Witnesses said suspected militia fighters ordered people away from the facility before dynamiting the pipeline about 30 miles southwest of the southern oil center of Port Harcourt. Gabriel Ogbologwung, a journalist who visited the scene, said eight charred bodies had been pulled from a fire sparked by the blast.
Shell Spokesman Andy Corrigan confirmed the blast, but had no information on what set it off or whether it caused injuries.
Corrigan said by telephone from London that the explosion had pared some 170,000 barrels per day of Shell's regular 1 million barrel daily oil production in Nigeria, Africa's largest petroleum producer and world's eighth-largest oil exporter.
There was no word on when full production would be restored. Nigeria normally has daily total output of about 2.5 million barrels.
Despite the valuable crude pumped from Nigeria's south, the region remains one of the country's poorest and is frequently the site of violence as rival groups compete for power -- which means access to oil revenues.
Saboteurs have in the past blown up oil pipelines. Deadly conflagrations have engulfed Nigerians collecting oil gushing from pipelines pierced by criminals hoping to steal the crude and sell it on the black market.