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Arabica Robusta

Extreme Oil: Costly, Dirty and Dangerous (Klare) | Informed Comment - 0 views

  • Once this surge in U.S. energy production was linked to a predicted boom in energy from Canada’s tar sands reserves, the results seemed obvious and uncontestable.  “North America,” he announced, “is becoming the new Middle East.”  Many other analysts have elaborated similarly on this rosy scenario, which now provides the foundation for Mitt Romney’s plan to achieve “energy independence” by 2020.
  • Perhaps the most notable example of this was Shell Oil’s costly failure to commence test drilling in the Alaskan Arctic.  After investing $4.5 billion and years of preparation, Shell was poised to drill five test wells this summer in the Beaufort and Chukchi Seas off Alaska’s northern and northwestern coasts.  However, on September 17th, a series of accidents and mishaps forced the company to announce that it would suspend operations until next summer — the only time when those waters are largely free of pack ice and so it is safer to drill.
  • Only after promising to take immensely costly protective measures and winning the support of the Obama administration — fearful of appearing to block “job creation” or “energy independence” during a presidential campaign — did the company obtain the necessary permits to proceed.  But some lawsuits remain in play and, with this latest delay, Shell’s opponents will have added time and ammunition.
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  • Another unexpected impediment to the arrival of energy’s next “golden age” in North America emerged even more unexpectedly from this summer’s record-breaking drought, which still has 80% of U.S. agricultural land in its grip.  The energy angle on all this was, however, a surprise.
  • If this year’s “endless summer” of unrelenting drought were just a fluke, and we could expect abundant water in the future, the golden age scenario might still be viable.  But most climate scientists suggest that severe drought is likely to become the “new normal” in many parts of the United States, putting the fracking boom very much into question. 
  • If the U.S. proves too tough a nut to crack, Alberta has a backup plan: construction of the Northern Gateway, a proposed pipeline through British Columbia for the export of tar sands oil to Asia.  However, it, too, is running into trouble.  Environmentalists and native communities in that province are implacably opposed and have threatened civil disobedience to prevent its construction (with major protests already set for October 22nd outside the Parliament Building in Victoria).
  • While output from unconventional oil operations in the U.S. and Canada is likely to show some growth in the years ahead, there is no “golden age” on the horizon, only various kinds of potentially disastrous scenarios.  Those like Mitt Romney who claim that the United States can achieve energy “independence” by 2020 or any other near-term date are only fooling themselves, and perhaps some elements of the American public. 
  • The drought’s impact on hydro-fracking became strikingly evident when, in June and July, wells and streams started drying up in many drought-stricken areas and drillers suddenly found themselves competing with hard-pressed food-producers for whatever water was available. 
Arabica Robusta

Monthly Review September 2006 Michael Watts ¦ Empire of Oil: Capitalist Dispo... - 0 views

