Monday, October 11, 2004

Anger wells on Nigeria's oil fields

Anger wells on Nigeria's oil fields

THE nearest village to Oloibiri, the well where oil first bubbled up in Nigeria 43 years ago, is called Otuagidi. To get there, you must travel deep into the Niger delta, first on a rutted track, then paddling in a dug-out canoe.

On arrival, you find scruffy huts clustered on the edge of a creek surrounded by forest. The village survives on barter - trading fish for vegetables with a nearby village, much as it did when European traders came for palm oil and slaves 200 years ago. With one difference: in those days Africans controlled the trade; now the people control nothing of value.

They know oil worth billions of dollars flows from under their feet but they get nothing from it.

They are angry. "I was at Oloibiri on March 15 1956 and we celebrated when the first oil came," says Ralph Fabray, Otuagidi's chief. "We were expecting we would be in paradise, but we have never benefited from the oil." He calls the oil companies and the government "a syndicate of criminals" and blames them equally for the region's poverty.

Discontent among the people of the delta goes back more than 30 years. Anger came to a head when Ken Saro-Wiwa, a leader of the Ogoni people, was executed in 1995.

Since then, other groups have attacked Royal Dutch/Shell's oil operations. At the end of last year, Ijaw activists shut down 20 pumping stations; last week five people were killed at a jetty that militants were trying to close. In December, Ijaw leaders published a declaration demanding self-government.

The oil companies should leave the area, said the declaration, until new terms had been negotiated. Last weekend representatives of dozens of delta groups gathered in Port Harcourt for their first meeting. This ended in a row over the wording of the final communiqué, but the groups were unanimous about the basic problem. All were suffering from polluted rivers, disrupted farming and cut-down forests, without any compensating benefit from oil.

In the face of this militancy, Shell has been obliged to change its policy radically. The company, which produces about half of Nigeria's 2-million barrels a day, this week announced investment plans of $8.5-billion in new oil and gas projects. But, in the eyes of most delta people, Shell has a terrible reputation, synonymous with the Nigerian government.

At least until 1995, Shell was happy to use Nigerian security forces to protect its installations. It even admits to supplying them with weapons. When oil was spilt, it paid off the local chief. This helped to create a "compensation culture": damage a pipeline, then demand cash for the damaged land.

But Shell's attitude has changed: it now accepts that community development is part of its core business. Actual control of the oil, says spokesman Bobo Brown, is a political issue, but Shell has increased its budget for community affairs to $40-million a year. The company has promised to provide the basis for economic development in the 1 500 communities in which it works.

It is an ambitious project, possibly as ambitious as the new $8.5-billion investment. Even so, it was rejected with a scoff by Chief Fabray. It may be too late for Shell to head off an anger that is now demanding not economic development, but control of the oilfields. - © The Economist Newspaper Ltd, London 1999

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