Black death

The civil war in Nigeria officially ended on this day in 1970 following two and a half years of conflict and the death of  millions.     Socialists did not support either side, holding that the workers and peasant farmers had no interest at stake in the capitalist rivalries within Nigeria or in the sordid intervention of Russia, France, Britain and other capitalist powers.   Recent reports, such as that from Amnesty International in November last year stating that government forces had killed at least 150 pro-Biafran activists,  indicate that these rivalries remain and divert workers from expressing their class solidarity.  

Further reading: Nigeria,Biafra and oil.

Protecting oil business not nature

The British government has offered support to a multi-billion pound plan to drill for oil in one of Africa’s oldest national parks. The UN has cautioned against drilling for oil in national parks due to the potential damage to ecosystems and the well-being of people living nearby.

The project, involving British company Tullow Oil; French firm Total and Chinese oil company CNOOC, could see dozens of wells drilled in Murchison Falls national park in Uganda. Tullow, together with its partners, would be investing $8 billion and drilling 500 wells in the three blocks, over the next 25 years. The park is home to one of the last remaining populations of the world’s most endangered species of giraffe, leading to warnings by experts that if the park is damaged the species could be at risk. Damage to the park has already occurred. The most intensive development lies within Exploration Area 1 (EA1), operated on behalf of the group by Total. Seventy percent of EA1 overlaps with the national park, including savannah habitat used by the endangered Rothschild’s giraffe, lions and elephants.

Small scale but irreparable damage has already occurred to the park as a result of a geological survey. An ecological compliance study found 283 instances of damage, 159 of which were found to be “non-restorable”. This included oil leakage; damage to trees and riverbanks and the destruction of termite mounds.

British trade officials have classed Tullow’s operations in the park as an “opportunity” worth over £1bn to UK businesses and have been keen to offer the firm financial backing. The government has held talks with Tullow about providing UK taxpayer-backed loans and insurance for its operations in the country.

Uganda is not the only example of British firms wishing to drill in national parks and other protected areas. British companies hold the rights to explore for oil in national parks and protected areas all over sub-Saharan Africa. Six British companies hold exploration licences covering at least 29 protected sites in eight countries.

This trend is at odds with the position of international institutions.

 A UN Environment spokesperson warned that: “Highly protected areas are protected because of their ecological value or vulnerability. In common with all industrial activity, mineral activity in such areas has the potential to impact this value adversely and/or enhance vulnerability with serious consequences to both biodiversity and human well-being.”

The International Union for Conservation of Nature (IUCN has a strict “no-go” policy regarding mining activities in protected areas. Kathy MacKinnon, Chair of IUCN’s World Commission on Protected Areas said the organisation: “encourages responsible companies not to seek exploration and production concessions within protected areas.”

Irene Ssekyana of Kampala-based NGO Greenwatch Uganda, stated, “It is a very sensitive ecosystem. We’re talking about a globally important area of biodiversity that supports a vibrant tourism industry. The government says they are going to minimise the footprint of the activities, but it’s not very convincing… as long as issues of corruption and governance are not dealt with, I do not think that the ordinary Ugandan will benefit…”

Tullow has refused to rule out drilling in protected areas, although it said it does have a policy against drilling in world heritage sites. The firm holds oil licence blocks overlapping 15 protected areas in Africa, said: “We don’t rule out drilling in protected areas full stop.” According to Tullow 40% of Uganda’s oil lies beneath Murchison Falls national park.

Angola's thief gets a new job

In Angola, controlling the oil fields is indelibly linked to controlling the country.

Angola’s president is keeping control of state resources in the family. Faced with a struggling economy as global oil prices slump, president Jose Eduardo dos Santos appointed his daughter Isabel as head of the state-owned oil company Sonangol which manages Angola’s lucrative oil and gas reserves and contributes to about half of the country’s annual GDP while fueling a precarious and lop-sided post-war boom. The drop in global oil prices have hit Angola hard, forcing the country to cut public investment by 53%. Sonangol reported a net profit $710 million last year, down from more than $3 billion, according to Bloomberg.

Isabel dos Santos, 43, is said to be worth some $3.3 billion, much of which is linked to the country’s fortunes. Her assets include 25% of Angola’s largest mobile telecommunications company, Unitel, a 7% stake in the Portuguese oil and gas firm Galp Energia, a controlling share of a Portuguese cable television company, a lucrative stake in one of Angola’s largest banks Banco BIC and still more. Her 18.6% stake in Portugal’s second largest largest bank BPI is up for sale. Isabel dos Santos also dabbles in retail and owns a Luanda nightclub. Her vast wealth has attracted scrutiny and European officials have called for an investigation into her European Union investments. Lauded investigative journalist and activist Rafael Marques de Morais has accused Isabel dos Santos of directly using state funds as seed capital for her investments.

Her brothers Welwitchea José dos Santos and José Paulino dos Santos own Semba, a thriving communications company that is contracted by the state to run various publicity and marketing projects, according to Marques and the company’s own portfolio. It also doubles as a modelling agency. Semba has been accused of receiving funds directly from Angola’s national budget.

http://qz.com/699211/africas-richest-woman-and-presidents-daughter-will-head-angolas-state-oil-company/

UK Oil Corruption in Somalia

A British oil company paid hundreds of thousands of dollars which went to senior Somali civil servants, according to a UN report. UN investigators say the payments by Soma Oil & Gas amount in some cases to "acts that undermine Somali public institutions through corruption". The firm’s chairman is the former Conservative Party leader Michael Howard.

The report details payments totalling $490,000 (£315,000) from Soma Oil & Gas to the Somali Ministry of Petroleum and Mineral Resources, beginning in June 2014. The money was ostensibly intended to cover the salaries of a small number of experts, including geologists and geoscientists. In reality though, the United Nations investigators say the scheme appears to have been used to "fund systematic payoffs to senior ministerial officials", some of whom were "instrumental in both securing the company's initial contract, and negotiating subsequent agreements".

One recipient of money under the scheme was Dr Farah Abdi Hassan, the director general of the ministry. He received $36,000 (£23,000) over a period of 12 months - about three times his Somali government salary, which investigators say he continued to draw. The report claims that Mr Hassan suggested in emails that Soma's contractual agreements with the government - both past and prospective - could be subject to review if financial "assistance" was not forthcoming.

