Royal Dutch Shell PLC warned Friday that oil-facility attacks in Nigeria this past week have substantially reduced its oil and natural-gas production in the West African country and will hurt earnings.

Shell said militants this past week had killed a second person, an employee of the Shell-operated consortium in Nigeria. The company said earlier in the week that a guard had been killed and reiterated Friday that it was evacuating some staff from production facilities.

The Anglo-Dutch oil company said it was concerned about the damage to the facilities but didn’t provide an estimate on the total amount of oil and natural-gas output shut down as a result, or how long the production closures might last. Nigerian oil officials put Shell’s production losses this past week at about 100,000 barrels a day.

The company said the damage will hurt earnings. “This will ultimately add up to increased equipment downtime, repair and remediation costs and deferred earnings for Nigeria and the joint-venture partners,” Shell said.

Clashes between Nigeria’s main militant group — the Movement for the Emancipation of the Niger Delta — and the military helped precipitate the latest attacks on oil infrastructure, coming less than a month after Nigerian President Umaru Yar’Adua shuffled his military leaders.

Some political analysts say Mr. Yar’Adua may be taking a more forceful approach to MEND, which comprises various factions, and other criminal groups that have had a free hand the past few years, bombing pipelines and crude-gathering stations and kidnapping foreign oil workers for ransom.

A tougher line could worsen tensions and problems for the government, foreign energy companies and the region’s people.

So Nigeria is Shell’s only source of oil?  NOT!  Stop!  They are lying so they can either keep their profits or to make stock more appealing when it comes in over expectation.