From Niger Delta, with rage

Over 959 attacks within a spate of six months, there is no mistaking the intent of the Niger Delta Avengers is to drive a knife through the heart of Nigeria’s economy. Crude oil output in Africa’s oil rich tottering largest economy has slumped to 1.1 million barrels per day at a time oil prices have rallied to $50 and the environmental impact of frequent attacks on oil infrastructure will haunt generations unborn, writes ISAAC ANYAOGU.

Renewed hostilities in the Niger Delta are threatening to sink the Nigerian economy, even as those who manage it have been accused of fiddling while Rome burns.

Between January and March 2016, a total of 959 vandalised points have been recorded on oil and gas infrastructure in the Niger Delta, the research team at CardinalStone Research stated. Militant attacks on oil and gas infrastructure is not new. The danger this time, is that they seem to be doing it for the pleasure.

Major attacks recorded this year include- disruptions on Agip facility at Orukari, Golubokiri and Kpongbokri communities of Brass Local government in Bayelsa with 142,000 barrels per day and the attack on Shell Petroleum Development Company of Nigeria subsea crude exports pipeline that led to a loss of 300,000 b/d.

The International Oil Companies (IOCs) are declaring force majeure – a legal clause that allows the exporters to stop shipments without breaching contracts.  This has led to shut-ins of four of Nigeria’s five largest export streams: Forcados, Qua Iboe, Bonny Light and Brass River with only Qua Iboe as a result of technical problems.

Niger Delta Avengers

When it started, it seemed like a rude joke until it morphed into the stuff of nightmares because Nigerians, it seemed, have perfected the act of ignoring small fires.

The Niger Delta Avengers, a militant group, rose on the ashes of government’s efforts to scale back amnesty deal struck in 2009, estimated to have cost Nigeria $500m a year since then, according to a report published by Edinburg International. The group started to blow up oil and gas infrastructure before they even think up a coherent reason for their campaign of terror.

“Due to the recent happenings in the country, the Niger Delta Avengers have taken it upon themselves to start a war against all oil and gas companies in the region,” the team said on February 10.” It added later, “In the next few hours, the high command of the Niger Delta Avengers and his allies will sit and come out with a communiqué to clearly state the reasons why oil and gas pipelines are being attacked in the Niger Delta region.”

The group has demanded more equitable distribution of income generated by oil and gas production, redistribution of oil and gas assets and action on environmental pollution in the delta region.

While militancy is not new, the modus operandi of this group suggests they should be taken seriously. They have created a website and social media pages to spew propaganda, suggesting an awareness and deployment of communication strategy. Their attacks have increasingly become sophisticated. In February, they bombed Shell’s underwater infrastructure   indicating, a level of sophistry not employed by past militants. They have also managed to attack strategic network of pipelines crippling Nigeria’s four power plants.

“We don’t see this being a huge group, but at the same time, they do seem very effective,” said Matthew Bey, energy and technology analyst at geopolitical research firm Stratfor.

Ibe Kachikwu, junior minister for petroleum resources said Nigeria’s oil production has fallen by 800,000 barrels per day — to 1.4 million barrels per day due to attacks on the nation’s infrastructure last month.

However, revelations by an official of the Nigerian National Petroleum Corporation to an international media organisation indicate that the extent of loss is over 1 million barrels per day.

Bruising effects on the economy

Nigeria’s economy slowed the weakest in a decade last month by 0.36% during the first quarter of 2016 from a comparative increase of 2.11% during the same period last year, according to the National Bureau of Statistics.

Oil prices have slumped by almost 70 percent of 2015 figures and national reserves have depleted to a paltry $25billion as governments tried to install foreign exchange controls and artificially prop up the reeling naira.

Federal allocation to the three tiers of government fell in April to N281.5 billion, down 18.25 billion from March due to low oil prices, according to Kemi Adeosun, Finance minister. Now 27 states out Nigeria’s 36 cannot even pay civil servants.

“People are finding it difficult to pay their suppliers, financial houses are finding it difficult to remit funds, these are evidences of a foreign exchange market that is not liquid,” laments Muda Yusuff, director general of the Lagos Chamber of Commerce.

The Federal Government bowed to pressure in May and allowed a flexible exchange rate policy for the beleaguered economy.

Options to tackle the menace

Analysts are divided over the best way to confront militancy but not the Army commander.

“The recent spate of attacks by militants disrupting oil and power installations will not distract us from engaging leaders in the region, in addressing Niger Delta problems. If the militants and vandals are testing our resolve, they are much mistaken. We shall apprehend the perpetrators and their sponsors, and bring them to justice,” said President Muhammadu Buhari on his Democracy day address to Nigerians, indicating dialogue will be employed, while force as an option remains on the table.

On May 30, soldiers of 343 Artillery Regiment of 2nd Brigade, 82 Division of the Nigerian Army reportedly engaged the militants in a fierce gun battle at Gulobokri and Eweleso communities in Bayelsa.

Wunmi Iledare, professor of Petroleum Economics and Policy Research and the Director of Energy Information Division of the Centre for Energy Studies, believes that while dialogue is a good option, the country cannot afford to tolerate criminality.

“Government cannot fold their hands and allow lawlessness to prevail. Of course, peaceful resolution is always the best. You don’t want to declare war against your own people. The essence of democracy is that we need to be able to negotiate our differences but if it borders on criminality, you cannot negotiate with a criminal. The moment you negotiate with criminals, you are literally rendering your country ungovernable,” he said.

Henry Biose, Petroleum Economics, Management and Policy researcher at Emerald Energy Institute for Petroleum and Energy Economics, University of Port Harcourt, believes that best approach is to restructure the amnesty programme, so as to treat causes rather than address symptoms.

“The government should revisit the Amnesty programme in the Niger Delta as a matter of urgency and directly carry out an immediate assessment of the level of implementation of the various programmes. This would help the government understand the root cause and set the right programme or infrastructure that would engage the community people in a productive activity or process.”

Meanwhile, Bismark Rewane, CEO of Financial Derivatives has stated that upsurge in militancy culminating with intense war of corruption may not entirely be a coincidence.

Whatever option is employed, it is an indisputable fact that only caution is required to deal with a fly perching on your scrotum.

ISAAC ANYAOGU