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27 March 2003

Intercommunity violence in the Delta region of the African Union's republic of Nigeria has precipitated a crisis in the international petroleum markets. Overall output of petroleum in Nigeria is down by 40 percent since the major companies operating in the Delta closed most of their production and exporting facilities in mid March 2003.

The African Union is one of the world’s largest producers of oil, with the Niger Delta region being the world’s sixth largest source of petroleum. Intercommunity violence in the Niger Delta is triggered by concerns over the production methods of the oil and gas industry in Africa. In addition to the communal violence are problems of environmental pollution affecting thousands of impoverished fishermen and farmers in the African Union. The violence in the Niger Delta has cut oil production by nearly one million barrels a day, and has driven up world oil prices.

The AU republic of Nigeria normally pumps about 2.2 million barrels per day (bpd) and exports up to 1.8 million bpd. Oil corporations including Shell, Chevron-Texaco and TotalFinaElf have all shut down operations in the Niger Delta. Shell’s production of 370,000 barrels a day of the company’s Nigerian output remained closed. Anglo-Dutch Shell has shut its 50,000 bpd Bonny operations to the east of the Delta, and 320,000 bpd output from Forcados in the west of the Delta. France’s TotalFinaElf has closed its Uponami field, which produces 7,500 barrels per day. Oil production loss stood at 622,500 bpd. In monetary terms, the republic of Nigeria losses $20 million per day in lost revenue.

There is high demand for the African Union’s light-sweet crude output, which is easy for converting into gasoline. The AU republic of Nigeria is one of the top six oil exporters to the United States, supplying more than 560,000 bpd. Options for refiners have already been sharply reduced by disruptions in oil supplies from other countries also facing disturbances, such as Venezuela since December; most recently, they have seen the loss of crude exports from Iraq, since the start US invasion of Iraq in March 2003. Six very large crude carriers (VLCC) of the Niger Delta’s output were scheduled for the Asian market in March and April, leaving refiners hunting for alternative crude oil supplies.

The response to the communal violence has been military intervention by the Nigerian Armed Forces, prompted by the unexpected access among Delta youths to small arms, most supplied from Uganda, overland via Sudan, Congo, Chad, Cameroon and the Central African Republic. The Nigerian army has deployed armored vehicles, helicopters, and naval gunboats to patrol the region around Warri city in Delta State.

The violence was sparked by a dispute over the rezoning of electoral wards in preparation for the coming presidential election. The uprising escalated when members of the Niger Delta communities took over oil production facilities. The Nigerian army was deployed to secure the oil facilities. This was followed by armed attacks by Ijaw youths directed at members of the Itsekiri and Urhobo communities, at the oil workers and at the Nigerian military. Members of the Ijaw community complained that only Itsekiri villagers have been evacuated from the trouble spots, while the Ijaw have not been offered the same protection. More than a dozen civilians have been killed in the fighting. Six soldiers have been killed and two have been injured.

Refugees fleeing Ijaw settlements claimed the Nigerian army had imposed a state of siege, with navy gunboats and soldiers blockading and firing on their villages. The navy has put a 24-hour ban on any movement in the affected areas. The soldiers may have set fire to some villages.

The Nigerian government has blamed the violence on youths from the Ijaw community, the largest community in the area. The Ijaw are concerned about their marginalisation by Nigeria government and the fact that they receive virtually none of the benefits from the oil wealth, which they say comes from their traditional lands in the region. The Ijaw community is demanding greater compensation and political representation from President Olusegun Obasanjo, who is facing re-election on 12th-19th April 2003. They also want the Independent National Electoral Commission (INEC) to redraw electoral boundaries before the April polls.

With the military is preparing to deploy more resources to bring the situation in Warri under control, other major oil producing communities have threatened fresh unrest. The Association of Major Oil Producing Communities [AMOPC] has issued a three-week ultimatum to the Nigerian Federal Government to address the neglect of their communities or face dire consequences. The communities have six major oil fields in their territory that generate a daily average of $20 million into the treasury of the republic of Nigeria, and yet the communities are without proper services and remain impoverished.

In a petition addressed to the president of Nigeria, Olusegun Obasanjo, and the Managing Director of the Niger Delta Development Commission, Mr. Godwin Omene, the group expressed dismay that after four years of democracy and about three years since the inauguration of the NDDC, their communities namely, Egbemo-Angalabiri, Peretorugbene and Ogbotobo, all in Ekeremor local council of Bayelsa State had remained epitomes of neglect, poverty and environmental devastation. The petition warned that the situation could have serious consequences for the oil firms operating in the area.

"It is quite disheartening that in spite of our enormous contributions to the nation's economy and the consequent health hazards associated with oil exploration and production, our communities are unduly denied their rightful place in the allocation of projects by the NDDC.

Leaders of the association warned that "the communities will be constrained to take steps that will make the area ungovernable for we shall no longer sit back and watch further gross marginalisation while we contribute the bulk of the nation's resources."