Can Petroleum Aid development?

In its bid to take control of one of the most lucrative oil fields in Nigeria, OPL 245, oil giant, Shell, ably assisted by senior Nigerian officials, condoned illegalities, subverted laid down rules and then lied repeatedly to cover its track, an ongoing PREMIUM TIMES investigation has shown.

Further investigations by PREMIUM TIMES have however shown that 10 years before Shell made the controversial payment in 2011, the oil giant had tolerated illegalities committed by Malabu and colluded with the company in compromising Nigerian officials and subverting the regulations and guidelines under which the oil block was awarded.

Fully aware of the huge reserve OPL 245 holds, Mr. Etete and Mohammed Sani (Abacha) used executive fiat to discretionally award the block to themselves, through Malabu, a company they hurriedly cobbled together. Mr. Etete was petroleum minister at the time while General Sani Abacha, Mohammed’s father, was Nigeria’s head of state. To conceal the fact that he awarded the block to himself and shield himself from public scrutiny, Mr. Etete designed an ingenious scheme. He created a fictional character, Kweku Amafegha, and made him one of the three shareholders of Malabu, the others being Mr. Abacha and Hassan Hindu (wife of Hassan Adamu, former Nigerian Ambassador to the UK, who is popularly known as Wakili Adamawa).

The House of Representatives on Thursday resolved not to let the N155 billion oil block scandal involving Nigerian government officials, two multinational oil giants (Shell and Agip), and a Nigerian company (Malabu Oil and Gas) be swept under the carpet as legislators decided to investigate the shady deal.

While the House sees a scandal in the transaction, the Senate has said it would not investigate the matter unless there is a formal petition before it. Its spokesman, Eyinnaya Abaribe, in a telephone interview told PREMIUM TIMES that newspaper reports were not enough bases for the upper chamber to investigate such a monumental fraud. “Do we just wake up and start to do our work based on reports in the newspapers?”Mr. Abaribe queried

Just a few miles from Rukwanzi six Congolese were killed in September 2007, shot at by the Ugandan army while they travelled in a passenger ferry from the island to the DRC shore. It was revealed last week that Heritage Oil and Gas, the British wildcat explorer founded by former mercenary Tony Buckingham, played a key role in triggering that military operation after its staff had crossed illegally into Congolese waters.

The reckless actions of a British oil company could conceivably have led to war. That it did not reflects Congolese weakness and Ugandan calculation. There were fears in Kinshasa at the time that Jean-Pierre Bemba was likely to return from Belgium with Ugandan support. Laurent Nkunda's CNDP was engaged in its strongest offensive to date in North Kivu and the old Ugandan interventionist tendency was increasingly on show.

Now the oil majors are entering the market, they are using a different argument - that the wider regional choice means they must be incentivised to invest in one country over another. When China National Offshore Oil Corporation (Cnooc) struck a deal with Tullow to develop Uganda's fields, it warned 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 or Ethiopia.

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.”

The Angolan government, led by reformed socialist strongman President Jose Eduardo dos Santos since 1979, has recently touted its oil wealth, economic growth and social stability to attract foreign investment, but avoids the topic of political repression and glaring economic disparities. Rights organizations like Amnesty International and Human Rights Watch have criticized the government's use of violence to silence critics, exemplified by the recent attack on the 10 activists in Luanda. "This brutal beating highlights the ongoing threat of violence that anyone speaking up for free speech in Angola faces," Muluka-Anne Miti, Amnesty International's Angola researcher, said in a statement.

We do not really know when this oil spill happened. It seems to have occurred over a week now. Although Shell is claiming it was as a result of sabotage, we know the company is lying again. What we know is that Shell was working on its pipeline and it was as a result of that work that this spill occurred. They were flushing the pipeline from Well 3 and that was the cause.

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.

Although the area contains the world's largest tiger reserve, according to reporter Thomas Maung Shwe of Mizzima news service, ‘the Burmese regime has encouraged logging, gold mining, large scale farms and the building of factories inside’. As the scandal grew, Silver Wave denied what its own press release had announced, but conceded it would drill near the reserve.

A company this dastardly is a high risk, and to prove the point, Silver Wave's environmental impact document includes a description of the notorious Agulhas Current, which begins at the Mozambique border: ‘Compared to other western boundary currents the Agulhas Current adjacent to southern Africa's East Coast exhibits a remarkable stability.’ Huh? In reality, the Natal Pulse races down the Agulhas a half-dozen times each year, pushing 20km per day. It is one reason Durban's coastline hosts more than 50 major ship carcasses. Creating havoc further south on the Wild Coast, the Pulse contributes to the rouge waves that have sunk 1,000 more vessels in what is considered one of the world's most dangerous shipping corridors.

Daily, poisons are flared onto thousands of neighbouring residents. The Indian, coloured and African communities suffer the world's highest-ever recorded asthma rate in a school (52 per cent of kids), as Settlers Primary sits next to the country's largest paper mill (Mondi) and between two refineries: one run by Engen, Chevron and Total; and the other, called Sapref, by BP, Shell and Thebe Investments. Sapref's worst leak so far was 1.5 million litres into the Bluff Nature Reserve and adjoining residences in 2001.

The initiative for not extracting the oil was originally proposed 20 years ago by Fundación Natura, the largest environmental organisation in Ecuador, and has since been supported by a number of environmental and indigenous groups defending the Yasuní National Park and its buffer zone, where the oilfields are located.

But there are strong supporters for drilling, like the deputy minister of non-renewable natural resources and former manager of the state oil firm Petroecuador, Carlos Pareja, and President Correa himself has talked extensively about "Plan B".

Meanwhile, the German government said it will not support the Yasuní-ITT initiative, because the precedent might be imitated by other countries. The announcement came as very bad news for the initiative.

The World Bank is providing funding for the gas project and Bank officials do not understand why the project is stalling.

Yeboah’s article focuses on citizens’ grievances in Bonyere and the neighboring communities.  Although it is unlikely that community concerns are the main cause of the project delays, it does appear that the government still has some significant community relations issues to resolve.

Gary explains that, “too often, projects suffer from an ‘original sin’ – affected communities were not adequately consulted prior to the investment decision and had little say about how and whether these projects were developed.”

The less attractive possibility is that there is much more money to be made by Shell on a global basis by stemming oil flow from Nigeria than in keeping it flowing.

According him, what Shell is doing, is merely restructuring its port folio by divesting from small oil fields, which he noted was not a strange practice globally,