The extent of Somalia's oil and gas reserves are unknown, but some estimates put it at as much as 110 billion barrels - nearly half that of Saudi Arabia. The United Nations in 2013 called for a moratorium on oil deals, saying that, in the absence of a legal and regulatory framework to share energy resources, such agreements could fuel violence and corruption in a country still struggling with clan tensions and battling an Islamist insurgency.

http://www.bbc.com/news/uk-33766676

Western Sahara and oil

Ireland-based oil company, San Leon Energy, is facing a potential legal challenge over its proposed drilling activity in the disputed North African territory, which Morocco describes as its Southern Provinces. Human rights group opposed to the drilling say oil exploration should be suspended while the future of Western Sahara is in dispute. Global Legal Action Network (GLAN), a human rights non-governmental organisation run by Irish lawyers say they will take a legal action against the company over the plan.

The Irish Government has previously called for a referendum to decide the future of Western Sahara. Minister for Foreign Affairs Charlie Flanagan said: "Under international law, the economic resources of a non-selfgoverning territory may only be exploited for the benefit of the people of the territory, on their behalf or in consultation with their representatives.

"Any exploration and exploitation activities that proceed in disregard of the interests of the people of Western Sahara would be in violation of the principles of international law."

San Leon's executive chairman Oisin Fanning said its activities are legally sound.

Ruairí McDermott of GLAN however told the Irish Independent "The right of a people to choose how or even whether to use their natural resources is one of the cornerstones of international human rights law."

Angola and the Oil Cabal

Tom Burgis has been tenacious and intrepid in confronting the powerful vested interests – corporate, military, financial and political – that have fed to excess off Africa’s riches. He has been reporting for the Financial Times for the last eight years, writing a series of prizewinning investigative reports from Johannesburg and Lagos.

Since the end of the civil war in 2002 (by then some five hundred thousand people had died), Angola, a nation of 20 million people, has notched up some of the fastest rates of economic growth recorded anywhere, at times even outstripping China. Angola boasts sub-Saharan Africa’s third-biggest economy, after Nigeria and South Africa. Luanda consistently ranks at the top of surveys of the world’s most expensive cities for expatriates, ahead of Singapore, Tokyo, and Zurich. In glistening five-star hotels like the one beside Chicala, an unspectacular sandwich costs $30. The monthly rent for a top-end unfurnished three-bedroom house is $15,000. Luxury car dealerships do a brisk trade servicing the SUVs of those whose income has risen faster than the potholes of the clogged thoroughfares can be filled. At Ilha de Luanda, the glamorous beachside strip of bars and restaurants a short boat-ride from Chicala, the elite’s offspring go ashore from their yachts to replenish their stocks of $2,000-a-bottle Dom Pérignon. The railways, the hotels, the growth rates, and the champagne all flow from the oil that lies under Angola’s soils and seabed. Oil accounts for 98 percent of Angola’s exports and about three-quarters of the government’s income.

“When the MPLA dropped its Marxist garb at the beginning of the 1990s,” writes Ricardo Soares de Oliveira, an authority on Angola, “the ruling elite enthusiastically converted to crony capitalism.” The court of the president—a few hundred families known as the Futungo, after Futungo de Belas, the old presidential palace— embarked on “the privatization of power.” Melding political and economic power like many a postcolonial elite, generals, MPLA bigwigs, and the family of José Eduardo dos Santos, took personal ownership of Angola’s riches. Isabel dos Santos, the president’s daughter, amassed interests from banking to television in Angola and Portugal. In January 2013 Forbes magazine named her Africa’s first female billionaire.

The task of turning Angola’s oil industry from a war chest into a machine for enriching Angola’s elite in peacetime fell to a stout, full-faced man with a winning grin and a neat moustache called Manuel Vicente. Blessed with what one associate calls “a head like a computer for numbers,” as a young man he had tutored schoolchildren to supplement his meager income and support his family. After a stint as an apprentice fitter, he studied electrical engineering. Though he had been raised by a lowly Luanda shoemaker and his washerwoman wife, Vicente ended up in the fold of dos Santos’s sister, thereby securing a family tie to the president. Vicente honed his knowledge of the oil industry at Imperial College in London. Back home he began his rise through the oil hierarchy. In 1999, as the war entered its endgame, dos Santos appointed him to run Sonangol, the Angolan state oil company that serves, in the words of Paula Cristina Roque, an Angola expert, as the “chief economic motor” of a “shadow government controlled and manipulated by the presidency.”

Vicente built Sonangol into a formidable operation. He drove hard bargains with the oil majors that have spent tens of billions of dollars developing Angola’s offshore oilfields, among them BP of the UK and Chevron and ExxonMobil of the United States. Despite the tough negotiations, Angola dazzled the majors and their executives respected Vicente. “Angola is for us a land of success,” said Jacques Marraud des Grottes, head of African exploration and production for Total of France, which pumped more of the country’s crude than anyone else.

On Vicente’s watch oil production almost tripled, approaching 2 million barrels a day—more than one in every fifty barrels pumped worldwide. Angola vied with Nigeria for the crown of Africa’s top oil exporter and became China’s second-biggest supplier, after Saudi Arabia, while also shipping significant quantities to Europe and the United States. Sonangol awarded itself stakes in oil ventures operated by foreign companies and used the revenues to push its tentacles into every corner of the domestic economy: property, health care, banking, aviation. It even has a professional football team. The foyer of the ultramodern tower in central Luanda that houses its headquarters is lined with marble, with comfortable seats for the droves of emissaries from West and East who come to seek crude and contracts. Few gain access to the highest floors of a company likened by one foreigner who has worked with it to “the Kremlin without the smiles.” In 2011 Sonangol’s $34 billion in revenues rivaled those of Amazon and Coca-Cola.

Oil is the lifeblood of the Futungo. When the International Monetary Fund examined Angola’s national accounts in 2011, it found that between 2007 and 2010 $32 billion had gone missing, a sum greater than the gross domestic product of each of forty-three African countries and equivalent to one in every four dollars that the Angolan economy generates annually. Most of the missing money could be traced to off-the-books spending by Sonangol; $4.2 billion was completely unaccounted  for. Having expanded the Futungo’s looting machine, Manuel Vicente graduated to the inner sanctum. Already a member of the MPLA’s politburo, he briefly served in a special post in charge of economic coordination before his appointment as dos Santos’s vice president, all the while retaining his role as Angola’s Mr. Oil. He left Sonangol’s downtown headquarters for the acacia-shaded villas of the cidade alta, the hilltop enclave built by Portuguese colonizers that serves today as the nerve center of the Futungo. Like its Chinese counterparts, the Futungo embraced capitalism without relaxing its grip on political power. It was not until 2012, after thirty-three years as president, that dos Santos won a mandate from the electorate— and only then after stacking the polls in his favor. Critics and protesters have been jailed, beaten, tortured, and executed. Although Angola is not a police state, the fear is palpable. An intelligence chief is purged, an airplane malfunctions, some activists are ambushed, and everyone realizes that they are potential targets. Security agents stand on corners, letting it be known that they are watching. No one wants to speak on the phone because they assume others are listening.