  • Although Africa is not as well endowed in hydrocarbons (both oil and gas) as the Gulf states, the continent “is all set to balance power,” and as a consequence it is “the subject of fierce competition by energy companies.” IHS Energy—one of the oil industry’s major consulting companies—expects African oil production, especially along the Atlantic littoral, to attract “huge exploration investment” contributing over 30 percent of world liquid hydrocarbon production by 2010. Over the last five years when new oilfield discoveries were scarce, one in every four barrels of new petroleum discovered outside of Northern America was found in Africa. A new scramble is in the making. The battleground consists of the rich African oilfields
  • Africa is, according to the intelligence community, the “new frontier” in the fight against revolutionary Islam. Energy security, it turns out, is a terrifying hybrid of the old and the new: primitive accumulation and American militarism coupled to the war on terror.
  • To see the African crisis, however, as a moral or ethical failure on the part of the “international community” (not least in its failure to meet the pledges promised by the Millennium Development Goals of reducing poverty by half by 2015) is only a partial truth. The real crisis of Africa is that after twenty-five years of brutal neoliberal reform, and savage World Bank structural adjustment and IMF stabilization, African development has failed catastrophically.
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  • The pillaging and privatization of the state—whatever its African “pathologies”—and the African commons is the most extraordinary spectacle of accumulation by dispossession, all made in the name of foreign assistance. The involution of the African city, notes Davis, has as its corollary not an insurgent lumpenproletariat but rather a vast political universe of Islamism and Pentecostalism. It is this occult world of invisible powers—whether populist Islam in Kano or witchcraft in Soweto—that represents the most compelling ideological legacy of neoliberal utopianism in Africa.
  • The African accumulation crisis, and the dynamics of capital and trade flows, are in practice complex and uneven. In addition to oil (and the very few cases of manufacturing growth in places like Mauritius which are little more than national export-processing platforms), the other source of economic dynamism is the (uneven) emergence of global value chains. This can be seen especially in relation to high-value agricultures (fresh fruits and vegetables) in South Africa, flowers in Kenya, green beans in Senegal. Such forms of contract production, typically buyer-driven commodity chains in which retailers exert enormous power, have created islands of agrarian capitalism that contribute to and deepen patterns of existing inequality across Africa and further the interests of business elites, which are often not African. The deepening of commodification in the countryside in tandem with demographic pressures (caused as much by civil war and displacement as high fertility regimes) has made land struggles a vivid part of the new landscape of African development.
  • It is no surprise that against this backdrop the development establishment flails around wildly. On the one side stands former World Bank economist William Easterly for whom all aid (“planning”) has been a total (and unaccountable) failure.
  • On the other stands the one-man industry otherwise known as Jeffrey Sachs who seeks to expand foreign aid—$30 billion a year for Africa—and to initiate a Global Compact by which “the rich will help save the poor,” who are as much hampered by poor physical geography as governance failure.
  • In reality what is on offer is an even bleaker world of military neoliberalism. At one pole are enclaves of often militarily fortified accumulation (of which the oil complex is the paradigmatic case) and the violent, sometimes chaotic, markets so graphically depicted in the documentary film Darwin’s Nightmare. At the other pole are the black holes of recession, withdrawal, and uneven commodification. These complex trajectories of accumulation are dominated at this moment by the centrality of extraction and a return to primary commodity production.
  • All African governments have organized their oil sectors through state oil companies that have some forms of collaborative venture with the major transnational oil companies (customarily operated through oil leases and joint memoranda of understanding).
    • Arabica Robusta
       
      Production share arrangements and joint ventures.
  • In general the international oil companies operating in Africa have production share arrangements with state oil companies (Nigeria is the exception which operates largely through joint ventures).
  • The nightmarish legacy of oil politics must be traced back to the heady boom days of the 1970s. The boom detonated a huge influx of petro-dollars and launched an ambitious (and largely autocratic) state-led modernization program. Central to the operations of the new oil economy was the emergence of an “oil complex” that overlaps with, but is not identical to, the “petro-state.” The latter is comprised of several key institutional elements: (1) a statutory monopoly over mineral exploitation, (2) a nationalized (state) oil company that operates through joint ventures with oil majors who are granted territorial concessions (blocs), (3) the security apparatuses of the state (often working in a complementary fashion with the private security forces of the companies) who ensure that costly investments are secured, (4) the oil producing communities themselves within whose customary jurisdiction the wells are located, and (5) a political mechanism by which oil revenues are distributed.
  • The oil revenue distribution question—whether in a federal system like Nigeria or in an autocratic monarchy like Saudi Arabia—is an indispensable part of understanding the combustible politics of imperial oil.
  • there has been a process of radical fiscal centralism in which the oil-producing states (composed of ethnic minorities) have lost and the non-oil producing ethnic majorities have gained—by fair means or foul.
  • the oil complex. First, the geo-strategic interest in oil means that military and other forces are part of the local oil complex. Second, local and global civil society enters into the oil complex either through transnational advocacy groups concerned with human rights and the transparency of the entire oil sector, or through local social movements and NGOs fighting over the consequences of the oil industry and the accountability of the petro-state. Third, the transnational oil business—the majors, the independents, and the vast service industry—are actively involved in the process of local development through community development, corporate social responsibility and stakeholder inclusion. Fourth, the inevitable struggle over oil wealth—who controls and owns it, who has rights over it, and how the wealth is to be deployed and used—inserts a panoply of local political forces (ethnic militias, paramilitaries, separatist movements, and so on) into the operations of the oil complex (the conditions in Colombia are an exemplary case). In some circumstances oil operations are the object of civil wars. Fifth, multilateral development agencies (the IMF and the IBRD) and financial corporations like the export credit agencies appear as key “brokers” in the construction and expansion of the energy sectors in oil-producing states (and latterly the multilaterals are pressured to become the enforcers of transparency among governments and oil companies). And not least, there is the relationship between oil and the shady world of drugs, illicit wealth (oil theft for example), mercenaries, and the black economy.
  • oil complex is a sort of corporate enclave economy but also a center of political and economic calculation that can only be understood through the operation of a set of local, national, and transnational forces that can be dubbed as “imperial oil.” The struggle for resource control that has taken center stage o
    • Arabica Robusta
       
