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Analysis: Chevron Nigeria shuts down
Nigeria, Abuja (SPX) Nov 21, 2008 U.S. oil company Chevron has suspended a large portion of its contracts for oil exports out of Nigeria following an attack by armed militants on one of its major supply lines. Chevron officials in the oil-rich West African nation said Thursday they were declaring a force majeure until the end of 2008 on oil exports from its Escravos facility in the Niger Delta, where armed gunmen last week attacked the pipeline, halting production said to be 90,000 barrels per day. While Chevron officials said they were working to repair the problem, they would not say when they expected the facility to reopen. The company's declaration Thursday followed an effort by gunmen earlier in the day to attack oil facilities in the region near the Escravos terminal. The Nigerian military said the armed men arrived in 10 speedboats, though they were repelled. Chevron's Nigerian operation has been beleaguered by continuous attacks by militant groups such as the Movement for the Emancipation of the Niger Delta. In June the company declared another force majeure on its oil exports following a particularly destructive attack on one of its installations by Nigerian militants in the delta. Though Chevron claimed at the time that production was not stymied by the attack, Nigerian energy officials estimated the assault cost the U.S. company about 100,000 barrels a day in production. Production in the delta has dropped considerably in recent years due to a steady increase in militant attacks on oil installations since 2005. Nigeria's decline in oil production has been blamed predominantly on militant groups like MEND. The delta is home to the vast majority of Nigeria's oil production; however, its residents remain mired in abject poverty. The country that once dominated oil production in Africa has pumped more than $300 billion worth of crude over the last three decades from the southern delta states, according to estimates. Nigeria's high unemployment in the delta, environmental degradation due to oil and gas extraction, and a lack of basic resources such as fresh water and electricity have angered the region's youth, who have taken up arms, many times supplied by political leaders, and formed militant groups and local gangs. Grievances with oil companies operating in the delta also have given rise to labor strife among U.S. and other foreign oil companies operating in the delta, including Chevron, said Rolake Akinola, a senior analyst for West Africa at the London-based consulting firm Control Risks. Earlier this year Nigeria's largest petroleum workers' union called for the removal of Chevron's managing director, citing allegedly unsafe work conditions and other grievances against the third-largest energy firm in the West African country. "These kinds of strike threats are a sort of trend (in the Niger Delta)," Akinola told United Press International. "That's the cycle we've seen in the oil industry." Strikes, coupled with attacks on oil installations, have severely hampered production over the last few years, reducing output once estimated at 2.5 million bpd by more than 20 percent. The company also faces its share of legal problems over allegations that the company colluded with the Nigerian military in the late 1990s to break up a protest at a village in the Niger Delta over Chevron practices. A lawyer for the villagers in the case, which is being tried in a San Francisco court, says, "Chevron paid, housed, fed, transported and supervised the military and police." Chevron attorneys counter that it was the company's right to protect its employees and call on local authorities, as the protesters had taken several employees hostage. Lawyers for the plaintiffs and protest leaders countered that the demonstration on the oil platform was peaceful and that Nigerian troops used excessive force. The case is being tried in the United States under the infrequently used Alien Tort Claims Act. Dating back to 1789, the act provides that foreigners can sue a U.S. company or other American entity in a U.S. court for human-rights violations committed in a foreign country. Chevron operations in Nigeria have been at the center of other controversies over the years, including several attacks on its operation in the delta. Related Links Powering The World in the 21st Century at Energy-Daily.com
Analysis: Uzbek-Malaysian energy ties
Washington DC (UPI) Nov 21, 2008Many Western observers see the Russian-Western "Great Game" over Caspian and Central Asian hydrocarbon resources essentially as a two-nation struggle, but the reality in the last few years is that other actors have entered the arena, playing nimble Velociraptors to Washington and Moscow's lumbering Tyrannosaurus Rex. The most notable newcomer is China, but other Asian nations have begun to dip their toes in the water, with South Korea earlier this year signing agreements with Uzbekistan for uranium. Now Malaysia's state-owned Petroliam Nasional Berhad, better known as Petronas, has entered the market, as part of an entourage accompanying Malaysian Prime Minister Abdullah bin Haji Ahmad Badawi on his recent official visits to Uzbekistan and Turkmenistan. |
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