On the morning of Friday, February 10, 2012, the oil industry was buzzing with excitement. Cobalt International Energy, a Texan exploration company, had announced a sensational set of drilling results. At a depth beneath the Angolan seabed equivalent to half the height of Mount Everest, Cobalt had struck what it called a “world-class” reservoir of oil. The find had opened up one of the most promising new oil frontiers, with Cobalt perfectly placed either to pump the crude itself or sell up to one of the majors and earn a handsome profit for its owners. When the New York stock market opened, Cobalt’s shares rocketed. At one stage they were up 38 percent, a huge movement in a market where stocks rarely move by more than a couple of percentage points. By the end of the day the company’s market value stood at $13.3 billion, $4 billion more than the previous evening.

In July 2008, as Cobalt was negotiating exploration rights to put its theory about the potential of Angola’s “presalt” oil frontier to the test, the Angolans made a stipulation. Cobalt would have to take two little-known local companies as junior partners in the venture, each with a minority stake. Ostensibly the demand was part of the regime’s avowed goal of helping Angolans to gain a foothold in an industry that provides just 1 percent of jobs despite generating almost all the country’s export revenue. Accordingly, in 2010 Cobalt signed a contract in which it held a 40 percent stake in the venture and would be the operator. Sonangol, the state oil company, had 20 percent. The two local private companies, Nazaki Oil and Gáz and Alper Oil, were given 30 percent and 10 percent, respectively. What Cobalt had not revealed—indeed, what the company maintains it did not know—was that three of the most powerful men in Angola owned secret stakes in its partner, Nazaki Oil and Gáz. One of them was Manuel Vicente. As the boss of Sonangol at the time of Cobalt’s deal, he oversaw the award of oil concessions and the terms of the contracts. The other two concealed owners of Nazaki were scarcely less influential. Leopoldino Fragoso do Nascimento, a former general known as Dino, has interests from telecoms to oil trading. In 2010 he was appointed adviser to Nazaki’s third powerful owner, General Manuel Hélder Vieira Dias Júnior, better known as Kopelipa who as the head of the military bureau in the presidency, presides over security services that keep the Futungo protected by whatever means necessary. Delivering a suitcase stuffed with cash is only the simplest way to enrich local officials via oil and mining ventures run by foreign companies. A more sophisticated technique involves local companies, often with scant background in the resource industries. These companies are awarded a stake at the beginning of an oil and or mining project alongside the foreign corporations that will do the digging and the drilling. Sometimes genuine local businessmen own such companies. Sometimes, though, they are merely front companies whose owners are the very officials who influence or control the granting of rights to oil and mining prospects and who are seeking to turn that influence into a share of the profits. In the latter case the foreign oil or mining company risks falling foul of anticorruption laws at home. But often front companies’ ultimate owners are concealed behind layers of corporate secrecy. One reason why foreign resources companies conduct what is known as “due diligence” before embarking on investments abroad is to seek to establish who really owns their local partners. In some cases due diligence investigations amount, in the words of a former top banker, to “manufacturing deniability.” Cobalt’s lawyer said, “Success naturally brings with it many challenges. One of those challenges is responding to unfounded allegations.” The problem for Cobalt was that the allegations were not unfounded.

Excerpt from “The Looting Machine: Warlords, Oligarchs,Corporations, Smugglers, and the Theft of Africa’s Wealth” by Tom Burgis.

Angolan Austerity

With oil prices collapsing over 50 percent in the past six months, Angola -- Africa's second-largest oil producer -- has had to introduce austerity measures. Angola draws about 70 percent of its income from its oil resources. A price collapse, with supply outstripping demand, means a big revenue hit for the government.

"We will go through a difficult time now because the government cannot afford to implement the budget they had adopted for the year," said Jose de Oliviera, an independent consultant in the oil sector.

"There is a risk of even bigger problems, like being unable to pay the salaries of civil servants, or a drop in the quality and quantity of basic social services, which will affect the poorest the most," said Elias Isaac, director of the Open Society Foundation in Angola.
About 54 percent of Angolans live on less than two dollars a day.

 "Youth protest movements, which are viewed more and more favourably, are going to increase," said journalism professor and political analyst Celso Malavoloneke.

 Demonstrations have been held with increasing frequency in Angola since 2011 and are quickly repressed by the police. The young people behind these gatherings are demanding the resignation of Dos Santos -- already in power for 35 years -- while denouncing poverty, inequality, a lack of access to water and electricity, and failures in the health and education systems.

Oil addicts withdrawal symptoms

Falling oil prices are threatening several countries on the African continent.

 “The high debt overhang and the heavy reliance on raw materials (such as oil) and minerals for exports, makes African economies susceptible to shock and systematic risks,” Dr. Kwame Akonor, from the African Development Institute said. According to Akonor, the heaviest toll will be paid by Nigeria, the largest economy in Africa, which depends on oil for about 80 percent of its total revenues.

Algeria, Equatorial Guinea and Gabon will also suffer significantly from the plummeting oil prices, as these economies are also heavily dependent on oil revenues.

Ghana's president announced earlier this week that infrastructure plans could be scaled down due to the budgetary price of oil and the current fall. An article published by the Brookings Institutions shows that countries like Cameroon, South Sudan and Chad had drafted their budgets assuming record-high prices of over US$100 per barrel.

According to the Financial Times, conflict-stricken South Sudan is now receiving the lowest oil price in the world at US$20-25 a barrel because of the combination of falling prices and unfavorable pipeline contracts.

Several Western oil giants are halting ambitious exploration and exploitation projects throughout the region until oil prices recover.

The Ogoni Oil Protests

Oil and gas makes up 14% of Nigeria's GDP and Nigeria is Africa's biggest oil producer. Nigeria's oil production hit 2.3 million barrels per day in August 2014, the most since January 2006. An estimated $400 billion has gone missing from oil revenues in Nigeria over the last 50 years. 84% of Nigerians live on less than $2 a day.

The Ogoni ethnic group occupies about 1,000 square kilometres in the eastern Niger Delta region in southern Nigeria. Shell-BP, as it was then known, started oil extraction in Ogoniland in 1957, a year after it sunk its first Nigerian well in Ijawland.

