the environment of the oil spills resulting from the recent attacks on its pipelines and manifolds,'' Wittgen said. “In the current security situation our teams cannot go to those areas to assess the impact of the spills, effect repairs and begin the clean up of spills.''
Karl Maier in Khartoum at [email protected]

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