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MarketWatch: Shell Nigeria restores oil flow through Nembe Creek pipeline

By Vincent Nwanma
Last Update: 5:55 AM ET Mar 26, 2007

LAGOS (MarketWatch) — Shell Petroleum Development Company of Nigeria, a unit of Royal Dutch Shell PLC has resumed pumping of crude oil through its Nembe Creek Trunk Pipeline, where a spill led to a shut-in of 187,000 barrels a day, a spokesman said Monday.

However, the Nigerian government has sued the oil company for alleged violation of nuclear safety and radiation law, according to media reports Monday.

“We have resumed pumping, but I cannot say how much it is now,” Bisi Ojediran said. “Normally, production will ramp up,” he said.

In early March, Shell shut production from flow stations that feed crude oil into the trunk line, and subsequently mobilized its engineers to repair the pipeline.

Shell owns 30% of the joint venture, Shell Petroleum Development Co, which operates the site where the spill took place. The state-run National Nigerian Petroleum Corp. owns 55% and units of Italy’s Eni SpA hold 5% and 10%, respectively.

Attacks by militants fighting for regional control of Nigeria’s oil have cut crude oil production by more than 600,000 barrels a day since last year.

Even with the restoration of the 187,000 barrels a day, Shell is still losing about 477,000 barrels a day to the attacks.

Ojediran said Shell wouldn’t comment on the government’s suit, “since the case is already in court.”

The government, according to the report, said Shell and three other companies – C and E Global Limited, Western Atlas, and E D Wayles – of transporting radioactive materials from Port Harcourt to Warri, both in the Niger Delta, without proper authorization.

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