Monday, May 15, 2006

Nigerian pipeline blast upsets oil supplies

Further concerns with the world’s supply of fuel were heightened Friday after a pipeline in Nigeria exploded killing up to 200 [BBC]. The blast was believed to have been triggered after thieves attempted to tap illegally into the high pressure pipeline. It is not the first time that such an incident has occurred in the African state. Similar incidents have killed 2000 people in recent years. The oil industry has been the subject of continued unrest in the country with rebels belonging to the Movement for the Emancipation of the Niger Delta mounting attacks citing that the Nigerian people “were not benefiting from the riches under their feet.” Major-General Godswill Tamuno told the BBC that M.E.N.D was fighting for "total control" of the Niger Delta's oil wealth, saying local people had not gained from the riches under the ground and the region's creeks and swamps [BBC]. The wave of attacks on oil installations and kidnapping of foreign oil workers has reduced output by 25%. One country which has heavily invested in the Nigerian oil industry is China. In April this year a deal was struck to invest in excess of $4 billion into the country’s oil infrastructure [BBC]. China has made a commitment to buy a controlling stake in Nigeria's 110,000 barrel-a-day Kaduna oil refinery and build a railroad system and power stations. Nigeria, Africa's top oil exporter, has long been viewed by China as a partner. China’s state run oil company CNOOC saw its shares drop 2.36% on Monday, though how much might be attributed to the blasts in Nigeria is unclear. Sinopec, China’s second largest oil company, may also see dips in share prices. In 2003 Sinopec commenced operations in the Stubb Creek field in the Niger Delta with an annual output in excess of 200,000 tonnes or 4,000 barrels per day. Lower oil prices also affected other prices worldwide with Brent Crude down and stocks in the US affected. President Olusegun Obasanjo has launched an inquiry into the blasts [BBC]
Dec 2004: At least 20 killed in Lagos
Sept 2004: At least 60 killed in Lagos
June 2003: At least 105 killed in Abia State
Jul 2000: At least 300 killed in Warri
Mar 2000: At least 50 killed in Abia State
Oct 1998: At least 1,000 killed in Jesse
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