Nigerian Peace Remains Elusive After Oil Region Truce

By Dulue Mbachu

July 16 (Bloomberg) -- Nigeria’s release of rebel leader Henry Okah and his movement’s announcement of a 60-day cease-fire may not be enough to end the insurgency that has cut crude supply from Africa’s top oil exporter by a fifth.

President Umaru Yar’Adua’s administration dropped charges of treason and gun-running against Okah, 44, releasing him on July 13 from more than a year in jail, as part of an amnesty for rebels announced last month.

The Movement for the Emancipation of the Niger Delta, or MEND, responded by calling a temporary cease-fire and saying it will seek talks with the government. Okah himself isn’t sure he’ll be able to stop the violence.

“I’ll have to go into the creeks and meet the commanders,” Okah said in a telephone interview from the Nigerian capital, Abuja, yesterday. “I’ve been away for 23 months and it’s only after I have had time to talk to those involved that I can say anything.”

Armed attacks targeting oil infrastructure in the southern Niger River delta, home to Nigeria’s oil industry, have shut plants operated by Royal Dutch Shell Plc, Chevron Corp. and Eni SpA, curbing production of the light, sweet variety of oil favored by U.S. refiners. Lost oil exports from Nigeria, the fifth-biggest source of U.S. oil imports, has contributed to crude’s 37 percent rally this year to more than $61 a barrel.

Respite in Fighting

The truce, if it holds, may provide an opportunity for Yar’Adua to start to address grievances in the delta region, particularly the widespread demand for more local control of oil, said Antony Goldman, a London-based analyst specializing in West African countries.

“The most you can get is a respite,” Nnamdi Obasi, West Africa analyst for the Brussels-based International Crisis Group, said yesterday by phone from Abuja. “Then after a while both sides will go back to the trenches.”

Demands for distributing more wealth locally have proved difficult for the authorities in Abuja to accept, since Nigeria’s government depends on oil exports for more than 80 percent of its revenue and 95 percent of foreign income, according to the Petroleum Ministry.

MEND is calling for a system of “fiscal federalism,” in which states in the delta region should receive 100 percent of the earnings from the oil industry and then pay a tax to the federal government.

Revenue Sharing

A panel appointed by the government last September, known as the Niger Delta Technical Committee, recommended changing the current revenue-sharing system so that the share of states in the Niger delta would rise to 25 percent, from 13 percent now.

“It’s now eight months since the government received that report and it’s doubtful it wants to address that issue,” said Obasi of Crisis Group. “Addressing it and dealing with issues of mass poverty and infrastructure needs in the region is the only way there can be lasting peace.”

Communities in the Niger Delta, a maze of creeks and rivers feeding into one of the world’s biggest remaining areas of mangroves, are among Nigeria’s poorest, a Shell-funded report on the area said in 2004. It cited studies showing per-capita income in the region to be below the national average of $260 a year. Unemployment exceeds 90 percent in some areas. Nigerian oil production averaged 1.79 million barrels a day in June, according to Bloomberg estimates.

Fragile Truce

The truce remains fragile. Only hours after declaring it, MEND said the Nigerian military had dispatched troops to one of its camps. If attacked, MEND said it would call off the cease- fire. Colonel Rabe Abubakar, a spokesman for the government’s Joint Task Force in charge of security, denied any such raid was planned.

The day before Okah’s release, the most significant gesture of the government’s amnesty program so far, the rebel group brought its campaign from the delta to Lagos, Nigeria’s biggest city, in an attack on Atlas Cove, the main fuel receiving jetty.

“Okah’s release happening propitiously” just after “MEND extended its attacks to Lagos does not bode well for the government’s amnesty plan,” said Sebastian Spio-Garbrah, West Africa analyst for Eurasia Group.

Command Structure

Armed groups in the delta have “no single unifying leader or command structure,” he said, so individual commanders may accept the government’s amnesty while others pursue attacks.

Since violence in the region intensified in May, when the government launched an offensive against MEND bases, both sides have seen that militarily neither can deliver a knock-out blow, Goldman said. While the government may have surprised the militants with the capacity it displayed, it also showed that it can’t defend all oil facilities, he said.

Nigeria’s Inspector-General of Police, Mike Okiro, yesterday urged militants to accept the amnesty, saying the Okah’s release was evidence of the government’s commitment to the process.

“Government is not going to force you to respond to the amnesty,” Okiro told reporters in Port Harcourt. “Government has given a period of time for the amnesty and if the amnesty period expires, it means, you do not want it.”

The government portrays the amnesty as the first step in a process to bring peace to the region.

It’s not intended as “a stand-alone solution,” Tamie Koripamo-Agarry, a spokeswoman for the Presidential Amnesty Committee, said in a statement e-mailed to reporters yesterday.

The government recognizes the neglect in the region and is prepared to help boost development, she said. “Peace will accelerate this process.”

To contact the reporter on this story: Dulue Mbachu in Lagos at dmbachu@bloomberg.net