In 2010 the Nigerian government asked the United Nations Environment Programme (UNEP) to carry out an independent assessment of the oil-polluted Ogoni environment. In August 2011 UNEP presented its devastating report, which detailed high levels of contamination throughout the area: ‘The Ogoni community is exposed to hydrocarbons every day through multiple routes. While the impact of individual contaminated land sites tends to be localized, air pollution related to oil-industry operations is all-pervasive and affecting the quality of life of close to one million people.’ After 50 years of oil pollution, UNEP called for ‘the world’s most wide-ranging and long-term oil clean-up exercise ever undertaken’. The $1-billion cost should be borne by the Nigerian government and the oil industry, UNEP declared. When the UNEP report was released in 2011 there was an international outcry. But the Ogoni people themselves were not surprised at its findings. As Rose Zaranen, an Ogoni leader, puts it: ‘The report only confirmed what we had always said. Now they have discovered for themselves that they have been poisoning our land and people. They should come and clean the land as UNEP has asked them to do. Since they don’t want to listen to us they should listen to UNEP.

 ‘Shell, in collusion with a succession of governments in Nigeria, is responsible for the human and environmental tragedy of the Ogoni people,’ says Bariara Kpalap, a leading Ogoni activist. “At the Human Rights Violation and Investigation Commission in 2000, Shell admitted that it was paying the military and sharing intelligence with them about Ogoniland and our people. With that false information, the military killed, maimed and raped in Ogoniland.”

A new wave of anger, manifesting in large protests, is sweeping through Nigeria’s Ogoni region over the refusal of the government to implement the UNEP report two years after it was released. The sense of frustration is articulated by Nnimmo Bassey, local NGO leader, prolific poet and writer, and former chair of Friends of the Earth International. ‘The UNEP report clearly attests to the decades of ecological aggression in Ogoniland. It is scandalous that no real action has been taken. Each passing day of delay places a death sentence on the people.’

‘The discovery that every part of Ogoni territory – water, land and air – is contaminated is terrifying,’ says Dr Nenibarini Zabbey, a hydro-biologist and co-ordinator of the local Centre for Environment, Human Rights and Development (CEHRD). ‘It is alarming to have recorded levels that high of BTEX [benzene, toluene, ethylbenzene and xylenes] in the groundwater people have been relying on over the years. The concentration is about 900 times above the permissible limit set by the World Health Organization.’ This may help explain why life expectancy in the Niger Delta is just 45 years.

In July 2012 the government half-heartedly responded, and set up the Hydrocarbon Pollution Restoration Project. Unfortunately, the project is part of the Petroleum Resources Ministry, not the Environment Ministry. Since its formation, its greatest achievement has been putting up warning billboards on polluted sites in Ogoniland, saying: ‘Public notice – prohibition! Contamination area – keep off.’

The clean-up is not just the government’s responsibility, however. Activists are also directing their calls for implementation at Shell, which is responsible for thousands of the spills that are still poisoning the Ogoni people’s land and water today. On 28 August 2008, a new tragedy struck. A fault in the pipeline resulted in a significant oil spill into Bodo Creek in Ogoniland. Shell – now known in Nigeria as Shell Petroleum Development Company (SPDC) – repaired its facility the following November, but didn’t clean up the spill. Oil poured into the swamp and creek for weeks, covering the area in a thick slick and killing the fish that people depend on for their food and livelihood. 2009 saw a second spill. Faced with overwhelming evidence that the pipeline had not been adequately protected or repaired, Shell has been ruled liable for the impacts of the spill – a ground-breaking legal decision that could open the floodgates to other similar cases. The company has offered to pay $51 million to settle, which the Bodo lawyers described as ‘insulting’: it would not remotely cover the costs of what the community members have lost.

From here

Development Or Fraud? Another Coastal Paradise To Die For Big Oil

A new 32 berth port, to ship South Sudanese oil to China, is planned for the Lamu archipelago, a stunning green field heritage site in northern coastal Kenya, teeming with rare species, coral reefs and marine biodiversity and, of course, people. But none of this richness, or the indigenous people for whom this is home, seem to matter to the Government of Kenya and private developers.

In April 2013 the Kenya government granted a $484 million contract to a Chinese firm to put up the first three berths for the new Lamu Port in the first phase implementation process of the project. This followed the uprooting of prime mangrove trees in February, to pave the way for the construction of the first three berths and port administration office at Kilalana, a clearance that is nearly complete. The land was created from the felling of mangrove trees, comprising 30% of tree cover in Kenya.

 However, the developers and their government cronies paid scant regard to an environmental impact assessment, while those who lost their land are still waiting for compensation a year later. Indeed, only fraudsters are getting rich, while the port development has already made thousands of families destitute and hungry. With another 100,000 people potentially in the way of the gigantic development, the first phase portends badly for the rest of the development, since neither project affected persons nor the natural capital and biodiversity have been give the respect they are due by right, and by international law and convention.


Read the full, detailed article here

Land Grab in Madagascar

When a Chinese businessman first approached Malagasy farmer Jean Manantsoa, last year with an offer to lease his family rice fields, Manantsoa had no idea of the untapped pockets of potential natural wealth beneath.
"It was a surprise that there was gas beneath my land. Before we thought this was a wonderful thing," says Jean Manantsoa, remembering when he was first told of the riches beneath his rice.
But since I gave it to the Chinese it has been a disaster."

Feeling pressured by the representative of the company, Madagascar Southern Petroleum Company (MSPC), Jean signed an open-ended lease for five million Malagasy ariary a year (£1,420). He received the first year's payment but nothing this year even eight months after the 1 April deadline. Jean now claims his paddies are ruined; a metal drilling bore and concrete slab sits on his rice field and the surrounding brown earth is churned into dry clods.

An investigation by the Forum for African Investigative Reporting (FAIR) has found a Chinese company in Madagascar, with strong links to the government, is accused of unlawfully acquiring land, blighting the environment and leaving farmers destitute. In previously unpublished documents, Madagascar's National Environment Office, ONE (office national pour l'environnement), slams MSPC, owned by one of China and Madagascar's most powerful mining billionaires, Dr Hui Chi Ming. Hui is currently Madagascar's consul in Hong Kong and advises the prime minister and president on economic and Asian affairs. "He's the top of the top", says one Malagasy official who dined at Hui's Hong Kong residence close to when the philanthropist and billionaire appeared on Forbes's 2009 "400 Richest Chinese List" with an estimated wealth of $815 million.

Hui's MSPC is a subsidiary of Hoifu Energy Limited recently announced plans to increase profits through growing "the portion of oil and gas businesses". Neil Bush, the 58 year-old brother of former U.S. president George W. Bush, is one of eight directors.