      oil complex as a corporate enclave economy.
  • The current crisis points to the fact that the oil-producing region in Nigeria now stands at the center of Nigerian politics—for four reasons. First, the efforts led by a number of Niger Delta states for “resource control” expanded access to and control over oil and oil revenues. Second, there was the struggle for self-determination of minority peoples in the region and the clamor for a sovereign national conference to rewrite the constitutional basis of the federation itself. Third, there is a crisis of rule in the region as a number of state and local governments are rendered helpless by militant youth movements, growing insecurity, and ugly intra-community, inter-ethnic, and state violence which—as the recent events point out—can threaten the flow of oil and the much vaunted energy security of the United States. And not least, there is the emergence of a so-called South-South Alliance making for a powerful coalition of small and hitherto politically marginalized oil producing states (Akwa Ibom, Bayelsa, Cross River, Delta, Ondo, and Rivers) capable of challenging the ruling ethnic majorities (the Hausa, the Yoruba, and the Ibo) in the run-up to the 2007 elections.
  • Not surprisingly the deadly operations of corporate oil, autocratic petro-states, and the violent potentialities of the oil complex have forced the question of transparency and accountability of oil operations onto the international agenda. Tony Blair’s Extractive Industries Transparency Initiative, the IMF’s oil diagnostics program, and the Soros Foundation’s Revenue Watch are all (voluntary) efforts to provide a veneer of respectability to a rank and turbulent industry. But the real action lies elsewhere. The danger is that the ongoing U.S. militarization of the region could amplify the presence of mercenaries and paramilitaries, creating conditions not unlike those in Colombia.
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    In reality what is on offer is an even bleaker world of military neoliberalism. At one pole are enclaves of often militarily fortified accumulation (of which the oil complex is the paradigmatic case) and the violent, sometimes chaotic, markets so graphica
Arabica Robusta

Attacks on the Press: Oil, Money, and the Press - Committee to Protect Journalists - 0 views

  • Whether all this oil will benefit the average citizen depends largely on whether extraction deals are handled in an open, transparent manner. A comparison between Brazil and Nigeria is instructive. The South American country provides monthly updates on oil production on a state website. Brazil became the seventh-largest economy in the world with the help of oil output, with 2011 per capita income of $12,594, according to World Bank statistics. In Nigeria, five decades of oil output have been mired in secrecy and conflict. Although the country's oil exports are comparable to those of Brazil, its per capita income is just $1,452.
  • While Uganda's 2005 Access to Information Act theoretically covers documents between the government and private companies, oil contracts typically have special provisions whereby both parties must consent before information is given to a third party, according to Gilbert Sendugwa, coordinator of the Africa Freedom of Information Centre in Uganda. The secrecy clauses prevent even parliament from getting key information, according to Dickens Kamugisha, chief executive of the Africa Institute for Energy Governance, a Kampala-based think tank that advocates for transparent energy policies.
  • Since few Ugandan authorities comply with requests under the access law, few journalists bother to use it. Sendugwa noted that all government ministers are required to report how they implement the information act. "We decided to test the law and sent an information request to parliament in November 2010 asking for the ministers' reports on their implementation of the Access to Information Act," he said. "To this date, none have complied."
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  • The anti-corruption research organization Global Witness also analyzed the bills and concluded that all three lack guarantees on contract and financial transparency.
  • Though the act offers broad assurances that oil information is public, a provision allows the ministry to determine whether or not a particular oil contract is published, said Dana Wilkins, a campaigner for Global Witness. No contract had been made public as of late 2012.
  • Officials and oil companies in Uganda try to control the message by providing organized tours of oil drilling facilities. The Ministry of Energy and Mineral Development's 2011 communication strategy paper recommends two media tours of the Albertine Graben oil-drilling area each year. "Sure, it's easy to go to oil areas for oil company-organized events," Ssekika said. "You can talk to district officials, etc. But when you go alone with your own view, that's a different story."
  • "When China National Offshore Oil Corporation [CNOOC] struck a deal with Tullow Oil to develop Uganda's fields, it warned [President Yoweri] Museveni that there wasn't time to wait for parliamentary debates over the issue--pausing now could mean Uganda losing its winning lottery ticket to Kenya," Lay wrote on the African Arguments news website. Tullow's communications manager in Kampala, Cathy Adengo, disputed that depiction. "Tullow did not push the Ugandan authorities into doing anything, considering we had a two-year wait to ratify the deal with CNOOC," Adengo said.
  • The company has faced further lawsuits over pollution in the Delta and alleged ties to the Nigerian military, according to Reuters. "Imagine, it took a court case launched in America before activities of oil companies were discovered," said Omoyele Sowore, publisher of the anti-corruption website Sahara Reporters and a former Niger Delta resident. The legal disputes resulted in an estimated loss of one million barrels of oil a day for the Nigerian government and private companies, according to Nigerian writer Orikinla Osinachi.
  • Oil revenues count for 80 percent of the national budget, yet the government is unable to determine the amount of oil extracted from its territory, according to Alex Awiti, an ecologist at Aga Khan University in Nairobi.
  • Nigeria's situation is not unique. Although Angola is the second-largest oil producer in Africa with an annual GDP of $101 billion and per capita income of nearly $9,000, more than two-thirds of its 8 million people live under the $2-a-day poverty line, according to the World Bank and news reports. These statistics, said Awiti, are rooted in the lack of transparency in Angola's oil production--leading to corruption, millions of dollars being stashed abroad, and revenue sequestered in a secret "parallel budget." In 2012, the International Monetary Fund attributed a $32 billion gap in Angola's state funds from 2007 to 2010 to "quasi-fiscal operations by the state-owned oil company."
  • With oil output still in early stages in East Africa, the region has time to learn from other oil-producing countries. Chad has drilled oil since 2003, with the contracts kept secret. "The fact is Chadians do not know how many barrels are actually produced and where the money goes," said former N'Djaména Hebdo journalist Augustin Zusanne, who now works for the United Nations. Without such information, residents can hardly press for more development. "Even the oil-producing region, Doba, does not benefit from oil revenues. The population of this area lives in poverty," said Eric Topona, a journalist with the state broadcaster. However, things might improve, as Chad is now a candidate for membership in the Extractive Industries Transparency Initiative (EITI), an international forum that seeks openness by ensuring that oil payments are published annually. Government officials, oil companies, and civil society organizations oversee the process.
    • Arabica Robusta
       
