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Thieves steal £2.8bn of oil out of Shell’s pipelines in Niger Delta

By Rob Davies In Port Harcourt, Nigeria: PUBLISHED: 20:59, 28 March 2012 |

Thieves siphoned up to $4.5bn (£2.8bn) of oil out of Shell’s pipelines in the Niger Delta last year, in a worsening epidemic that threatens to overwhelm efforts to reduce oil spills.

‘Bunkering’ – the industry term for stealing oil from pipelines – resulted in lost production of up to 100,000 barrels per day last year.

The sheer scale of the problem means SPDC – Shell’s joint venture with the Nigerian government – is losing more oil to bunkering than is produced by countries such as Tunisia and Ukraine.

Shell’s presence in Nigeria has come under increasing scrutiny  in recent months after a UN report pitched the cost of cleaning up oil spills in the delicate ecosystem of the Niger Delta at an initial $1bn.

The Anglo-Dutch company has admitted culpability for two spills and is set to pay out hundreds of millions of pounds in compensation.

But the firm insists 70 per cent of the oil blighting the waters of the Delta is caused by bunkering, meaning it is not legally obliged to compensate affected communities.

Patrick Agbo, who heads SPDC’s oil spill response efforts, pointed to Shell’s new NCTL pipeline, which has already been punctured 52 times in a matter of months since it opened. ‘In oil spills it is getting worse for us, in terms of attacks and intrusion,’ he said.

Shell (down 7p to 2216p) is also refocusing its attention on a potentially lucrative deepwater drilling project off the coast of Nigeria, in the Bonga field.

But the operation has run into trouble after it leaked thousands of barrels into the ocean off the West African coast.

The rising tide of theft and the associated environmental damage adds another troubled chapter to Shell’s turbulent history in Nigeria.

It paid out £9.6m in 2009 to settle a legal action accusing it of complicity in the execution of environmental activist Ken Saro-Wiwa and eight other leaders of the  Delta’s Ogoni tribe in 1995.


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