OBASANJO TALKS TOUGH ON OIL THEFT AND WARRI CRISIS

C O N F I D E N T I A L SECTION 01 OF 02 ABUJA 001333 SIPDIS E.O. 12958: DECL: 08/06/2013 TAGS: EPET PINS PGOV ASEC NI SUBJECT: OBASANJO TALKS TOUGH ON OIL THEFT AND WARRI CRISIS REF: A. ABUJA 1328 ¶B. ABUJA 1286 Classified by Charge d'Affaires, a.i. Dawn M. Liberi; reasons 1.5 (b) and (d). 1.(C) President Obasanjo summoned Charge Liberi and other diplomatic chiefs of mission to his office August 6 for a short briefing on the theft of oil in the Niger Delta. The extraordinarily short (25 minutes) meeting gave the diplomatic corps a warning of imminent security force action in the Delta, most probably concentrated in the Warri region. 2.(C) During the short briefing using power-points, the President highlighted the fact that the volume of crude oil lost to theft has hit levels not seen since 1999, the last year of military rule. As a result, Nigeria is losing over $3 billion a year, and is having difficulty meeting its OPEC oil production quota. This theft is carried out by organized groups who siphon crude oil from pipelines to coastal barges and ocean-going tankers. Nigeria cannot afford this hemorrhaging of national revenues, he declared. Noting that this illegal trade is protected by well armed militants, Obasanjo warned that Nigerian security forces may soon have to "disarm" them. 3.(C) The Charge asked the President if efforts were being made to prosecute the perpetrators of this large-scale, organized oil theft. After turning to his advisors, he responded that the government was indeed prosecuting offenders and that a "task force" was being established for this purpose. The Charge also asked about his prior day's meeting with a group of traditional leaders from the oil-producing South-South region, which he proclaimed a great success; "they agreed with me and will cooperate" in attempts to curb oil theft. 4.(C) Another diplomat queried the President on where the stolen crude oil was being sold, to which he replied "oil refineries in Cote d'Ivoire and Cameroon." 5.(C) According to Ijaw national leader Chief Edwin K. Clark, a group of South-South traditional rulers and youth leaders was summoned to the Presidential Villa August 5 for a meeting on oil theft and pipeline vandalization. In an August 6 meeting with CRO, Clark cited the President's quote of over USD three billion per year as the annual cost of oil stolen and claimed Obasanjo called upon the community leaders to assist the federal government in suppressing such crimes. 6.(C) According to Clark, the President's meeting started with the viewing of a "video" on bunkering activity, showing the barges, oil tankers, valves and hoses/pipes used to tap into Shell and Chevron's pipelines and flow stations. (Comment: This was probably the slide show of surveillance photographs taken and assembled by Shell and given to the President recently. End Comment) Clark commented that the photos showed that this activity is not orchestrated by simple youths in the oil swamps but rather by powerful and sophisticated "barons" capable of marshaling resources like ocean-going oil tankers. Nevertheless, the Ijaw chief conceded that "the boys" (his term for the Ijaw militants of the Federated Niger Delta Ijaw Communities--FNDIC) are a party to some of the oil theft. 7.(C) After the video presentation, Obasanjo discussed how the communities could play a helpful role in curbing the loss of oil. Clark and other ethnic leaders proposed community patrols to find and detain anyone attempting to tap into oil companies' pipelines or flow stations. According to Clark, the President and ethnic leaders assembled agreed to create community-level watch groups, headed by community chairmen and involving youth such as the Ijaw militants of Warri, provided that the Niger Delta Development Commission (NDDC) support these community patrols in cash and in kind. The Chairman of the NDDC, Onyema Ugochukwu, and his acting deputy, Timi Alaibe, were at the meeting and agreed to fund the community patrol initiative, said Clark. Warri Notes -------------- 8.(C) Turning to the recent upsurge in violence in the Warri riverine area, Clark downplayed the significance of the August 2 Itsekiri attacks on three Ijaw villages, claiming these were "small villages" and revealing that residents of the Ijaw village near the Warri Refinery had been involved in the theft of oil. Clark stated he had met with the Ijaw youth militants (FNDIC) immediately after the August 2 attacks and persuaded them to refrain from engaging in retaliatory strikes, absent additional Itsekiri provocations. 9.(C) In an August 6 meeting with ECONCONS and CRO, NDDC Acting Managing Director Timi Alaibe confirmed the plan to create local community patrol committees that the NDDC will compensate. He characterized this plan as one of three parts of the larger security strategy for the Niger Delta that President Obasanjo began unveiling at the August 5 meeting. The second element is the creation of a federal security task force, comprised of police, army, navy and the NDDC, which will attempt to restore peace and security in the Warri region first. The third element is an intensified effort to find a political solution to the Warri crisis. Alaibe acknowledged that the NDDC's role in supporting community patrol committees will call for significant new funds for the already strapped Commission, but he claimed that President Obasanjo has pledged to provide supplemental funding. Comment -------------- 10.(C) President Obasanjo appears to be confounding two separate security issues -- the theft of oil in the Delta and the rise of ethnic militancy. Although there is overlap, as the Ijaw militants are clearly involved in oil theft, the threats are distinct. Obasanjo may view it as expedient, however, to crack down on the militants of Warri under the guise of fighting oil bunkering crime. The initiative to create community-based patrol groups may be little more than fluff in light of the ominous warning of a security crackdown but, if serious, could be counter-productive. Such an attempt to use economic incentives to control belligerent youth involved in oil theft could easily be transformed into an extortion scheme by the militants, such as occurred to oil companies' well intentioned plans to improve security in the swamps through funding of community youth "home guards." LIBERI