Black Gold on the Dark Continent
The African continent has a long history of foreign pillaging and exploitation of her natural resources. Once it was Europeans who defiled her land in the search for copper, diamonds, bauxite and silver, now its major global corporations who seek to exhaust what is left of the continents lifeblood. Oil is the most valuable natural commodity of the day, not atypically connected with Africa it has started to find favor from the big oil players due to the state conditions in which oil seems to be found.
Equatorial Guinea discovered in the mid 1980’s that they had reserves of oil which would produce an output of over 150 billion barrels. In a world where we are going to war over such a commodity, this vast amount was never going to be ignored and sure enough in 1991, Exxon Mobil moved in to the country. In what was seen to be a good agreement at the time, the government were offered a take it or leave it deal. Exxon would supply the knowledge, equipment and manpower to drill and the country would receive a slice of the profits. With the enormous amount of oil present, things looked good for the country’s future as people looked to Exxon as being some kind of generous benefactor. As one local said in 1997 after the population being told there was no money to deal with dilapidating infrastructure: “They [Exxon] are half way to being Robin Hood.”; why only half way?“…they have not got round to giving the money to the poor”.
In 2003, Exxon announced that it’s subsidiary, Mobil Equatorial Guinea, started production offshore which would recover more than 110 000 barrels a day on top of the current production of over 360 000 barrels per day. A rather large increase which surely would secure a future for a country with just over 500 000 people. The Zafiro oil field and its offshore brother, has been divided up between Exxon Mobil’s subsidiary, Mobil Equatorial Guinea Inc. which will receive operating profits from the oil field of 71.25%, the other two beneficiaries of the country’s oil will be the US energy corp. Devon Energy who will get 23.75% of the profits and finally the Government of Equatorial Guinea who get 5% of total money generated from their resource.
A statement released by Exxon claimed: “Our continued investment in hydro carbon development and in the community provides direct and indirect economic benefits and opportunities for the development and employment of nationals in construction, drilling and production operations”. How very benevolent of them.
While the government and oil associates have filled the coffers with millions of US dollars, the ordinary citizen lives off $1 a day, three of four residents near the oil field suffer malnutrition and yet only 1 percent of the government’s budget was spent on health care between 1997 and 2004. Freedom International, a non governmental organization, decided to assess the situation in the country last year and presented a report to the US State Department and put the country in the lowest category for civilian rights. Amongst accusations of high levels of corruption, they documented cases of human right violations including torture, beatings and abuse of prisoners and suspects which has resulted in suspicious deaths. The group further went to claim that the oil companies payments to government officials and the President Teodoro Obiang Nguema has helped prop up the corrupt regime.
Obiang has ruled since 1979 when he deposed and then executed his predecessor uncle. His human rights record and corrupt system led to the Clinton administration cutting all ties with the island. He was however invited back into the international arena when Bush invited him along with 10 other African leaders to ‘discuss the war on terror’. Months after the visit in 2002, the country’s oil production increased from a ten year stable 17 000 barrels to over 220 000.
The US Securities & Exchange Commission decided to investigate these oil-government ties; Exxon came under particular scrutiny when it was discovered that $500, 000, 000 was paid into a US bank account which is owned by President Obiang. Global Witness, a London based anti corruption group, wrote to the Attorney General, John Ashcroft, asking him to look into this Washington account as well as scholarships being handed to top level officials children to study in the USA. Over $4 million was paid out by Exxon to support more than 100 students, most of whom were relatives of wealthy and powerful officials.
Payments from the oil giant to the government was handled through a Washington based bank, Riggs Bank. From 1995 until 2004, the Bank administered more than 60 accounts for the government, officials and family members. Aggregate deposits ranged from $400 million to $700 million at a time.
The report released by the State Department concluded that the money generated by the country’s oil production has not benefited residents and that most of the country’s wealth is “concentrated in the hands of top government officials whilst the remainder of the population has remained poor” and that in processing the oil money, Riggs bank had “turned a blind eye to evidence suggesting the bank was handling the proceeds of foreign corruption”.
Exxon claimed in response: “We take pride in the way we do business. We think we do business very ethically”. Andrew Singer, an ex- executive president for Exxon, came out after the report and shed some much needed light on the oil company’s involvement with third world regimes. He said: “It may be impossible to do business in such countries without doing business with a government official or a close relative of a government official”.
In light of the State Department report and outing of oil company practice by one pf its own, what is being done to ameliorate the situation? Exxon Mobil has not been brought to book yet for any illegal practices and the country gained world wide attention last year for a series of strange incidences which took an international twist. A plane was grounded in Zimbabwe which was on its way to Equatorial Guinea to engage in a coup d’etat. The outcome was meant to be the overthrow of the current regime and the imposition of a less corrupt and greedy government. The incident however had repercussive effects on various known actors in the UK and US lobby groups. Mark Thatcher was implicated as was Jeffrey Archer, both from wealthy political family’s who had interests in the region and its oil. This all makes for a curious case of international networking and money laundering involving corporations, governments and individual wealthy elites.
The current state of the country has not improved and if anything is getting steadily worse. An Exxon employee working in Equatorial Guinea has claimed that life for the workers is getting precarious and there has been a noticeable change in the attitudes of the people towards the regime and the oil companies that are supporting them. From the outskirts of the capital, Malabo, all that can be seen is vast oil drilling machinery and the houses of the wealthy. Under the shadow of these overbearing epitaphs to western greed lie the shanty towns of the poor. People are starting to realize that their lives have not been made better by Exxon; they live under an authoritative regime and know nothing of the world focus on the practices ongoing in their tiny country. The real problem for the country is that the US has lumped Equatorial Guinea in the same category of ‘possible’ international threat zones along with N. Korea, Iran and Syria.
As long as there is a US corporation in the country, there will be a US strategic interest. Oil companies are the new governments of the day and direct third world policy, especially those petro-states. Exxon is the biggest of them all and it is most definitely a case of a large fish in a very small pond. They’re aim is to control the country’s oil reserves as this allows them to control the international market. Equatorial Guinea is another in a long line of African nations that has had a corrupt regime working hand in hand with a foreign influence that has a vested interest in the country. Let’s just hope that the ordinary citizens will get to taste some of that ‘Texas Tea’ before it all runs dry.
Words: Keelan Morris
Submitted to Natural Matters by http://www.freeradicalmedia.com
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