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Lloyds List: Shell puts safety first in Nigerian oil fields

Shell puts safety first in Nigerian oil fields
Staff protection to be boosted, writes Martyn Wingrove
Lloyds List; May 17, 2006

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ROYAL Dutch Shell is seeking tenders for up to 70 boats, hovercraft, landing craft and small ships to strengthen crew transport operations in its oil fields in Nigeria as it also seeks to boost security in the region.

The Anglo-Dutch oil major, which had its annual meeting yesterday, has been forced to rethink its security strategy in the Niger Delta after militant attacks damaged oil export infrastructure, according to chief executive Jeroen van der Veer.

Shell has sent out tenders for the mix of vessels to improve its personnel movements in the Niger Delta and renew the local fleet.

With the London-listed firm set to assess the damage of tribal attacks, it is also preparing for more trouble on its facilities amid fears that militants will also start to target liquefied natural gas plants.

Shell, the country's largest foreign oil producer, shut down its Forcados and EA tanker export facilities in February this year after militant attacks, closing off 455,000 barrels of daily oil production.

Speaking at the shareholders' meeting, Shell's head of exploration and production, Malcolm Brinded, said his engineers will be moving back to the oil fields and facilities to assess the damage caused by the attacks. They will also start environmental clear-up work.

'I cannot say when we will be able to return, but I think it will be in the coming weeks,' he said.

Militants claiming to be affiliated with the Movement for the Emancipation of the Niger Delta have threatened to expand their attacks to target the $8.5bn Nigeria LNG plant and pipeline network.

Analysts at Deutsche Bank think an attack on the Bonny Island plant could affect global gas markets, which are becoming more reliant on LNG deliveries.

'An interruption to LNG supply would significantly damage an already drum-tight LNG market,' the analysts said in a report.

The plant, which includes five LNG production trains, produces around 16.8m tons per annum and this is set to rise next year when a sixth train comes on-line.

Nigerian National Petroleum Corp owns 49% of the $8.5bn plant. Its partners are Shell (25.6%), Paris-based Total (15%) and Italy's Eni (10.4%).

– Bristow Group has gained a $53m extension to its contract to provide helicopter services to Shell Nigeria Exploration ' Production covering four aircraft. The two-year deal will see four helicopters operating in the country for two more years to March 2008.

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