From: Tsegai Emmanuel (emmanuelt40@gmail.com)
Date: Wed May 19 2010 - 19:06:49 EDT
Published on Wednesday, May 19, 2010 by Reuters
Africa's Oil Spills Are Far From U.S. Media Glare
by Joe Brock
LONDON - Oil gushing from an undersea well in the Gulf of Mexico has damaged
BP's reputation and share price but accidents involving other companies in
less scrutinized parts of the world have avoided the media glare.
In this Dec. 22, 2005 file photo, people evacuate their homes by boat, as
they pass smoke and flames billowing from a burning oil pipeline belonging
to the Shell Petroleum Development Company, across the Opobo Channel in
Asagba Okwan Asarama, some 50 kilometers (31 miles) southwest of Port
Harcourt, Nigeria. (AP Photo/George Osodi, File)
Investors have knocked around $30 billion off BP's value since an explosion
at a drilling rig killed 11 people and began an oil spill the London-based
major is struggling to plug nearly a month after the accident happened.
The U.S. media and political machine has turned its full force on BP and
U.S. President Barack Obama has set up a commission into the leak which is
sending an estimated 5,000 barrels per day (bpd) into Gulf of Mexico waters.
In contrast, the international media has largely ignored the latest
incidents of pipeline damage in Nigeria, where the public can only guess how
much oil might have been leaked.
The most recent damage in Nigeria, which has not been attributed to militant
attacks that have preyed on Nigerian oil infrastructure for years, forced
U.S. operator ExxonMobil to relieve itself of contractual obligations by
declaring force majeure on its exports of Nigerian benchmark crude.
The light sweet crude is particularly well-suited for refining into gasoline
and is regularly supplied to the United States, the world's biggest oil
burner.
Exxon declined the opportunity to give details of the damage, clean-up or
repair work.
An industry source, who declined to be named, said 100,000 bpd of oil had
leaked for a week from a pipeline that has since been mended.
"If this (the BP spill) were in the Niger Delta, no one would be batting an
eyelid," said Holly Pattenden, African oil analyst at consultants Business
Monitor International. "They have these kind of oil spills in Nigeria all
the time."
SHARE PRICE IMPACT
BP's share price has fallen around 18 percent since news of the fire at the
drilling station on April 20, while Exxon shares were largely unchanged
after the force majeure announcement.
The largest operator in Nigeria, Royal Dutch Shell has clashed with the
Nigerian government for decades following numerous spills in Africa's
largest energy producer.
Shell said in a statement on its website that its Nigerian joint venture
cleans up oil spills as quickly as possible, no matter what their cause, but
is sometimes delayed by security concerns or because some communities deny
access.
The Anglo-Dutch major said the volume of oil spills in Nigeria for its joint
venture was almost 14,000 tonnes last year, the equivalent of around 280
bpd, mainly because of militant attacks on facilities.
"It (the U.S.) is without doubt the worse place for BP to lose their
political capital," said James Marriott, oil and gas analyst at
environmental organization Platform.
"If the U.S. administration gets aggressive against BP, then it's a problem
for them offshore, onshore in terms of shale gas, for conventional gas,
refining, some cross-border projects with Canada and further afield."
In the United States, BP's massive spill and the risk of an environmental
catastrophe could have implications throughout the industry as it has
reopened the debate about deepwater drilling.
Analysts say, however, the world is hugely dependent on deepwater drilling
to secure oil supplies.
The ExxonMobil force majeure relates to shallow offshore oil, but much of
West Africa's crude production, like that in the U.S. Gulf of Mexico, is
deepwater.
Analysts say it is unrealistic to veto deepwater drilling if the world's oil
needs are to be met.
"Perhaps in terms of health and safety regulation (things will change), but
not in terms of drilling," said Angus McPhail of Wood Mackenzie consultants.
"It is not really feasible to stop drilling altogether as long as there is
good demand for the product.... It would be total economic madness."
*(Additional reporting by Barbara Lewis in London and Randy Fabi in Abuja;
editing by Anthony Barker)*
© 2010 Reuters
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