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Oil Pipeline Attack Breaks Months Of Truce In Nigeria

Nigeria

Just as Nigeria’s government and militants in the restive Niger Delta have managed to reach a kind of fragile truce with talks, amnesty funding, and incentives, a pipeline close to the Warri oil hub was attacked by suspected rebels in what was the first sabotage against the country’s oil facilities in months.

Militants attacked on Saturday a pipeline operated by the Nigerian Gas Company Limited, a subsidiary of the Nigerian National Petroleum Corporation (NNPC), Nigeria Gas Company spokesman Violin Antaih told AFP on Tuesday.

It has been confirmed, even by the community people, that it was a third-party sabotage,” Antaih told AFP.

According to the Nigerian army, the military is aware of the incident, which is now being investigated.

Dolapo Oni, an energy analyst at Ecobank, commented for AFP that the attack was a “worrying” sign at a time when Nigeria is struggling to lift oil production and exit a recession.

This is probably a statement of intent, saying, ‘look, we can come back’. It looks like a warning signal,” according to the analyst.

While it may have been meant as a warning signal, the signal is worrying for Nigeria’s crude oil production, which has been gradually recovering in recent months after the attacks on oil infrastructure subsided.

Nigeria’s production had dropped from 1.95 million bpd in 2015 to 1.44 million bpd at the height of the attacks last summer. After the number of attacks on oil facilities diminished, the country is planning to lift crude oil production to 2.2 million barrels daily after completing repair work on the Forcados pipeline.

Related: Today's Stunted Oil Prices Could Cause Oil Price Shock In 2020

Earlier this month, Nigeria increased the budget for its amnesty program for militants from the Niger Delta almost threefold, to US$175 million (55 billion naira), in a bid to solidify the peace process in the oil-rich delta.

The country also plans to include illegal refineries in the Niger Delta in a new government initiative to group refiners into the so-called ‘modular refineries’ consortium concept, aimed at dissuading perpetrators from attacking oil infrastructure.

By Tsvetana Paraskova for Oilprice.com

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