Pertinent Questions Regarding East Africa’s Oil and Gas Rush

Filed under: Business,Featured |
East Africa Oil gas photo

East Africa has seen a flurry of exploration activity

In July this year the China-Africa Ministerial Conference in Beijing took place. Forty-nine African countries and China agreed the fortunes of oil and natural gas extraction in Africa.

During the conference it was decided that there was a need to outline environmental objectives, regulatory frameworks and green guidelines for extraction and development. Serious aficionados, however, would have been wondering about what fate was decided for communities – the actual people that live in these areas. Any attention, such as there has been, is mainly on the projected gains from valuable resources. Local media bulges with Spartan press releases parroting obscure rhetoric more suited to the oil and gas exploration trade press.

Questions, such as the following, are markedly absent from public debate: Where is exploration taking place? How many people are affected? How many natural parks, gazetted areas, or conservancies will be mined in? How are communities being consulted? What are the projected profits? How will these be spread out? What facilities for communities (hospitals, schools, roads and local business support) will be built where the rigs are? What are the mechanisms for keeping track of the money? What about offshore investments, who will be monitoring or policing the gains? How will national governments address their already faulty taxation systems, and make public their regional spending priorities?

Such is the obfuscation, lack of media coverage and critical analysis from ‘civil society’, that the effects of oil and gas on local communities have been forgotten. Or perhaps they are they being deliberately ignored.

The agenda of concerned NGOs (who, behind the scenes, have been lobbying for ‘no go zones’ for extraction purposes, and a much more rigorous and thorough approach to governance issues) are not in the public eye. Dr. Li Lin, Deputy Country Representative at WWF China says “Investing in sustainability is fundamental for both Africa and China’s long-term prosperity. It is in both China and Africa’s interests that high governance standards are part of the aid, trade and investment portfolio of China in Africa, positively influencing China’s footprint in the continent.” But where are the equivalent of ‘planning gains’ or community consultations, informal or not, when it comes to governance?

The wider the gap between those making decisions, and those affected by them, the greater the potential for misunderstandings and problems. Missing in East Africa are the discussions, editorials, phone-ins, investigative programmes, outrage, curiosity or involvement from the communities in the areas that will be affected by drilling for oil and natural gas. In Tanzania, where I have lived and followed this story for 5 years, there is a marked absence of information. From interested expats, to informed regional environmental consultants, to oil rig workers, people in the villlages on the coast and inland. No one really knows what’s going on.

The areas potentially affected by natural gas and oil exploration are manifold and massive. Ranging from Somaliland in the North, through Uganda and DRC, and right down to Mozambique (and encompassing Madagascar, the coasts of Kenya and Tanzania) these are some of the most biologically rich, environmentally complicated areas in the world. In the Albertine Basin in Uganda (already flagged up by the World Resources Institute as an area of potential conflict for water and fishing resources) the media talk is on Tullow Oil’s success at renegotiating access, not of the Ugandan government’s alleged displacement of the Acholi people there. There are also few existing baseline surveys about the environmental vulnerabilities and perils. What is categorically missing are information networks (for both gaining and dispersing information) and co-ordinated data about the people living in these areas.

Oil is currently a tantalising dream in the East Africa region. However, as anyone who’s spent more than two weeks by the pool in Africa knows, most of the real stuff goes on via pavement politics. In bars, markets, mutatos, Daladalas or Chapas. It is from such places, plus a few opportune evenings hanging out with the Dutch, English and French working on the rigs in Mtwara and Songo Songo (both in Southern Tanzania) that the full complexity of the issues unfurl.

The riggers agree that oil is definitely there. So do the environmental biologists and directors of larger NGOs. Currently, disgruntled people living in southern Tanzania complain that they aren’t getting any work from the natural gas exploration. There are hiked property prices for the incoming workers, and an increased incidence of pole dancing clubs in Mtwara – not the sort of sustainable economic opportunity local people were hoping for. In Kilwa there is now electrification (due to natural gas) but confusion about why no jobs have materialised. In Dar Es Salaam, logistics companies (supplying cars, hospitality, security) are doing rather well, as security issues for vulnerable (and expensive) kit and people need to be addressed. Young and old Tanzanians, with little English, and still waiting for cashew and sesame payments from national government in Dar Es Salaam, are both frustrated and currently not organised. With anecdotal evidence of 80 percent unemployment, they have no way to say to Andarko, Petrobas and BG Gas (the three biggest players currently in the area) what they want, and to go through the slow process of community consultation.

Concerned academics, Directors of NGOs (who by and large actively stress their desire to stay out of the limelight) environmental consultants, and local community leaders, are following the LAPSSET ‘development’ of the historic Kenyan port at Lamu, the East/West Serengeti Highway, and the threats to specific species in the Coastal regions. Debate is however piecemeal. Attention has tended to focus on the environmental issues. Resource analysts focus on geology or engineering, rather than examine the more complex social impacts of exploration. The emphasis is on environmental damage. However, financial systems or modelling cannot ‘bail out’ oil companies in the same way they can in other areas, as the risks of piracy, and civil conflict are too great in the areas concerned. They have no risk plans at all for local communities, who are not considered an economic asset.

This is not to suggest that gas and oil extraction is, de facto, a bad thing. But the debates that do occur take place in niche trade journals – indicative of the parochial nature of this region, and the complexity of the issues. Governance is about how roads service communities not just the oil transporters. Governance is about asking which hospitals and schools get built alongside the the refineries. What percentage of the profits go back to the communities. If and how fishing livelihoods will be affected. Whether people understand the risk assessments and safety nets in place.

Oil companies must show the public what they are doing, how the profits are distributed, and how many sustainable job plans are to be put in place. As Rakesh Rajani, director of Twaweza – a Tanzanian media-focused NGO – comments: “Tanzania has undertaken a significant number of anti-corruption activities including an elaborate anti-corruption agency that has produced a strategy and plan, more investigations, and more cases in court. Yet the overwhelming feeling among citizens and experts alike is that Tanzania is losing the battle against corruption. In my view the most important reason for this is the lack of transparency.”

Rajani makes vital points: that in the planning of oil and natural gas exploration, vital components of governance are missing. East African governments would do well to follow the examples of Brazil (hospitals) or the Phillipines (schools, www.checkmyschool.org) who release information in real time, disaggregated, so it’s meaningful and understandable to ordinary citizens, and using new technologies to display and transmit data, particularly via the internet and the mobile phone. This creates practical and safe opportunities for citizens to give tips, ideas, feedback and whistle-blow in a manner that is constructive.

Of all of these, perhaps the most important is the management of extractives. Rajani says: “Making every aspect of gas transparent — reserves, contracts, taxation, transfer pricing, accounts, environmental assessments, governance structures, etc — could enable the country to reap real benefits and to achieve key goals for present and future generations; whether we do so is uncertain but there are no signs yet to suggest that we have leadership, public pressure and imagination to get this right”.

 

By; Thembi Mutch