      Does the EITI truly help encourage countries to be transparent?
  • In its 2008 Oil and Gas Policy, Uganda said it would apply for membership in the EITI, but it did not say when and nothing has been implemented, according to news reports. "The way the EITI section is drafted clearly shows a government that is not sincere or ready to implement--it's so vague," Kamugisha of the Africa Institute for Energy Governance said in describing the Ugandan policy. Kenya has made no commitment to join the Initiative. Eddie Rich, deputy head of the EITI secretariat, confirmed that South Sudan and Uganda have made public commitments to implement the initiative and said "international partners are working with those governments to progress toward official applications." None of the African countries working with EITI are disclosing information on compensation to local people affected by oil production, Rich said.
  • But East Africa does not have to look overseas for mentors: Ghana, Liberia, and even the Democratic Republic of Congo publish oil contracts. "It took years, but contracts are now in the public domain," said Ghanaian development economist Charles Abugre, who vigorously campaigned for publication.
Arabica Robusta

Pambazuka - Leave new oil in the soil in Africa - 0 views

  • The desire to capture more oil reserves is driving exploration and development of oil and gas fields in Eritrea, Ethiopia, Somaliland, Puntland, Somalia, Kenya, Uganda, Rwanda, Burundi, Tanzania, Mozambique, Madagascar, Malawi, Mauritius, the Comoros, Seychelles and the coast of Durban in South Africa.
  • The National oil spill detection and response agency (NOSDRA), the United Nations Environment Programme (UNEP) and the United Nations Development Programme (UNDP) have identified over 2,000 spill sites that need to be remediated. Some of these spills happened over 40 years ago. The Ebubu spill that occurred in 1970, has not been cleaned up and Shell, the company implicated in the disaster, is vigorously appealing a judgement of a federal high court which ordered it to pay US$40 million compensation as at 2001.[3]
  • Even though Ikiogha is the government bureaucrat in charge of penalising Shell for the spill and signing off on the cleanup, he is also the contractor hired by Shell to do the cleanup… His cleanup operation consists of four shirtless men scooping oil from the surface of the polluted river with Frisbees… he claims that most of the oil had earlier been removed with absorbent foam and blankets.’[5]
    • Arabica Robusta
       
