3rd UPDATE: Eni Shuts Down Output After Nigeria Line Sabotage

Italian energy company Eni SpA (E) said Friday an oil pipeline in Nigeria that feeds the Brass terminal was sabotaged and production has been shut down, in the latest of a string of attacks against oil companies in the hydrocarbon-rich African country.

In a statement, Eni, Italy's largest energy company by market value, said the total amount of production loss is currently about 33,000 barrels of oil a day, of which 6,000 barrels are Eni's share, and about 2 million cubic meters of natural gas, of which 437,000 are Eni's. The sabotage took place between Thursday and Friday and production was immediately shut off, the Rome-based company said. Output is currently still down. No timetable for when it would restart has been given. Earlier Friday, the main militant group in Nigeria's Niger Delta, the Movement for the Emancipation of the Niger Delta, said it blew up the pipeline.

Militants have escalated attacks on the oil industry in retaliation for an army offensive that started mid-May.

In an email, MEND said "a major pipeline which delivers crude oil to the Brass export terminal was blown up at the Nembe creek in Bayelsa state this morning Friday" by its members.

It said the pipeline belongs to Agip, a unit of Eni. The Brass facility has a capacity of around 160,000 barrels a day.

Last month, Eni declared force majeure - a legal protection clause for not meeting contractual obligations to customers - on 52,000 barrels a day of crude from the Brass terminal.

The company said the force majeure, which was lifted after a week, was due to pipeline damage, without specifying if it was sabotage.

Chevron Corp. (CVX) and Royal Dutch Shell PLC (RDSB.LN) have also been attacked by the militants. One attack alone in May cost Chevron 100,000 barrels a day in lost production.

In total, Nigeria estimates 1 million barrels a day of its output is down due to unrest but also to oil theft and lack of maintenance.

-Benoit Faucon and Liam Moloney, Dow Jones Newswires; +44 20 7842 9266; benoit.faucon@dowjones.com

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