FG, Militia Strike Deal on Final Release???

The Federal Government and the militia that kidnapped nine oil workers in the Niger Delta almost three weeks ago have struck a deal that would lead to the release of the three remaining hostages. The much-expected release of the last batch of hostages could not take place yesterday because of the non-harmonisation of positions.
Minister of State for Petroleum Resources, Dr. Edmund Daukoru, however, yesterday urged investors in the Nigerian petroleum sector not be deterred by the recent happenings in the Niger Delta, stressing that the hostage taking of oil workers by militants would soon be resolved.
The militants on Tuesday released six out of the nine hostages to the Delta State Government, which had been negotiating with the group on behalf of the Federal Government. The militants had vowed that the rest of the hostages would not be released until certain conditions were met.
But the Delta State Government led by the Secretary to the State Government, Dr. Emmanuel Uduaghan yesterday at a meeting with the Ijaw youths consolidated the 15 earlier conditions for the release of the hostages to just two.
Sources close to the meeting in Warri disclosed that the two conditions are that the Federal Government would not attack or arrest any of the militia and that an intercessory committee to be set up between government and the Ijaw militia.
The duties of the intercessory committee to be empanelled, according to sources at yesterday�s meeting include among others the discussion of the other 13 conditions, which include provision of infrastructure, social services and the release of former Bayelsa State Governor, Dr. Diepreye Alamieyeseigha and Asari Dokubo currently standing trial for mismanagement and embezzlement of state funds and treason respectively.
The militants, who have now been re-christened Federated Niger Delta Ijaw Congress (FNDIC), gave assurance that as soon as the intercessory committee takes off and reasonable progress made, the remaining three hostages would be released.
The group, which was formerly known as the Movement for the Emancipation of the Niger Delta (MEND) was led to yesterday�s meeting by its President, Mr. Bello Okoko.
THISDAY gathered that Delta State Governor, Chief James Ibori earlier summoned to Abuja for a meeting with the President was directing the conduct of the Warri meeting from the nation�s capital.
Meanwhile, Daukoru yesterday said in separate interviews granted the Cable Network News (CNN) and the Associated Press after his meeting with the US Energy Secretary Sam Bodman in Washington, that 75 percent of the total volume of crude oil production shut-in in Nigeria, were as a precaution to protect workers and not because of oil facility damage.
A total of 458,000 barrels per day (bpd) of oil production is shut in after Shell Petroleum Development Company (SPDC) shut down its operation in the west of the Niger Delta resulting to the loss of 445,000 bpd production while Chevron has shut down output of 13,000 bpd from its Makaraba flow station, following insurgence by militants.
“I am optimistic that the hostage taking of oil workers can be resolved soon… Once the hostages are released 75 percent of the lost production can be resumed within two weeks,” Daukoru said, adding, “most of the lost supplies reflects oil shut in as a precaution to protect workers and not because of oil facility damage.”
Speaking on the effect of the Niger Delta crisis on oil prices in the international market, Daukoru said that despite the shortfall in output from Nigeria, there’s plenty of oil with the global surplus expected to grow at current production levels.
Daukoru, who is also President of the Organisation of Petroleum Exporting Countries (OPEC) called $60 a barrel for oil a “fair price” and said oil prices should be kept at “an equilibrium with global economic growth,” while cautioning that if prices are allowed to edge toward $70 a barrel, “everybody gets nervous” about the impact on the global economy.
“In the second quarter, we forecast an overhang (of supply) of maybe 2 million barrels a day,” Daukoru said, maintaining there is not enough refining capacity to handle that amount of supply.
Daukoru declined to speculate what the cartel will do, but said its discussions “should be against the background of that anticipated overhang,” which he suggested could lead to a collapse in oil prices.
Nigeria’s security needs, he added, are different from those of say, Saudi Arabia, which thwarted an attack recently on its highly defended oil processing facility. Nigeria’s oil infrastructure is more scattered and “the best security is good relations with the local population,” Daukoru said.
He attributed much of the tightness of the world oil markets to a lack of refineries – not production decisions. He called the “fear factor” in the oil markets over possible major supply disruptions “totally out of proportion” to real conditions. “We do believe there is enough spare capacity” to produce more oil if needed, he said.
He also said he has no reason to believe that Iran would withhold oil from the markets because of its dispute over nuclear development. “They have clearly said they have no such intention and we have to believe them,” said Daukoru. “I have no reason not to believe them.”
Asked about President Bush’s recent call for the United States to end its addiction to oil, Daukoru said it was up to Americans to decide whether they are addicted.
“I don’t live in this country, so I can’t pass judgment whether energy is being used in wasteful ways,” he said, adding “conservation is not necessarily a bad thing.”
He said Nigeria is determined to expand its oil production as well as develop its large resources of natural gas, including participation in the growing global LNG trade.
He projected Nigerian oil production to grow to 4 million barrels a day by 2008 and to 4.5 million barrels a day by 2010.
When MEND first staged its uprising last month to demand for the release of Dokubo and Alamieyeseigha, it blew up a crude oil pipeline in the Escravos area of Delta State, which feeds the Warri refinery. The 125,000 barrels per day refinery was shut down last week after it ran out of supplies.
The militant group also attacked Shell EA offshore oil platform and four flowstations, killing more than 10 soldiers, while Nigeria also lost 221,000 bpd of oil production, translating to a daily loss of $14.4 million (N1.87 billion) revenue.
The spate of violence got bloodier when militants attacked the operational base of Italian oil firm, Nigerian Agip Oil Company (NAOC) in Port Harcourt also last month killing nine people including eight policemen.
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