      Kenneth Feinburg.
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  • The idea of leaving oil in the ground within the Yasuni forest was taken up in far away Ecuador by no less than the government of the country itself and is receiving widespread acceptance.
  • The world’s ecosystem is one and we have merely scratched the surface in understanding the intricate interconnectedness of nature at different levels. It is therefore short sighted to continue the reckless expansion of drilling around the world because in the long run the revenue we may earn today from oil extraction would not be sufficient to adequately return our environment to what it was before extraction when incidents like these occur.
  • We must begin by acknowledging that the sensible use of our ecosystem has the capacity in the long-term to provide much more benefits and revenue than oil can ever provide. We must individually and consciously take up the responsibility of drastically reducing our use of oil and its by-products. We must also set up international tribunals that would try entities and individuals for their role in destroying the ecosystem. But more importantly we must begin to have the consciousness and think along the lines of building capacities within our communities to ensure as much as possible that the role of oil our energy matrix becomes inconsequential by investing more in renewable energy, energy efficiency, better public transportation and small decentralised energy projects.
Arabica Robusta

Jubilee Oil Field Partners Can Flare Gas Against Ghana's Laws - Energy Analyst | OMGGha... - 0 views

  • An Energy Analyst, Muhammed Amin Adam has told Citi Business News, the current delays in the completion of the gas infrastructure project could allow the Jubilee Oil field partners minimum flaring opportunity.This is as a result of the current operational challenges government is having with the lead contractor on the SINOPEC project.China’s SINOPEC has threatened to abandon the project following serious financial challenges government is confronted with in paying SINOPEC for pre-financing the project.
  • “in this case the law also allows that you can flare for operational reasons and you can flare when you are compelled to. So in this circumstance when we are not ready with our gas infrastructure they are compelled to flare, in that case we will have no course to make any case against them”.
Arabica Robusta

The World Bank's new energy strategy (Bretton Woods Project) - 0 views

  • Based upon the model implemented in England and Wales and in some parts of the United States and Latin America, reforms were geared towards restructuring and privatising state-owned electricity utilities in order to try to improve efficiency through competitive wholesale electricity markets.
  • The impact of reform on poverty reduction also became a cause for concern. Even where private sector participation had occurred, expanding access to non-industrial consumers had been considered unprofitable. Stark figures for household access levels, such as 2 billion people without access to electricity worldwide, were difficult to ignoreii.
  • interestingly, PSMPs tend to emphasise use of large-scale generation projects to exploit hydro and thermal potential and regional integration of grid networks. Whilst a stable grid serving the entire population might be an attractive long-term goal, rarely has such distributional equity been achieved. More often than not, grid extension programmes have failed to reach the rural poor because they have not always proven to be the most cost-effective means of expanding access to rural areas, mainly due to low population density and greater technical losses as transmission networks increase.
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  • the mobilisation of private investment is still very important and Bank funding can play a key role in leveraging it. Private investors look to fund ‘bankable’ projects – projects with low risk and quick returns. The result is a bias toward established fossil fuel technologies. Given this bias, when the Bank aims to leverage private sector investment, its funds should be directed towards making low-carbon energy technologies commercially available and competitive.
Arabica Robusta

Oil City: Where are the Jobs, pt. 2 | Pipe(line)Dreams - 0 views

  • Both Tullow Oil and Kosmos Energy have posted scam alerts on their websites. Here’s the warning from Kosmos: NOTE: POTENTIAL RECRUITMENT FRAUD Kosmos Energy has learned that job applicants in the international oil and gas business, as well as other industry sectors, may be contacted by individuals or organizations that offer false employment opportunities. These communications are often via email and may request personal information or money. Kosmos only makes job offers after candidates have completed a formal interview process and does not ask applicants to pay fees during recruitment. Specifically, please note that any communications from or about the “Kosmos Group” are not associated with Kosmos Energy. This is good, but I don’t know how useful these alerts are. There are a lot of people in Takoradi who don’t have internet access. And even when you get to the Tullow or Kosmos websites, it’s not easy to get information.
    • Arabica Robusta
       
      Corporate websites as greenwashers.  They know that consumer "stakeholders" are the audience because producing areas have very limited access to Internet.
Arabica Robusta

