Energy Companies Turning To Private Security To Counter Rising Terrorism

Norwegian energy company Statoil has become the latest oil giant to turn to private security firms to handle its operations in North Africa, amid rising violence and organised attacks on its energy assets.

Norwegian energy company Statoil said in June it was forming a special operations division to handle emergency operations in response to a terrorist attack on a natural gas facility in Algeria.

Norwegian energy company Statoil has become the latest oil giant to turn to private security firms to handle its operations in North Africa, amid rising violence and organised attacks on its energy assets.

Norwegian energy company Statoil said in June it was forming a special operations division to handle emergency operations in response to a terrorist attack on a natural gas facility in Algeria.

The company said it would double the amount of employees it had designated for existing security operations after reviewing the measures in place at the In Amenas gas facility. A January attack there left employees with Statoil and BP dead in what al-Qaida said was a response to French intervention in Mali. With the economy just as much a viable target as any, counter-terrorism may becoming more than just the military’s game.

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A January attack by a division of al-Qaida in the Islamic Maghreb left several energy company employees and foreign fighters dead. The Algerian attack had the logistical support of Islamic fighters who travelled across the western border from Libya, still unsettled nearly two years after the revolution.

According to Reuters, Statoil was forming a special unit in response to the attack as part of a comprehensive response to the tragedy. Operations at In Amenas resumed at a limited capacity after the attack for owners Statoil, BP and Algeria’s state energy company Sonatrach. French supermajor said it too was spending more on industry-wide security operations since the January attack. Natural gas production has declined more or less since 2005 for Algeria and lingering instability in the region suggests a turnaround isn’t likely in the medium term.

BP said it had its own concerns, noting it was holding back on natural gas projects in the country because of the security situation there. Algerian Energy Minister Youcef Yousfi told a Houston energy conference in March the country “remains a stable country” despite the terrorist attack. He said the country wasn’t discouraged by the incident and remained committed to developing its natural gas sector. Algeria has enacted policies that would give foreign investors an incentive to take a closer look at unexplored fields in the country. Algeria in 2011 produced around 2.9 trillion cubic feet of gas and has since worked to return to its previous glory.

Statoil said it would appoint an official to lead security operations by July. The security team is part of what Statoil said was a “broader response” to the tragedy in Algeria.

British Foreign Secretary William Hague said the attack in Algeria shows that al-Qaida may be weakened, but it’s not yet out of the picture. He complained some members of the international community aren’t willing to take on the responsibility to tackle the threat themselves, however. With the international economy depending on a reliable source of energy to keep churning, Statoil’s actions suggest the energy sector may start to take on some of that burden itself.

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Daniel J. Graeber, Oilprice.com

Energy Companies Entering War on Terror is republished with permission from OilPrice.com.