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Shell Declares Force Majeure after Nigeria Attack

Royal Dutch Shell declared force majeure on Tuesday on its Nigerian Bonny Light crude oil exports for July to September following an attack by militants on an oil trunk pipeline in the Niger Delta on Monday.

SPDC, the joint venture under which Shell operates onshore and shallow water oilfields with Nigerian state-run oil firm NNPC, said earlier a helicopter inspection had confirmed that parts of its Nembe Creek trunk line were damaged in the attack.

"Effective midnight today SPDC has declared a force majeure on the July, August and September 2008 offtake program from the Bonny Light stream," Caroline Wittgen, spokeswoman for Shell in Nigeria, said.

"SPDC is working hard to repair the line and restore production," she said.

The Movement for the Emancipation of the Niger Delta (MEND) said it had blown up pipelines at Kula -- through which the Nembe Creek trunkline passes -- and at Rumuekpe, located around 50 km (30 miles) west of the main oil city of Port Harcourt.

Rumuekpe is not part of the Nembe Creek trunk line.

Shell said it was continuing to assess the damage to its facilities.

Industry sources said about 130,000 barrels per day of crude oil flows through the Nembe Creek pipeline to the Bonny export terminal.

The oil from the facility is particularly popular in the United States and Europe because it is easily refined into gasoline, diesel and other crude products.

MEND's campaign of violent sabotage against the oil industry in the Niger Delta has cut output in the world's eighth biggest exporter by around a fifth since early 2006.

The latest attacks came just as traders expected Nigeria's crude exports to rise to 2.02 million barrels per day in September, following pipeline repairs.

Traders said on Monday the preliminary September programs showed an increase from estimated exports of 1.94 million bpd in August but warned that further attacks could disrupt supplies.

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