Ghana's oil worries | Pipe(line)Dreams - 0 views

  • Another article, How Overpriced is Ghana’s Jubilee Field Expansion Project?, questions the projected cost of the Jubilee expansion. The higher the costs, the lower the revenues for Ghana. “It is important to note,” the article states, “that the more money that is spent on the project the longer it takes for the field to be profitable, the lower the taxes Ghana can collect, and the longer it takes for even those meagre taxes to show up.” Besides providing an important public service, the IMANI articles have also prompted a response from the Ghana National Petroleum Corporation.  You can read the lengthy GNPC press release on Ghana Oil Watch: Recent Media Discussions on GNPC and Jubilee Oil. The press release refutes IMANI’s allegations and IMANI has since issued a final statement backing up the think tank’s original estimates and statements.
  • Rather uncharacteristic of the secretive organisation, the Ghana National Petroleum Corporation (GNPC) finally issued a press statement to respond to concerns raised by civil society about Ghana’s underperforming oil industry. While the GNPC is to be commended for its increasing responsiveness and transparency … The truth is that the information the GNPC has now supplied to inform the public debate about Ghana’s oil sector would not have received broad coverage had IMANI not engaged in strong advocacy to demand such information.
  • On a somewhat related note, a U.S. law firm has announced it investigation of potential claims against KOSMOS Energy, one of the Jubilee partners: The investigation concerns allegations that the Registration Statement and Prospectus issued in connection with the Company’s initial public offering (the “IPO”) were materially false and misleading and misrepresented or failed to disclose that:
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    "I have a decent internet connection this morning, so I'll take advantage of that to post some of the back and forth between Ghanaian think tank, IMANI, and the Ghana National Petroleum Corporation (GNPC). IMANI has recently published some interesting articles on the Jubilee field's underperformance. In contrast to the excited tone of most of the business news about the country's oil industry, the IMANI articles raise serious questions about the industry's costs and prospects."
Arabica Robusta

CONVERGENT INTERESTS: U.S. Energy Security and the "Securing" of Nigerian Democracy - 0 views

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    "Nigeria has been a particular target of this shift in energy security policy, not only as a strategic ally in the region but also as a "front line" state in the Global War on Terrorism (GWOT). Like its predecessor, anti-communism, the GWOT is a timeless, borderless geopolitical strategy whose presumptions lead to defining all conflicts, insurrections and civil wars as terrorist threats, regardless of the facts on the ground."
Arabica Robusta

Report card: Ghana oil gets a "C" | Pipe(line)Dreams - 0 views

  • the most encouraging sign was not the grades on the report card, but the presence of several officials at the event including a member of parliament, the communications director from Tullow Oil, the World Bank country director for Ghana and a Deputy Minister of Energy. Although some of the officials’ comments were perfunctory and fairly predictable, their attendance at least signaled the recognition of civil society as an important stakeholder in Ghana’s oil development. 
    • Arabica Robusta
       
      Will this continue, or are the hegemonic organizations present simply to grease the skids and get petroleum exploitation started?
  • On transparency and citizen participation, for example, the government received “B” grades. Regarding transparency, the report states, “On the positive side, Ghana’s parliament passed the long-delayed and debated petroleum revenue management bill at the beginning of March 2011. The bill is now awaiting presidential approval. While some issues were hotly debated, there was consensus from both the majority and the minority members of parliament on all the transparency provisions. Should the bill approved by parliament become law, there will be a number of important transparency provisions.”
  • Of particular concern is the lack of a legal framework for dealing with oil spills: “The institutional weakness in the environmental protection institutions was demonstrated during the investigation into mud spillage by Kosmos Energy.
Arabica Robusta

West using terror to plunder oil resources of Nigeria | nsnbc - 0 views

  • With a population of 160 million, Nigeria is the known as the “giant of Africa”. In addition to crude oil, Nigeria has also the biggest reserves of natural gas among Sub-Saharan nations. Western energy companies are gearing up to tap this wealth even further in the coming years. Balkanising the country into North-South entities would undermine the central government in Abuja and bolster exploitation by these corporations.
  • However, some Nigerian analysts believe that the organization is being used by powerful external forces as a conduit for destabilizing Nigeria. Political analyst Olufemi Ijebuode says: “The upshot of this latest massacre is to destabilize the state of Nigeria by sowing sectarian divisions among the population. The killers may have been Boko Haram operatives, but Boko Haram is a proxy organization working on behalf of foreign powers.”
  • Campbell reiterated the significant observation: “The Mubi atrocity will feed a popular perception that the government can no longer ensure security in large parts of the country.”
Arabica Robusta