Madagascar is a resource-rich country but the island's oil and gas wealth has been largely unexplored and extractive industries made up just 0.53% of GDP in 2011, the last assessed year by the Extractive Industries Transparency Initiative.

At the turn of the century, officials granted 20 onshore blocks on the country's west coast to a handful of Chinese, British, Australian, American, Indian and Malagasy companies.
Among them was MSPC, which scooped up a 9,260 square kilometer plot — larger than Devon and Cornwall combined — known as Block 3112. Eight years on, Block 3112 is promising and should start producing gas in 2017, according to Hery Zaka Razafindrakoto, the deputy head of petroleum at Madagascar's oil and gas regulator, OMNIS. But since July 2012, the ONE has visited MSPC's Mahaboboka site and questioned the company about what the government regulator identified as "grave failures committed by MSPC with regard to environmental legislation in force." One experienced government official says: "The worksite, from an environmental perspective, was a dump. It was in the worst condition that I had ever seen."


"The Chinese lied to the villagers," says Mahababoboka's Mayor Emile Rakotondravelo from his second-floor office, a concrete building where broken green lino covers the floor.
"The company said that I had already agreed to sign the contracts," something the mayor denies. Without the mayor's consent and signatures, the contracts are invalid under Malagasy law.
"I told them I wanted to legalise the contract before the Mayor," says Manantsoa. "But the company said they had already had discussions with the mayor and gotten his approval."
Accusations of land grabbing in Madagascar are not new. But ONE's response to MSPC is rare, according to insiders, reflecting the increased attention to foreign ownership of the country's natural resources.

"Land and resource grabbing in Madagascar is far from experiencing a downward trend," says Giulia Franchi, land campaigner with the Italian NGO Re:common. "Whether this happens through lease or sale contracts, the actual results for local communities is the same: their land is being grabbed and they lose any possibility to sustain themselves."

Despite MSPC submitting a document confirming it owns no land in the Mahaboboka area "The Chinese bought land through a female employee," claims another official with detailed knowledge of the case. Land registry documents show the purchaser of 74.48 acres and 2.1 hectares at Ankida is Ms Brigitte Monique Andrianifahanana, manager of Gold (Grand Investment Limited). Hui holds 21.98% of shares in a company that last year increased its stake in Gold Grand to 40%. Andrainifahanana is an employee of Hui's company Banque Industrielle et Comerciale de Madagascar and denies any link between Hui and her purchase.

From here 

New Countries, Old Hopes

Somaliland declared its independence from Somalia in 1991, calls itself a sovereign nation, and operates as such, but has not been recognized by any other country in the world. and has been largely forgotten. Somaliland has a working government -- something that's markedly lacking in Somalia. Somaliland, a region with a population of 4 million islocated in Somalia's northwest bordering Ethiopia, Djibouti and Puntland (another unrecognised autonomous region). Somaliland has its own government, constitution, currency and economic ambitions. Since it isn't formally recognized as an independent state, the territory can't receive direct aid from international donors. (Tens of millions of dollars do filter in annually to combat endemic poverty and food shortages, though the funds are administered by aid agencies and aren't recorded in government books.)

Led by President Ahmed Mahamoud Silanyo since 2010, Somaliland is promoting itself as a safer destination for investors than the nearly-lawless Somalia. ighly dependent on transport customs and domestic taxes, which many analysts argue has actually stabilized the region by keeping government authorities beholden to citizens and private businesses.  Meanwhile, remittances from abroad have grown indispensable to citizens, since there are no commercial banks in Somaliland.

It might find itself at the center of an international scramble for the next oil hotspot.  Given its geology, he says, the region could hold several oil fields with reserves in the billions of barrels. In 1991, with Somalia on the verge of civil war, a World Bank/UNDP study noted that the northern part of the country was likely to contain significant hydrocarbon prospects. But as the central government dissolved in a spiral of violence, prospects for exploration vanished.  Somalia’s government -- whose authority does not extend much beyond Mogadishu, 500 miles (800 km) away by air -- does not recognize the government of Somaliland, and has discouraged oil companies from doing any business with it.

Minister of Energy and Minerals Hussein Abdi Dualeh expects three or four international oil companies to begin 2D seismic evaluation exploration projects in Somaliland next year. He will also be developing a separate military force fully trained and equipped and tasked with protecting the oil industry which will have a separate command structure from the other armed forces of Somaliland. His sales pitch is that East Africa is currently the go-to region for oil exploration in Africa. It has the potential to become the new Middle East and unlike some of the inland places in Africa where oil is being found, the possible oil-fields here very close to the coast, where oil can be shipped easily to world markets.

Berbera, the country’s the port city,  hopes to tap into Ethiopia's relative wealth by turning Berbera into a similar hub as Djibouti. Some Ethiopian trade already flows through the city, and total revenues from the port generate up to 80 percent of Somaliland's annual budget, which is at an all-time high of $125 million this year. But the government is keen to rake in even more. The demand is there; maritime traffic often overwhelms the Djibouti port, as it does at nearby ports like Mombasa, Kenya and Dar es Salaam, Tanzania.

From here

To Hell with Shell

Niger delta communities devastated by giant oil spills from rusting Shell pipelines have unanimously rejected a compensation offer from the company, calling it an insult, and cruel and derisory. A court in London is now likely to decide how much the Anglo-Dutch firm should pay 11,000 fishermen and others from the Bodo community who lost their livelihoods when the 50-year-old Shell-operated trans-Niger pipeline burst twice within a few months in 2008.

Chief Patrick Porobunu, leader of a Bodo fishing community, said: "Shell is cruel, very wicked. It has given us nothing again. People here are very angry. All we have is poverty because of Shell. We have no electricity, no health. Our suffering goes on."

Estimates of how much oil was spilled ranged from around 4,000 barrels to more than 300,000. Communities this week reported that no cleanup had been done and that water wells were still polluted. Five years after the spills the creeks and waterways around Bodo have an apocalyptic feel. The air stinks of crude, long slicks of oil drift in and out of the blackened, dying mangrove swamps and a sheen of oil covers the tidal mudflats. "It's everywhere. The wind blows the oil on our vegetable crops, our food tastes of oil, our children are sick and we get skin rashes. Life here has stopped," said Barilido,

Shell offered the communities £30m, or around £1,100 for each person affected. Martyn Day, a partner with the UK law firm Leigh Day who represented the those communities, said Shell's offer was rejected unanimously at a large public meeting in Bodo. "The amount offered for most claimants equated to two to three years' net lost earnings whereas the Bodo creek has already been out of action for five years and it may well be another 20-25 before it is up and running properly again. I was not at all surprised to see the community walk out of the talks once they heard what Shell were offering."

