Nigerian militants have claimed responsibility for exploding a car bomb at an army barracks in the southern oil city of Port Harcourt.
Attacks by the militants has cut Nigeria's oil production by 25%
Two people died in the attack a day after the Movement for the Emancipation of the Niger Delta renewed its threat to target oil installations.
On Wednesday, Mend rejected plans announced by President Olusegun Obasanjo to develop the Niger Delta.
The militants are demanding more local control of the region's oil wealth.
In recent months there has been an upsurge of attacks on foreign oil interests which have cut the country's oil production by 20%.
This has cost Nigeria millions of dollars of lost revenue and helped to drive up world oil prices.
In a statement, Mend said the attack which killed two people and critically injured six more on Wednesday night "was symbolic rather than strategic".
The group said the attack was a warning to the Nigerian military and the oil companies in the area and proved that the Nigerian military was incapable of protecting itself, let alone protecting the oil industry.
"We suddenly heard one heavy bang and saw fire shoot up and everybody fled," nearby witness Tekena Lawson told AP news agency.
Military spokesman Maj Sagir Musa said explosives were placed in a Mercedes car parked inside the barracks and were detonated by remote control.
He said a number of civilians on the base were caught in the blast but he said no military personnel were hurt.
The BBC's Alex Last in Lagos says the use of a car bomb by militants is new.
Most previous militant attacks have been carried out among the creeks of the Niger Delta, not inside a major city like Port Harcourt.
It is also the first time Mend has claimed responsibility for an operation in the eastern Niger Delta. So far, their attacks have been confined to the west, our correspondent says.
Recently the militants announced it would stop taking hostages and use different tactics in its campaign to gain greater local control of the area's oil wealth.
Mend says the government's development plan announced this week was trying to remedy 50 years of injustice with the promise of menial jobs.
The oil militants rejected President Obasanjo's development plan
At the first meeting of a council set up to speed up development in the Niger Delta, President Obasanjo promised thousands more jobs and a $1.8bn (£1bn) motorway project for the oil-rich region.
Despite being home to Nigeria's oil industry for more than 50 years, there is acute poverty in the Delta.
Our reporter says the militants' grievances were not addressed at the meeting.
Although there have been promises of development in the past, few have become reality, he says.
In recent months, Mend have kidnapped foreign oil workers and warned them to leave the Delta.
Nigeria is the world's eighth largest oil exporter.