June 22, 2009

N-Delta crisis: Senate to survey oil companies operations

By Emmanuel Aziken

ABUJA — The Senate is to conduct a survey of oil producing companies towards determining the effect of the ongoing military operations in the Niger Delta on their production activities.

Senator Lee Maeba, chairman of the Senate committee on Upstream Petroleum yesterday acknowledged that the operations of the Joint Task Force (JTF) would have affected the production levels of the oil companies. He, however, said  only a comprehensive survey could determine the real impact of the operations on oil operations.

Oil revenue derived from the Niger Delta forms the main substance of Federal overnment revenue. Under the 2009 Appropriation Act, production level is expected to average 2.29 million barrels per day.

However, the activities of militants in the Niger Delta region and the counter operations of the JTF has led to a shutdown of an estimated half of the expected daily production.

Among the oil companies worse hit by the military operations were Chevron operating from Delta State, Agip and lately Shell which suffered a major casualty at the weekend.

Maeba (PDP, Rivers Southeast) said the survey to be carried out by the Senate committee would be done in conjunction with the Nigerian National Petroleum Corporation (NNPC).

He expressed concern that the shut-ins by the oil companies could negatively affect the performance of the 2009 budget.

“When we resume we plan to conduct a survey on the companies to know the effect of the security operations on their own production,’’ he said.

“We want to find out how the operation is hurting them, especially those onshore.

“We will discuss with the companies so that we will know their losses, the cost of rehabilitation and in fact the cost of shutdown,’’ he added.