(Adds treason trial, paragraph 16)

By Tom Ashby

LAGOS, June 12 (Reuters) - Nigeria's new government is moving quickly to bring its oil-producing delta region back from the brink of anarchy, but persistent violence in Africa's top oil producer is still driving investors away.

President Umaru Yar'Adua's efforts to build confidence among militant leaders are already showing results and two armed groups have freed a total of 19 hostages since his inauguration two weeks ago.

But activists say he will have to follow encouraging noises with swift action to build trust in the impoverished wetlands region of southern Nigeria, where many people feel cheated out of their resource wealth by successive governments.

"Things are moving fast and well," said Oronto Douglas, a delta activist who is mediating some of the talks.

"We have to seize the moment and get things back onto the track of peace and that is what is going on, but it is going to be hard work."

Militant attacks on oil facilities and frequent kidnappings of foreign workers have cut production by 750,000 barrels a day, or a quarter of the country's total capacity, fuelling concerns in global oil markets over supply security.

Thousands of foreign workers have left the delta and the local economy has suffered.

Some groups have made political demands, including more autonomy for the delta and the release of two jailed leaders, but much of the violence has been by criminals seeking ransoms.

Yar'Adua has said he will address the underlying grievances before imposing a security crackdown.

"My plan is for a massive intervention and, after consulting with all the stakeholders, we will take our plan to the National Assembly so everyone can buy in," the president said in a statement on Monday night.

"Once we can address the development issues, it would be easy to tackle the criminal element of the problem," he added.

CLOSED-DOOR MEETINGS

Vice President Goodluck Jonathan, who was chosen for the job partly because he originates from the delta, has begun a series of closed-door meetings with militants and activists to get a peace process going.

Demands range from increasing revenues to oil-producing areas to massive human and physical infrastructure development.

One big issue which has yet to be addressed is corruption by state governors in the region, who are suspected of siphoning off billions of dollars meant for development.

While amendments to the country's legal framework could take months or years, activists say Yar'Adua will probably start by making infrastructure investments, creating jobs and offering training to the masses of unemployed youths.

The new president could make a big opening bet on Wednesday, when delta rebel Mujahid Dokubo-Asari's treason trial resumes in Abuja. There has been talk of the public prosecutor dropping the charges, thereby meeting one of the central militant demands.

But while talks get going, violence has continued.

In the last few weeks, kidnappers have taken foreigners from aluminium and petrochemicals plants in the delta, key sectors of the non-oil economy which had only just begun to attract new private investment after years of neglect.

Activists say foreign investors, whose decisions lag behind developments on the ground, could step up their withdrawal from the region just as things start to improve.

Britain last week advised all its nationals to leave three states at the heart of the delta due to the rise in kidnapping, robbery and other armed attacks.

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