- The Washington Times - Thursday, February 12, 2009

Nigeria’s unions of oil and gas workers are threatening to stop work amid growing attacks and kidnappings by militants and criminal gangs, which have cut daily production by nearly a quarter in the past three years.

Unions also cited the recent award of an inspection contract to an outside firm in a brief work stoppage Wednesday.

The region’s main militant group, the Movement for the Emancipation of the Niger Delta (MEND), is behind most of the attacks, asserting it wants the federal government to spend more of its oil revenue to develop the impoverished south.

On Friday, the group freed Gladys Daukoru, the wife of former oil minister Edmond Daukoru, the military said.

MEND said in a statement the following day that the former minister had paid a ransom of $2.5 million in cash.

Mr. Daukoru did not comment, but security officials told Agence France-Presse that a ransom worth about $67,600 had been paid for his wife’s release. The government denies that it pays ransom.

On Thursday, gunmen freed Olumide Awolesun, the 9-year-old son of an oil worker they had held hostage, from a kidnapping in which they fatally shot his 11-year-old sister.

These were among the latest in a series of kidnappings in the oil rich Niger Delta region, crimes that the government blames on criminal gangs.

The National Union of Petroleum and Natural Gas Workers, or NUPENG, said it was “high time the federal government steps in fully to address the problems of securing the lives and properties of its people.”

“The union condemns in its entirety the killing of the [girl] for resisting the kidnapping of her brother and describes the act as barbaric, uncivilized, criminal and unheard of in the history of kidnapping in the Niger Delta.”

MEND and others contend they see little benefit from production of oil and gas in the region, either from the national government or the oil companies.

And while poverty continues and increases, the residents suffer from environmental pollution typical of such an industry in a developing country. Not all violence is political, as many kidnappings are merely for ransom money.

But MEND, especially, has spearheaded an effort to hit the industry itself and affect company and government accounts.

Meanwhile, Nigerian oil workers waged a brief strike Wednesday to protest the appointment of a foreign-based company to perform inspections at oil facilities.

The workers in Nigeria’s Department of Petroleum Resources, or DPR, called off a strike shortly after it began, Bloomberg news service reported.

Wednesday´s strike was separate from another security-related walkout in the region, Bloomberg said.

Union officials say that Nigeria’s new petroleum minister, Rilwanu Lukman, has a financial interest in the company hired to do inspections, Cobalt International Services, and was directly profiting from its use.

A statement by the union representing the DPR said that the government’s hiring of Cobalt was a duplication of functions performed by DPR monitors, the energy analysis firm Platts reported.

“When many countries were jealously guarding their economies as a result of the global economic meltdown, it is unfortunate that our government is busy contracting foreign firms in a strategic sector like the oil sector that is the life wire of Nigeria’s economy,” the statement read.

According to the leading Nigerian newspaper, Punch, Mr. Lukman’s office did not comment on the allegations.

Leaders of Nigeria’s largest oil union, the Petroleum and Gas Senior Staff Association of Nigeria, PENGASSAN, said they did not see the value in hiring an outside firm to monitor its oil exports at a cost of more than $87,000 a day, Punch reported.

“We don’t see any reason why somebody will bring an international oil company and duplicate a function and take our crude. We should not allow it,” said Mohammed Bulama Saidu, a PENGASSAN leader.

The oil union’s threat was just the latest in a series of labor battles in the country’s petroleum sector.

Last year, U.S. oil giant ExxonMobil incurred the losses of millions of dollars and 800,000 barrels of production per day during a prolonged strike.

PENGASSAN’s grievance with ExxonMobil began in March 2008, when the union threatened to walk off the job to protest a decision to fire 100 union workers.

ExxonMobil officials said the employees were given generous compensation packages during a restructuring.

Grievances with oil companies operating in the delta region are not uncommon, said Rolake Akinola, a senior analyst for West Africa at the London-based consulting firm Control Risks.

“These kind of strike threats are a sort of a trend [in the Niger Delta],” Mr. Akinola told United Press International. “That’s the cycle we’ve seen in the oil industry.”

Mr. Akinola said lost production from strikes remained insignificant compared with lost production from the violence.

Producing just more than 2 million barrels a day, Nigeria’s oil sector has seen production fall more than 20 percent from the violence.

• UPI energy editor Ben Lando contributed to this report.

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