It emerged that Shell had offered the communities only £4,000 shortly after the two spills occurred in 2008-9. "Shell continue to treat the people of Bodo with the same contempt as they did from the start when they tried in 2009 to buy us off by offering the community the total sum of £4,000 to settle the claims," said Chief Kogbara, chairman of the Bodo council .

Chief Tal Kottee, Bodo elected regent, said: "We had been expecting a good settlement from Shell. Our livelihoods here have been totally destroyed. It's an outrage that it has taken so long for a cleanup and to get compensation."

Shell is the largest firm on the London stock exchange with a market capitalisation of £141bn, for what they called its "meanness". They accused Shell of financial racism and applying different standards to cleanups in Nigeria compared with the rest of the world.

"Is it because we are Nigerian and poor that they offer so little for the damage they have caused?" said one fisherman at the Bodo meeting.

"It is a big shame on Shell that they are unwilling to pay a fraction of their profit as compensation after subjecting the people and the environment to such unthinkable harm they would not dare allow in their home country," said the Nigerian environmentalist and chair of Oilwatch International, Nnimmo Bassey.

A Tangled Web For Resource Control In Sudan

No apologies for posting the whole of this article from a Tanzanian freelance journalist and writer. Each section is inseparably linked and important for grasping the intricacies of the situation. JS

from Countercurrents.org

Sources say the peacekeepers are struggling with equipment problems, poor training of some contingents and the reluctance by some governments to send their soldiers into combat zones. When seven Tanzanian peacekeepers in Darfur, western Sudan, were killed and 17 seriously wounded in an ambush by gunmen, the incident sent shockwaves throughout the country. For the first time public was made aware that all was not well with their men and women deployed in the war-torn Sudan as part of the UN peacekeeping forces. The deadly attack on 13 July this year occurred when the soldiers were in a convoy searching for their vehicles that were reportedly stolen by a rebel group. The Tanzanian soldiers sustained heavy fire from machine guns and possibly rocket-propelled grenades. Among the wounded were two female police officers. No group immediately claimed responsibility. But a UN report in February said that some armed opposition groups are angry about the presence of peacekeepers and have called the force ‘a legitimate target.’

In the Tanzanian official circles scanty information was released, but some local journalists contacted the peace-keepers in Darfur. One of them said, on condition of anonymity, that a week ago unknown assailants attacked members of the army and disappeared with four vehicles. ‘It is really traumatising here; I can tell you the rebels are fully armed with sophisticated weapons,’ he lamented.

Immediately, questions were raised about the United Nations African Mission in Darfur (UNAMID) whose task is to maintain peace and protect civilians from insurgents. Some asked if there was any peace to maintain in the first place.

The Tanzanian contingent of 875 military and police personnel has been stationed in Darfur for some five years as part of the UNAMID, which has strength of 16,500 troops and military observers plus 5,000 international police. Yet the latest casualty was not an isolated encounter by the solders on peace mission in Darfur.

Peacekeepers have been targeted at various times since the international force began its work in the region in 2008. In April this year gunmen shot and killed a Nigerian peacekeeper. Prior to the July attack, 150 people associated with the UN mission in Darfur had been killed while on duty in the region, according to the force's website. Following the latest attack, Tanzania is now seeking a stronger mandate for peacekeepers in the Sudan's strife-torn Darfur region, so as to ‘deal with the current condition.’ The demand is to equip the peacekeepers with heavy weapons such as APC, artillery and helicopters. Army spokesman Colonel Mgawe said, ‘We want our troops to have more capacity to defend themselves against insurgents’. He said currently their rules of engagement, under Chapter 6, forbid the use of ‘excessive’ force. Now they are going to negotiate with UN for Chapter 7 so as to give the troops more fire-power to defend themselves. That means use of heavy weapons as is the case with Tanzanian forces in DRC. In fact some Tanzanians have questioned why give them heavy weapons in DRC and not in Darfur. Whether, with such armaments, they have succeeded in wiping out M23 is another question. 

The pertinent question for Darfur, however, is whether the peacekeepers there are now going to pursue the rebels and fight them on their turf or are they going to fight back when attacked. If it is the former then actually it means there is no peace to maintain and so stationing peace-keepers there is paradoxical

It has been suggested that the better solution for stopping the attack on peacekeepers would be to cut off the supply line of heavy weaponry to the rebels, especially if the supply comes from outside the Sudan.

Meanwhile, Tanzanian President Jakaya Kikwete has asked President Omar al-Bashir to investigate the latest incident and ensure that the perpetrators are apprehended and brought to justice.The question is whether Bashir has the ability to take any action, since he himself has been under attack by the rebels. After having negotiated and signed peace treaty with them, not all have joined the cease-fire. And so his troops have been under attack from time to time. Hence he is hardly in control of the situation in Darfur, which has been described as a civil war. Darfur has over 35 tribes and ethnic groups. Half the people are small subsistence farmers, the other half being nomadic herders. For centuries the nomadic people have been grazing their cattle and camels over sprawling grass lands, sharing water sources. 

The crisis is reportedly rooted in intertribal feuds over increasingly scarce water and grazing grounds in the area hit hard by years of climate change, drought and growing famine, coupled with the encroaching Sahara Desert. The matter became worse when local tribes took up arms in 2003 against the government in Khartoum, which they accuse of marginalising them. Meanwhile, more insurgencies were launched from Darfur. Factions allied with or against neighbouring countries operated from bases inside Darfur, which became a regular landing ground for foreign military transport planes. Thus, Chad’s Idriss Deby launched a military bombardment from the neighbouring Darfur and overthrew President Hissan Habre. French and U.S. forces were then involved in funding, training and equipping Deby, a military ruler, who supported the rebel groups in Darfur. At the same time there were reports of Israelis providing military training to Darfur rebels from bases in Eritrea, while strengthening ties with the regime in Chad, from where more weapons and troops penetrated Darfur. Refugee camps were thus militarized. 

 Darfur was further militarised when the regime of Ange-Félix Patassé collapsed in the Central African Republic and his soldiers fled to Darfur with their military hardware. The situation was not made better when, in August 1998, US President Bill Clinton ordered missile attack on the El Shifa pharmaceutical plant in Sudan. It was producing cheap medications for malaria and tuberculosis, supplying most of the medicine in Sudan. The plant was completely smashed by 19 cruise missiles, for no logical reason. And so Darfur became the hub of international geopolitical scramble for Africa’s resources. The region has the third largest copper and the fourth largest high quality uranium deposits in the world. It produces two-thirds of the world’s best quality gum Arabic, which is major ingredient in cold drinks, pharmaceuticals and candies. Sudan exports 80% of the world’s supply of this commodity.