Oil, Money and Secrecy in East Africa - Pipe(line)Dreams - 0 views

  • Last year I wrote a post on Tullow Oil’s secret deals in Uganda, contrasting that situation to Tullow’s much more transparent operations in Ghana. After I published that story a Tullow Oil representative contacted me and explained that Tullow’s practices were dictated by local governments. Tullow can be transparent in Ghana because the government wants to be transparent. In Uganda, the official told me, the government does not want contract information published.
  • While offering general endorsements of transparency, oil companies typically defer actual requests for contract and other information to governments. “I have tried to communicate with them but they instead refer me to local government officials,” said Kuich, the South Sudanese freelance journalist. Levi Obonyo, former chairman of Kenya’s independent Media Council, says bluntly that oil companies hide behind governments to avoid public scrutiny.
  • We shouldn’t forget that the S.E.C. adopted rules mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act requiring oil and gas companies to disclose payments to foreign governments (section 1504). At the time, The Wall Street Journal reported that,  “The rules for section 1504 set a $100,000 threshold, below which companies would not have to report payments. The rules do not contain exemptions for reporting “confidential or competitively sensitive information” or exemptions for instances in which reporting the payments might violate foreign laws.”
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  • The American Petroleum Institute filed a lawsuit agains the S.E.C. in October 2012, which would suggest that a number of oil companies are happy with the secrecy status-quo.
Arabica Robusta

allAfrica.com: Nigeria: Alison-Madueke, Shell Fingered in Shady U.S.$380 Billion OML Deal - 0 views

  • Nigeria's petroleum minister, Diezani Alison-Madueke oil giant, Shell Petroleum Development Company Ltd (SPDC) have been fingered in the shady sale of four oil blocks worth $380 billion (N58.9trillion), a petition to the Speaker, House of Representatives, Aminu Waziri Tambuwal disclosed, yesterday. The petition also alleged that two days before President Goodluck Jonathan dissolved the Federal Executive Council in 2011, officials of Shell and Alison-Madueke secretly transferred production rights in four large oil blocks, Oil Mining Licences (OMLs) 26, 30, 34 and 42, to Mr. Jide Omokore's Atlantic Energy Drilling Concept Limited, a company that neither tendered nor bidded for the blocks.
  • The protesters lamented what they described as a deliberate exclusion of indigenous rights of first refusal and the absence of transparent and open competitive bidding of Oil Mining Licences (OMLs) 26, 30, 34 and 42 respectively.
Arabica Robusta

Ghana government shown in another violation of Petroleum Revenue Management law - Ghana... - 0 views

  • the statutory body established to provide an independent assessment of how petroleum revenues are managed and used as stipulated by the Petroleum Revenue Management Act, 2011 (Act 815), says the Ministry of Energy has made payments from oil revenues into an account different from the one established by the law.
  • The Ministry, as the PIAC points out is indicating that oil revenues from the Saltpond oilfield in 2011 were paid into the Government Non-Tax Revenue Account. But according to the PIAC, “This account is quite different from the Petroleum Holding Fund into which they were required to make the payments further to the passage of Act 815 in April 2011.”
Arabica Robusta

Exxon 'loses' Venezuela nationalisation case - Features - Al Jazeera English - 0 views

  • In the latest showdown between western oil companies and Venezuela’s populist president, Exxon Mobil is widely seen as the loser, after the Paris-based International Chamber of Commerce (ICC) ruled that the world’s biggest oil company would not be entitled to most of the damages it demanded after its fields were nationalised.
  • Despite this recent victory, PDVSA is facing some trouble. Under Chavez, the energy giant has undertaken ambitious social spending, running subsidised food distribution programmes and international aid projects as if it were a state unto itself. Critics say oil companies should not be delivering government services. And the money used for "Bolivarian" projects means the corporation has less to invest in developing new reserves; production has dropped from about 3.3m barrels per day in 1998 to about 2.25m in 2011, The Economist reported.
  • Like many of its South American neighbours, Venezuela has drastically reduced poverty in the past decade; the Bolivarian Republic’s poverty rate fell from 48.6 per cent in 2002 to 27.8 per cent in 2010, according to the UN Commission for Latin America's 2011 report. Inequality also declined sharply. This progress is linked to tough negotiations with foreign oil companies, so the state can have more resources to invest in local communities, Chavez’s supporters contend.
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    This kind of oil company development is certainly more sustainable than self-interested CSR and public-private partnerships by corporations legally required to maximize their own profits.
Arabica Robusta

