Industry sources put the estimated output of the flowstations, feeding into the Forcados export terminal, at about 150,000 barrels of crude per day, or about one-fifth of Shell's recent output from Nigeria. "It is very good news for us," a Shell spokesman said.
The possibility of reopening the flowstations in the troubled region near the coastal city of Warri comes after months of growing instability on the oil-producing coast of Nigeria which has plagued Shell's production. "Obviously it is not a matter of bringing things back on overnight ... [but] we will move as quickly as we can," said one Shell official in Warri.
Agreement to reopen the flowstations follows lengthy talks brokered between rival ethnic groups by the Governor of Delta State, James Ibori, after scores of people died in fighting near Warri days after the end of military rule in May.
Local officials said it had been agreed in principle that a local government headquarters in Warri would be relocated to an Ijaw area from an Itsekiri district. The siting of the local government headquarters is important because it is a source of money and jobs for locals. But clashes that erupted over the relocation in 1997 by the late dictator Sani Abacha were a catalyst for wider trouble in the Niger Delta, where dominant ethnic Ijaws say they have been marginalised by oil firms and the state. It is not yet clear how the Itsekiris will react to the relocation of the government headquarters.
The Forcados Terminal has been producing barely 300,000 barrels per day compared to capacity of more than 450,000 bpd and the roughly 400,000 bpd it would be producing in line with Opec cuts to boost world prices.Reuse content