NIGERIA: EXXONMOBIL WORRIES ABOUT ESCALATION OF

S E C R E T SECTION 01 OF 02 LAGOS 000369 NOFORN SIPDIS DOE FOR GPERSON, CHAYLOCK E.O. 12958: DECL: 09/18/2018 TAGS: EPET ENRG PGOV NI SUBJECT: NIGERIA: EXXONMOBIL WORRIES ABOUT ESCALATION OF VIOLENCE IN RIVERS STATE REF: A. LAGOS 317 ¶B. LAGOS 358 ¶C. LAGOS 365 ¶D. LAGOS 366 Classified By: Consul General Donna M. Blair for reasons 1.4 (B) and (D ) ¶1. (S/NF) Summary: On September 18, two ExxonMobil Nigeria executives told Energyoff that while September 13-16 attacks in Rivers State did not reduce oil production from their fields, they are concerned about growing instability in the state and the impact it might have on facilities which serve their offshore oil platforms. They reported that militant leaders Tom Polo from Delta State, Ateke Tom from Rivers State, and an unnamed militant leader from Bayelsa State met in Akwa Ibom on September 18 to discuss greater cooperation, while on the same day Joint Task Force (JTF) intelligence and operations officers met to discuss their own next steps. With the recent turnover of Bakassi, the Exxon executives are also worried that internally displaced persons from the Bakassi region may turn to militant activity. They also shared a satellite graphic with Energyoff that showed the locations of recent militant attacks and three new militant camps that have been established in Akwa Ibom state. End Summary. ¶2. (S/NF) Mark Ward, ExxonMobil's Executive Director for Exploration and Production and Paul Viana, the company's Risk Management Advisor, (strictly protect both) told Energyoff that ExxonMobil's oil production was not impacted by the 13-16 September militant attacks in Rivers State. (Ref C) (Note: ExxonMobil's fields generally lie offshore of Akwa Ibom. The company's large Erha deep offshore production facility sits much further west, 60 miles offshore of Delta State. End note.) However, they said the growing level of instability in Rivers State could endanger the logistics support most oil companies receive from the Onne deepwater support base on Bonny River near Port Harcourt. Much of ExxonMobil's logistics support is run out of Onne base and Exxon's own logistics facilities in Port Harcourt. Ward worried that an attack on Onne or an attack on the three to four Nigerian Navy boats that escort the logistics convoys on Bonny River would cripple the industry, including oil production located outside of Rivers State. Ward and Viana classified the Nigerian Liquefied Natural Gas (NLNG) plant and Bonny Export terminal, both of which sit on the mouth of the Bonny River, as particularly vulnerable to attack. They thought a successful attack on either one could "block" the mouth of the Bonny River and cause oilfield service companies to pull out of Nigeria completely. ¶3. (S/NF) Ward told Energyoff that Exxon's sources in the Niger Delta report that Tom Polo from Delta State, Ateke Tom from Rivers State, and an unnamed Bayelsa militant leader met on September 18 in Akwa Ibom State to discuss areas for cooperation. Both Ward and Viana said the motivation was economic; recent JTF success in stopping illegal oil bunkering was having an impact and militant leaders saw a need to do something about it. Ward also said JTF operations and intelligence officers were meeting that same day to discuss their next moves. Ward and Viana worried about an escalation of the violence. ¶4. (S/NF) The executives shared a color printout of a Google Earth satellite graphic overlaid with the locations and dates of recent militant and JTF attacks and the locations of what they said were three new militant camps in Akwa Ibom State. Two of the camps were located on the coast 45 and 65 kilometers respectively to the west of the Qua Iboe export terminal tank farm. The third camp was located in Akwa Ibom on the western bank of the Cross River across from the Bakassi Peninsula. Ward and Viana were particularly concerned about the third camp, which they believed may house refugees from Bakassi (and is nearer to their near offshore oil platforms). They also said internally displaced Nigerian LAGOS 00000369 002 OF 002 refugees remaining in Bakassi, which they estimated at around 100-150,000, could be a source of new militant fighters. (Refs A,B) ¶5. (S/NF) Both executives thought the militants could effectively take Nigerian oil output "to zero" if they made a concerted effort to attack Nigeria's onshore pipeline system. But both were more circumspect when asked about the possibility of that happening. They believed that the recent violence and the militancy in general was ultimately about control of the illegal oil bunkering, and the militant leaders and their backers understood they couldn't completely take out the oil industry because then there would be nothing left to steal. ¶6. (S/NF) Comment: ExxonMobil appears more concerned about the recent events in Rivers State then they have about previous incidents. They fear it is a serious problem that could disrupt their logistics operations and spread into Akwa Ibom State. They have previously noted their inability to establish an alternate supply base outside of the Niger Delta. A facility in Lagos, long in the works, has been delayed by political wrangling. The allegation that Tom Polo was involved in the September 18 meeting contradicts information we received from a Chevron executive who told us on September 17 he did not believe Delta State militants were cooperating with militants in Rivers State. (Ref D). End Comment. BLAIR