Militants bomb pipelines in Nigeria, escalating region's fight with government

Associated Press • May 8, 2007 at 11:21 AM

LAGOS, Nigeria - Militants staged coordinated attacks on three pipelines Tuesday, inflicting the worst damage on Nigeria's vital oil infrastructure in more than a year and signaling an escalation in hostilities that caused world petroleum prices to spike.

The nearly simultaneous bombings followed last week's kidnappings of dozens of foreign oil workers in the restive Niger Delta oil region, where militants say they are trying to shut down Africa's largest crude exporter.

Analysts believe armed groups are stepping up attacks to demonstrate their relevance ahead of the May 29 installation of a new central government after disputed elections. Militants are demanding that the people of the impoverished region get a bigger share of the oil wealth.

The Movement for the Emancipation of the Niger Delta, the area's biggest militant group, claimed responsibility for the bombings. It promised more attacks before May 29, saying in an e-mail: "We will ... crown it with a final really embarrassing moment for (incumbent President Olusegun) Obasanjo's government."

Oil prices shot up over the intensified violence, with a barrel of Brent crude topping $65.56 in trading, up $1.12.

Attacks in this West African nation often send ripples through oil markets already jittery over instability in the Middle East. Nigeria's light, sweet crude is much cheaper to refine than heavier oils and its proximity to North America cements its importance as the fifth-largest supplier of crude to the U.S.

Militants claimed their bombs took out the entire network of pipelines leading to a terminal operated by the Italian company Agip, which can export up to 200,000 barrels a day.

But it was not immediately clear how much production was actually cut, since the Nigerian staff of Agip, a subsidiary of Eni SpA, were on strike for a second day and company representatives in Italy said they were unable to comment.

Nigeria has total production capacity of 3 million barrels a day, but protests and militant attacks already reduced that by 680,000 barrels before Tuesday's bombings.

If the latest attack wiped out the full capacity of the three Agip pipes, it would mean Nigeria's output is now down by almost a third.

Nearly 100 foreign oil workers have been kidnapped since the beginning of the year, including 29 last week.

But oil markets had become somewhat complacent over kidnappings, and pipeline bombings are a high-impact reminder of the ability of militants to damage Nigeria's exports, said Ian Pilcher, the Nigeria country manager for risk management company ArmorGroup.

April's marred elections, in which the ruling party was declared a landslide winner, are likely a factor in the increasing violence, analysts said.

"With the attention of the international press turned to Nigeria for the transition, it would seem a natural time for them to up the ante," Pilcher said.

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