Pambazuka - The Chevron precedent - 0 views

  • The Bowoto case is the legal reaction to Chevron’s role in a 1998 protest by Nigerian community activists in the Niger Delta. The unarmed demonstrators boarded an oil platform and adjacent barge, property of subsidiary Chevron Nigeria Ltd, in protest over the environmental and economic damage caused by oil production in the region. The activists were attacked on 28 May by Nigerian authorities ferried to the floating protest by the oil corporation. Two men were killed and several more protestors injured. Three others claim detention and torture.
  • After nearly 10 years of pre-trial motions wherein many claims were dropped by a pre-trial judge, the case finally debuted in trial in October 2008 and a decision was handed down on 1 December the same year. The nine-bench jury decided in favour of Chevron, clearing the corporation of any liability under the various claims. It was a defendant’s victory, but civil society groups and legal experts still label the case a milestone in advancing corporate accountability.
  • The Bowoto case is the first time the multinational magnate Chevron USA Inc. has been successfully taken to a US court for the actions of an overseas subsidiary. ‘Chevron has a very intricate structure, used in part to try and shield itself from liability,’ Simons said. The case has effectively scrapped this corporate strategy.
    • Arabica Robusta
       
      To what extent will Chevron's corporate response strategy be scrapped by this decision?  It is a sad lesson in the state of corporate recklessness that a blanket victory for Chevron in court is nevertheless considered a "milestone in advancing corporate accountability."
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  • The case also broadens the recourse for victims of human rights abuse by American corporations, who can seek redress in US courts under the aiding-and-abetting theory used in Bowoto v. Chevron Corp. that a corporation can be held liable as a third party.
  • The ATS is a US law that lets foreign citizens bring claims to US courts for damages done outside of the country. Claims are rarely upheld however, because judges have narrowly interpreted how the ATS is applied. This happened in a 1993 class action suit against Chevron and subsidiary Texaco, representing some 30,000 residents in the Amazon according to Amnesty International. The case was dropped by the US courts and palmed off to Ecuador where it is still ongoing. Other corporations domestically unscathed after US courts dismissed ATS claims include Talisman Energy Inc., the Southern Peru Copper Corporation and Coca-Cola.
  • At trial the District Court judge found a corporation is not an individual and can therefore not be sued under the TVPA. ‘This is significant. Most of the important legal precedents in this case have already been set … this is the only rule of law question [in the appeal].’ The TVPA is a civil law that lets citizens file a suit against another party that, acting for a foreign nation, commits torture or extrajudicial killing. In Bowoto v. Chevron Corp. the TVPA claim was thrown out. The word ‘individual’, according to the trial judge, does not describe the multinational Chevron.
Arabica Robusta

Pambazuka - Banks, blood and chocolate - 0 views

  • the Jubilee Ghana MV 21 BV – a special purpose company[5] comprised of energy corporations – is incorporated in the Netherlands, one of the world’s leading tax havens that provides specific loopholes for corporate activities. The consortium owns the Kwame Nkrumah MV 21 – the Floating Production Storage and Offloading (FPSO) facility that will be used to exploit Ghana’s offshore oil during the first phase of development. Commenting on the Jubilee Ghana special purpose vehicle (SPV), Elmer explains that the intent is manifold: Protecting secrecy and providing legal, tax and regulatory relaxation. ‘In this case,’ he says, ‘there is a strong suspicion that the SPV [will] charge certain services to the company, therefore reducing the profit and the taxable profit. Another option is that certain currency or derivative deals with the company [will be] made with the same effect that the taxable profit is reduced in Ghana.’ The use of the Netherland’s opaque legal and financial vehicles are likely to facilitate revenue leakage, diminishing Ghana’s projected oil revenue, estimated to inject US$800 million into the economy from 2011 and 2029 (beginning with US$20 per person in 2011 before increasing to US$75 per person by 2017, if revenues are directly remitted to citizens).
    • Arabica Robusta
       
      How does this special purpose vehicle relate to the sterilization funds?  See, e.g., http://oxfordswfproject.com/2010/03/24/ghana-petroleum-funds-take-shape/
  • Ironically, though corporate mispricing accounts for 60 per cent of illicit flight from resource-rich developing nations, specifically those in oil and-mineral rich West Africa, Ghana vies to become the Netherlands of Africa. ‘Under the IFSC, Barclays Bank has been given the license to operate the first Offshore Bank in the sub region.’[10] Cumulatively, US$13 trillion in private wealth is stashed by tax evaders and avoiders in secrecy jurisdictions. If taxed at a moderate 7.5 per cent rate of return, these funds would yield US$865 billion dollars annually.
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