By Barry Moody

ABUJA, April 21 (Reuters) - Nigeria votes on Saturday in a presidential election beset by fears that abuses and violence will wreck a milestone in African democracy.

Concern that Nigeria's first handover from one civilian leader to another would be compromised was underlined only hours before the vote when militants attacked government buildings in Nigeria's oil region with dynamite and assault rifles.

An activist in touch with the militants who attacked Yenagoa, capital of Bayelsa state in the oil delta, said they were angry about results of a regional election a week ago. There were no immediate reports of casualties.

The presidential poll has widely been seen as a watershed both for Africa's most populous country and the continent itself.

But wholesale rigging in many places during the state elections, in which 50 people died, and opposition allegations of more abuses even before polls opened on Saturday, have fuelled pessimism about the success of the vote.

"I expect more blatant rigging," said respected political columnist Pini Jason. "I quite disagree with those who take this charade as a sign there is hope for democracy in Africa."

The main opposition challenger, former army ruler Muhammadu Buhari, called it the worst election in Nigerian history.

World oil prices rose because of concern that election turmoil could further cut supplies from the world's eighth-largest exporter, where 500,000 barrels a day have been shut down for a year because of militant attacks in the delta.

But officials from President Olusegun Obasanjo on down said Saturday's vote would be historic. In a nationwide address on Friday the president asked observers not to "exaggerate the negative."

"Let us continue to improve on the structure and the house rather than pull it down because it is leaking in part."

There was also concern that freshly printed ballot papers, held back to avoid tampering, would not arrive in time at 150,000 polling stations scattered around this huge country to serve 60 million voters.

LATE START

Authorities said polls would open two hours later than scheduled, at 0900 GMT, to give more time for ballots to arrive.

The ballots had to be altered after the Supreme Court on Monday struck down a disqualification of Vice President Atiku Abubakar, arch-enemy of outgoing President Olusegun Obasanjo.

The opposition charged that rigging began 24 hours before the vote, saying hundreds of their sympathisers had been arrested and troops had intercepted a truck in the northern city of Kaduna carrying ballots already marked up for Obasanjo's ruling People's Democratic Party (PDP).

Authorities denied any ballots had been doctored.

Regional polls last week were declared a landslide for the PDP despite reports of every kind of rigging, from stolen ballot boxes to ghost voters and intimidation. Election observers said many results did not reflect the will of the people and 10 of 36 state polls should be rerun.

The PDP is fielding an obscure state governor, Umaru Yar'Adua, as its presidential candidate, but the opposition says he is a puppet intended to perpetuate Obasanjo's power.

Obasanjo became president in 1999 after three decades of almost continuous army rule. He failed to alter the constitution to allow him a third term.

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