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Nigeria increases Niger delta funds

08 May 2017 09:46 (+01:00 GMT)
Nigeria increases Niger delta funds

Cape Town, 8 May (Argus) — The Nigerian government has committed additional funding to the Niger delta in an attempt to ensure that a reduction in attacks against oil and gas facilities this year endures.

The annoucement comes as President Muhammadu Buhari left the country on 7 May to receive more medical treatment in London. Buhari spent two months receiving treatment in London earlier this year and he has been unable to attend cabinet meetings since his return. Vice-president Yemi Osinbajo will assume the presidency during Buhari's absence. The government has not said how long Buhari is scheduled to stay in the UK or revealed details about his medical condition.

An additional 35bn naira ($110mn) has been approved for the Niger delta amnesty programme. It will be paid to former rebels in monthly payments and training schemes, the government said. The additional funding may sustain a recovery in Nigerian oil production, which is currently around 1.7mn b/d. A series of attacks against oil and gas pipelines led to production falling below 1.5mn b/d in August last year.

The Trans Forcados pipeline has been shut since November following an attack, causing around 210,000 b/d of Forcados crude production to be halted. An earlier force majeure on Forcados crude exports since February last year also remains in place. And crude exports are frequently delayed from ExxonMobil's Qua Iboe terminal.

Nigeria regularly produced 2.5mn b/d in 2005 when rebel attacks started. The amnesty programme was first introduced in 2009 and has been credited with curbing attacks against oil and gas facilities by former rebel groups such as the Movement for the Emancipation of the Niger Delta (Mend).

Around N20bn was spent on the programme last year. Attacks by groups such as the Niger Delta Avengers have ceased this year because of the amnesty payments and talks between government officials and rebel groups. Criminal attacks against oil and gas pipelines has also fallen this year, according to state-owned oil firm NNPC.

A separate plan is under way to incorporate those behind hundreds of illegal oil topping plants in the delta into a formal "modular" refining programme. "This includes the development of the technical criteria for issuing operating licenses that is now in final stages of drafting and would be released soon," the government said. A strategy for community-based participation in "pipeline protection and policing" is also under way with host communities in the delta, it said.