The country, the largest in Africa in terms of area, is strategically located on the Red Sea, immediately south of Egypt, and borders on seven other African countries. It is situated opposite Saudi Arabia and the Gulf States, among the main suppliers of oil. Sudan also has abundance of natural gas and oil, much of it in Darfur. The problem for the West is that it is the Chinese who are pumping the oil. U.S. companies controlling the pipelines in Chad and Uganda are looking for the ways to displace China through the US military alliance with states such as Uganda, Chad and Ethiopia, which are not too friendly with Sudan. Darfur, a western region of Sudan, borders on Libya and Chad, with their own vast oil resources. So it is a likely pipeline route. 

The West is thus pushing for ‘peacekeeping’ mission in Darfur in order to pursue its own agenda. That is why in the end the whole exercise may result into another Iraq or Afghanistan. This is because the United States and its allies look for conflicts, or even provoke conflicts, which they use as pretext to intervene in other countries, militarily or otherwise, directly or through proxies (including the UN). The aim is to exploit and control these countries economically and politically through puppet governments. This way they facilitate, promote and protect the investments of their corporations. This is how the United States and other western powers are working towards political domination in Africa and elsewhere, in order to exploit their resources. 

These are the sentiments that were possibly expressed by chairman of Tanzania’s National League for Democracy (NLD), Dr. Emmanuel Makaidi, when he called upon the government to withdraw Tanzanian peace-keeping troops from Sudan as their presence there is ‘not in the country’s national interest. It is not worth sacrificing our seven soldiers who lost their lives in an ambush laid by insurgents,’ he swiped, adding that Tanzania has an ill-advised foreign policy.

Nizar Visram is a Tanzanian freelance journalist and writer on political and socio-economic issues. He can be contacted at nizar1941@gmail.com

BP Profits

Angola is one of BP’s four most lucrative “high-margin” regions that contribute a disproportionately high share of its profits. Generous contracts give BP an operating cashflow margin in Angola of almost $60 a barrel, according to Deutsche Bank – more than double BP’s global average. After costs, BP can expect about $40 profit for each barrel it produces in Angola, compared with as little as $1 elsewhere.


Angola is Africa’s second biggest oil producer, with oil accounting for about three-quarters of government revenues. But, as the US Energy Information Administration notes, “much of the oil wealth in the country does not find its way to the average citizen”.

36% of the population live below the poverty line and a short distance from BP’s offices in Luanda, barefooted children pick through mountains of rubbish in the slums. Angola consistently ranks as one of the world’s most corrupt countries

Why Are Sudans at War?

Formerly a single country, Sudan has split in to two states.

It all looked so good just over a year ago. the Republic of Sudan's President, Omar el-Beshir, had visited South Sudan's capital Juba and promised to welcome and recognise a vote for secession, if this was, "the price of peace." Indeed, Bashir kept his promise and attended the independence celebrations and was the first to recognize the new state of South Sudan.

Today, however, the two countries are at war, in the border area of Heglig, as well as by proxy in Southern Kordofan and Blue Nile, and increasingly in the borderlands of South Sudan as well. Heglig oil wells may account for as much as 80,000 barrels per day of Sudan's 120,000-130,000 bpd output. Khartoum cannot afford to lose this. It simply does not have the foreign currency reserves to keep importing fuel to make up the gap, and there are fears the prices of basic good could rise.

Sudan's government has ordered its civil servants to donate part of their salaries to support the army, according to the official state news agency. Sudan's finance minister Ali Mahmud al-Rasul has also cut the petrol rations of government departments by 50%. Analysts say the measures are a sign that Sudan's economy has been badly hit, both by the loss of revenue from when South Sudan became independent last year, and by the recent clashes between the two nations.

While the decision by South Sudan to shut down oil production in January - 98% of government revenue - after Sudan impounded South Sudan's oil shipments amid a dispute over transit fees - its effects are being felt. There is the beginnings of a fuel crisis in Juba, and infrastructure projects and development are on hold.

 An all-out war would create great misery for all peoples, as all wars always do.

http://www.bbc.co.uk/news/world-africa-17853074

The Oil Curse in Uganda

In 50s, some economists suggested that natural resource-abundance would help the backward States to overcome their capital shortfalls and provide revenues for their governments to provide public goods and lift citizens out of the doldrums of poverty. However, since then, a growing number of researches have established a link between resource-abundance and a number of social and economic problems. Natural resource-abundance has been associated with slow growth, greater inequality and poverty for a larger majority of a country’s population, corruption of political institutions, and more fundamentally, an increased risk of civil conflict. At the same time, there is an established link between resource motivated conflict and economic collapse. Of all natural resources, oil has been found to have the highest risk. 23% of states dependent on oil exports have experienced civil war in any 5-year period, a figure that dwarfs the 0.55% for countries without natural resources.

Recently oil has been discovered in Uganda. Oil experts estimate Uganda’s Albertine Basin has at least two billion and as many as six billion barrels of recoverable oil, positioning Uganda to become one of sub-Saharan Africa’s top oil producers and potentially doubling current government revenues within 10 years. The resource could become Uganda’s curse rather than a blessing. In Uganda the agriculture and fishing sectors provide approximately 80% of employment. Uganda is Africa's second-leading producer of coffee, which accounted for about 23% of the country's exports in 2007-2008 and 17.9% in 2009. Exports of nontraditional products, including apparel, hides, skins, vanilla, vegetables, fruits, cut flowers, and fish, are growing, while traditional exports such as cotton, tea, and tobacco continue to be mainstays. Most industry is related to agriculture.

Most of Uganda’s known oil reserves are located along Lake Albert and the D.R.C. border, in one of Africa’s most ecologically sensitive areas. Wildlife based tourism and scenery dominates Uganda’s hospitality industry with more than 70% of the visitors coming to the Albertine rift. Incidents of land grabbing and migration towards oil sites are already taking place. Many multinational companies backed by their foreign “interest”, are already scrambling for oil exploration in Uganda. Lukoil, for example is Russia’s largest oil company, and the second largest private oil company worldwide by proven hydrocarbon reserves, with about 1.1 per cent global oil reserves, and 2.3 per cent of global oil production. Interesting question to ask; what are the implication of this to “little” Uganda? The same oil will be sold back to Uganda at a higher cost and additionally employment opportunity will be limited since most of its exploration and production activity is located in Russia. The higher costs of fuel are then reflected in the hiking costs in transport sector which in turn is shifted to the public in terms of high commodity prices, and the costs of environmental management (Pollution) should be noted.

it’s important to acknowledge that the existing conflicts are real and that small conflicts may escalate. This is true with the current conflicts in Uganda. The conflicts include: scrambling over land, multinational companies scrambling over oil exploration licenses, and associated consequences like corruption, contracting a monopoly or medium firm which may use sub-standard materials, political tensions which may explode into violence and creating ethnic and cultural differences, propaganda, migration of wildlife, and environmental threats such as clearing forests, digging of trench during survey.

