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BLOOMBERG: Shell's Shares May Decline After Militant Attacks in Nigeria

Feb 20th, 2006
by admin.

Feb. 20 (Bloomberg) — Shares of Royal Dutch Shell Plc, the world's third-largest oil company, may drop after Nigerian militants reported new attacks against oil installations it operates in the country.
Militants blew up a Shell oil-pipeline manifold at Odidi in Delta state and an abandoned Nigerian army vessel during an attack at 2 a.m. local time, said the Movement for the Emancipation of the Niger Delta, or MEND. Shell has no immediate comment on the MEND statement, Caroline Wittgen, a company spokeswoman, said today by e-mail from London.
The company yesterday said its ventures in Nigeria have shut down all oil production in the western Niger River delta, halting 455,000 barrels of production a day and prompting increases in international oil prices.
“It's bad news for Shell because the Niger Delta is a significant part of their production,'' said Antoine Leurent, an analyst at KBC Securities in France, who may consider downgrading Shell shares from “outperform.'' “The situation is getting worse because the attacks look much more organized than before.''
The closures include the EA offshore field, which has a capacity of 115,000 barrels a day, and the Forcados export terminal. The shutdown affects about 20 percent of daily output in Nigeria, Africa's top oil producer.
Brent crude oil for April delivery today jumped as much as 2.2 percent to $61.23 a barrel in electronic trading on London's ICE Futures exchange. The contract traded a $61.10 at 7:20 a.m. London time. That's 31 percent higher than a year ago. The New York Mercantile Exchange, the world's largest energy market, is closed today.
To contact the reporters on this story:
Maher Chmaytelli in Cairo at [email protected];
Karl Maier in Khartoum at [email protected]

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