Nigeria's oil hostages set free

Oil militants are often paid to release hostages

All 60 Nigerian hostages seized earlier this week in the main oil-producing region have been set free.

Young armed men stormed a flow station run by oil giant Shell on Tuesday. Police said the youths had staged the attack because of a dispute with Shell.

There has been an increase in attacks by oil militants this month.

President Olusegun Obasanjo is in the Niger Delta to open development projects - locals say they do not benefit from the area's oil wealth.

The release of the last hostages comes after two days of negotiation by the local authorities.

By the official opening of the projects, the restiveness and violence in the region will reduce Emmanuel Okah Rivers State spokesman

The community believed that Shell had failed to honour its promise of providing education, clean water and bags of rice.

Seven foreign oil workers are still being held hostage after being seized last week.

Basic services

The BBC's Alex Last in Lagos says the incident illustrates that in the Delta small disputes can turn violent given people's poverty, the proliferation of weapons and their deep-seated anger at the oil industry.

Our reporter says it also highlights the fact that the government, despite its huge oil revenues, has failed to provide basic services, so communities see the oil companies as an alternative source of funding.

Many communities feel that the best way to get swift compensation is to get an armed group to attack an oil installation, he says.

The government has pledged to address the lack of development, which is one of the underlying causes of violence in the Delta.

President Obasanjo, who is visiting the city of Port Harcourt, has promised several billion dollars in development projects and job creation schemes.

He is to open a university teaching hospital in the city, a recently privatised petrochemical facility and a floating petrol station to serve a remote area.

"The president is committed to jump-start development in the region," Rivers State spokesman Emmanuel Okah told the AFP news agency.

"By the official opening of the projects, the restiveness and violence in the region will reduce."

But our reporter says for the moment there is still scepticism in the Delta that such projects will make much difference for the communities in need.

Last month, President Obasanjo promised strong action to curb armed groups in the Niger Delta.