From here

Oil Pollutes Nigeria

Oil was first drilled commercially in Africa in Oloibiri in the Niger Delta, in 1956 by the Anglo-Dutch oil giant Shell. The International Energy Agency says Nigeria holds 37 billion barrels of reserve oil (Norway which has just 6 billion.) Despite its oil wealth, Nigeria has to import 60% of its own fuel because of a lack of domestic refining capacity and power blackouts are common.

Nigeria's Ogoniland region could take 30 years to recover fully from the damage caused by years of oil spills, a long-awaited UN report says. Ogoni communities have long complained about the damage to their communities, but they say they have mostly been ignored. Communities faced a severe health risk, with some families drinking water with high levels of carcinogens. The study says complete restoration could entail the world's "most wide-ranging and long-term oil clean-up".

"In at least 10 Ogoni communities where drinking water is contaminated with high levels of hydrocarbons, public health is seriously threatened," the UN Environmental Programme. Some areas which appeared unaffected were actually "severely contaminated" underground. In one community families were drinking from wells which were contaminated with benzene, a known carcinogen, at 900 times recommended levels.

Shell has accepted liability for two spills. The report, based on examinations of some 200 locations over 14 months, said Shell had created public health and safety issues by failing to apply its own procedures in the control and maintenance of oilfield infrastructure. The oil industry is accused of a sharp double standard in its operations - of taking advantage of Nigeria's lack of environment law and weak regulation. According to the Nigerian government, there were more than 7,000 spills between 1970 and 2000. Environmentalists believe spills - large and small - happen at a rate of 300 every year. Says Kingsley Ogundu Chinda, environment commissioner in Rivers State,"I blame the owners of the facilities. They are economical with the truth. They are not sincere in their practice. They are not sincere with the people."

Amnesty International, which has campaigned on the issue, said the report proved Shell was responsible for the pollution. "This report proves Shell has had a terrible impact in Nigeria, but has got away with denying it for decades, falsely claiming they work to best international standards," said Audrey Gaughran, Amnesty's global issues director, said.

70% of Nigerians live under the poverty line and the country has consistently been ranked among the most corrupt on earth by international observers.

Angola and corruption

Calculations provided by the Washington-based anti-corruption advocacy group Global Financial Integrity (GFI) suggest funds worth nearly a sixth of Angola's entire annual budget - $6 billion US - flowed illicitly out of the country .

The bulk of the flows was channelled abroad by a mechanism known as "trade mispricing." In this case, the way it typically works is that Angolan importers pretend to pay foreigners more for imports than they actually spend. The difference provides cash that can be discreetly put into banks or other assets abroad. Oil producers seem especially susceptible to this and other kinds of corruption and capital flight. Angola is Africa's largest oil producer after Nigeria and a strategic supplier of crude to the United States. Because of the role of trade mispricing, the figures also highlight the extent of commercial graft, which exacerbates the persistent problem of capital flight and hampers the country's chances of attracting non-oil foreign investment. The GFI calculations suggest an unaccounted $5.8 billion left Angola in 2009 -$4.6 billion through trade mispricing, and the rest probably via official corruption or criminal activities traced through balance of payments data.

The secretive governing elite at the top of the ruling MPLA party has long been accused of graft on a grand scale and of plundering the oil wealth of a nation where the vast majority of its 18.5 million inhabitants live in squalor and poverty.There is a tight oligarchy around President Jose Eduardo dos Santos, who has been in that office since 1979, making him one of Africa's longest-serving leaders.

On Transparency International's latest Corruption Perceptions Index, Angola ranked 168th out of 178 countries. And though most residents of the capital are all but destitute, more than one consulting firm ranks Luanda the world's dearest destination for foreigners.

GFI estimated that in 2009 $27.5 billion flowed illicitly out of Nigeria, Africa's largest oil producer and a country with eight times Angola's 18.5 million population.

As socialists we would like to say that the existence of corruption or how much there is of it in governments is not important to the working class. What is important is why it exists and the answer is because it is an inevitable part of capitalist society. Social inequality, poverty beside riches will guarantee its continued existence.

Troubled Water - book review

Crude World. By Peter Maass.
The delta of the River Niger is an enormous wetland, once a flourishing ecosystem with a wide range of life forms. But now it is not a wildlife sanctuary: rather it is a horrendous landscape of ruined villages, devastated populations and roving armies. The reason for this is simply the delta’s vast oil reserves and the prospects for wealth and power that these entail.

This is but one clear example of the ‘resource curse’, which states that countries dependent on the export of resources such as oil are susceptible to more corruption and warfare but less freedom or economic growth. In this enlightening book, Peter Maass surveys a number of cases and shows how oil rarely produces benefits for those who live in the places where it is found.

In Equatorial Guinea, for instance, the discovery of offshore oil led to enormous riches for the dictator-president Teodoro Obiang. Few local workers were employed in the exploring and drilling work, and massive profits were made by American companies like Exxon. The US government, and various lobbying groups, played their part in supporting Obiang and keeping him friendly to American business. This is particularly important as Chinese companies start flexing their own oil-producing muscles.

In Ecuador Texaco was able to do more or less as it wished, since the officials of the newly-formed state oil company knew next to nothing about oil. The natural gas that came to the surface with the oil was just burned off, which can be deadly for both people and environment. Rivers and land have been contaminated and the government left with massive debts.

The profits, of course, go to the oil companies and their owners. Lee Raymond received $686 million for his thirteen years as chief executive of Exxon-Mobil, while billions went to share-holders. As Maass points out, oil companies in fact do not ‘produce’ oil, they simply take it from the ground. Extracting, purifying and transporting oil are complex tasks (performed by skilled workers), but selling oil to realise the profits is not difficult. What is needed in the first place is a licence from the local government to explore and extract oil, which is why the oil industry is usually rife with corruption and works closely with diplomats and generals to ensure this kind of access.

So a substance used to provide fuel and warmth also causes wars and destroys the environment. Inevitable consequences of a world that belongs to a privileged few and is driven by profit.

PB