Rigging for Oil

Rigging for Oil
Tchinda Pierre Ernest and Akong Charles Ndika
TNI Energy Project/Global Village Cameroon, 24 December 2002

It's just a few strokes to midnight on the war clock and the international community is jittery as the United States vies for the outright replacement of Saddam Hussein - a move justified by Iraq's recalcitrant harbouring of weapons of mass destruction. But beneath the crisp edges of the good-versus-evil veneer, is the imperative to keep an oil-thirsty U.S in good supply. Even as anti-US sentiment peaks with the beat of war-drums in the Middle East, Africa is scrambling to help the US to its' oil. At the Sixth Annual Conference on Oil, Gas, Trade and Finance, which took place in late September 2002 under the auspices of the United Nations Conference on Trade and Development (UNCTAD), fossil fuel chieftains from forty African countries converged at Yaounde Conference Centre in Cameroon to decipher the changes sweeping Africa's oil and gas sectors and showcase Africa's oil potential.

Revenues from oil and gas could improve life for close to one billion Africans now living below the one-dollar mark, according to UNCTAD. But this assessment is undone by the facts that oil dependence rarely equates to real development; there are more modest development options readily available but under-utilised; and that it is not in Africa's interests to commit exclusively to fossil fuel intensive development.

The truth is oil mining does not equate to the prosperity the international financial institutions give it credit for. Scrutiny of the oft-noted economic virtues of oil mining contrast with the bigger drawbacks on the ground. And the statistics of frontline oil producing countries don't suggest poverty alleviation. Nigeria, the seventh biggest producer of oil in the world, was ranked 142 by the Human Development Report 1998. Angola was even worse off at 156th. If access to modern energy services is an indication of development, just five percent of Nigeria's population is connected to an electricity grid. In the Middle East, where oil is the bedrock of the economy, one would expect a comparable level of prosperity with the West, but in 1997, per capita income in OPEC countries (US$1930) still trailed that of the European Union (US$ 24730) and Japan ($36716). The livelihood of communities around mine-sites attests to the sorry state of the oil industry in Africa. Human-rights abuses are rife - the case of Ken Sara Wiwa of Nigeria is indelible - and basic essentials such housing, roads, electricity and water remain scarce. Water pollution in the Oogonie region of Nigeria is sixty times above what is considered acceptable in the US.

The world is already feeling the effects of its addiction to fossil fuels and Africa is the least equipped to stand the consequences of climate change as the extreme weather events of recent years have painfully demonstrated. In Cameroon where the Conference was held, floods in 1997 displaced 249,000 people in the city of Douala alone and slashed Gross Domestic Product by 17 percent. Per-capita, Cameroon emits one-ninetieth the greenhouse gasses of the US, but "catching-up" and using oil revenues to build-up protection against such future events would seem a zero-sum game. Anyway, non-oil producing countries in Africa can't exercise this plan and are among the most vulnerable of all to global warming impacts: the island-state of Seychelles for example is wrestling with an unprecedented sea-level rise.

The litany of conflicts in Africa are exacerbated by the hunt for black gold with most oil rich countries being torn apart. Multinational companies - under the auspices of some western governments - stand by and even nurture them to their advantage. The population of the oil-rich Bakassi Peninsula is holding its' breath as Nigeria challenges the decision of the International Court of Justice to hand sovereignty to Cameroon. Full-scale war is a real possibility and oil-miners await this outcome like vultures on both sides of the divide. Despite the involvement of so many international financial institutions, oil remains the most opaque sector in African countries: oil-deals are always shrouded in secrecy. Despite a three-decade history in Cameroon, it wasn't until five years ago that oils' contribution made its debut appearance in state budgets.

Still, quiet progress is what favours the West's new courtship with Africa. The new goal according to Robin West, chairman of consulting firm, The Petroleum Financing Company, is to secure diversity of oil supplies making West and Central Africa a more important source to the international markets than Russia in the near and medium term. "Energy from Africa plays an increasingly important role in our security", confirmed the US Energy Secretary in June. With the US contriving to weaken the oil cartel, OPEC's grip on the market for the long term, deals in non-OPEC member countries like Cameroon, Equatorial Guinea, and Chad are key. In September, the Bush administration also sent Secretary of State, Colin Powell, to Angola and Gabon, both mega-oil exporters to the United States. During the September 11th commemorations in New York, Mr Bush met with ten Central African Presidents - along with the premiers of non-African oil producing nations - and plans to visit Africa early next year when oil will be at the heart of the discussions.

But the key to global energy security is not the diversity of supply regions but the diversity of supply vectors. Conventional wisdom has it that the goals of energy security and sustainable development would oblige the diversification of technology and resource reliance. This would imply at least an equal amount of public spending on developing renewable resources. In Africa's case in particular, renewable energy holds enormous potential to boost sustainable development. Decentralised energy can promote independence, particularly for the multitudes of rural Africans living remote from power grids but the US seems set on committing itself to a fossil fuel dependence and taking Africa with it.

Africa will suffer the impacts of climate change linked to historical the fossil-fuel reliance of wealthier countries regardless of its own development path but can better its adaptive capability and avoid its future contribution to the problem by developing sustainably.

Perversely, the strange but strengthening union between the UN and the oil industry frustrated attempts to gain agreement on a binding renewable energy quota at this years' World Summit for Sustainable Development. At the end of the conference a draft oil and gas code for Africa did emerge, but the absence of civil society institutions in the process, as usual, delivered oil industry preferences and insulated talks from public scrutiny. With the blessing of international financial institutions like the World Bank, the political risk associated with 'black gold' is insured at the public expense so that the narrow, short term interest of Africa's oil-grabbers will continue to take precedence over the broader, long-term public interest.