Explotation of African Oil and who Benifits

"Untapped: The Scramble for Africa's Oil"
By Amy Goodman
Democracy Now!

Thursday 17 May 2007

Historian and Journalist John Ghazvinian discusses his recent trip to Nigeria and the African oil boom. The U.S. now imports more oil from African nations than from Saudi Arabia. [includes rush transcript] We begin today's broadcast with a look at Africa and oil. It's a little known fact: the United States today imports more oil from Africa than from Saudi Arabia. More than $50 billion in foreign investment in African oil is expected over the next three years.

What has this oil boom meant for Africa's ordinary citizens? Our first guest spent a year reporting across the continent to find out. John Ghazvinian is a journalist who has written for publications including Newsweek, The Nation and Time Out New York. His new book is called “Untapped: The Scramble for Africa's Oil." The book compares the global competition for the continent's oil resources to the nineteenth century scramble for colonization.

John Ghazvinian has just returned from Nigeria, where oil has been the driving force behind a longstanding bloodshed. Protesters in Ogoniland have just ended their week-long occupation of a major oil pipeline hub that forced Royal Dutch Shell to cut their daily production by nearly 40%. In recent weeks, villagers demanding compensation and regional control over Nigerian oil have kidnapped at least 13 foreign workers, occupied a Chevron oilfield, and bombed other international oil pipelines. Two major US companies, Chevron and Hercules Offshore, are evacuating all their non-essential workers from the oil-rich country.

* John Ghazvinian, Journalist who has written for publications including Newsweek and the Nation. His new book is "Untapped: The Scramble for Africa's Oil." He is a visiting fellow at the University of Pennsylvania.

TRANSCRIPT

Juan Gonzalez: We begin today's broadcast with a look at Africa and oil. It’s a little known fact: the United States today imports more oil from Africa than from Saudi Arabia. More than $50 billion in foreign investment in African oil is expected over the next three years by the United States.

What has this oil boom meant for Africa’s ordinary citizens? Our first guest spent a year reporting across the continent to find out. John Ghazvinian is a journalist, who has written for publications including Newsweek, The Nation, and Time Out New York. His new book is called Untapped: The Scramble for Africa’s Oil. The book compares the global competition for the continent’s oil resources to the nineteenth century scramble for colonization.

Amy Goodman: John Ghazvinian has just returned from Nigeria, where oil has been the driving force behind a longstanding bloodshed. Protesters in Ogoniland have just ended their week-long occupation of a major oil pipeline hub that forced Royal Dutch Shell to cut their daily production by nearly 40%. In recent weeks, villagers demanding compensation and regional control over Nigerian oil have kidnapped at least thirteen foreign workers, occupied a Chevron oilfield and bombed other international oil pipelines. Two major US companies, Chevron and Hercules Offshore, are evacuating all their nonessential workers from the oil-rich country.

John Ghazvinian joins us now from Philadelphia, where he’s a visiting fellow at the University of Pennsylvania. Welcome to Democracy Now!

John Ghazvinian: Good morning.

Amy Goodman: Before we talk about Somalia, Ethiopia and Sudan - and what’s not often talked about is oil there - let’s talk about the latest news out of Nigeria, out of the Niger Delta. What is happening there, John?

John Ghazvinian: Yeah, as you say quite rightly, it’s actually more of the same, to be honest. The situation in Nigeria is now as bad as I think anyone can remember it. Many of your listeners and viewers will be aware of the struggles of the Ogoni in the 1990s against Shell, and so on. That was really child's play compared to what’s been going on in the last couple years in Nigeria, and ironically we hear less about it.

But, you know, I was just there a couple weeks ago. Just in the sort of four or five days I spent in the Delta, there were twenty-nine foreigners taken hostage, kidnapped by militants. You know, it’s the same story, basically. It’s a battle over access to oil money and for resource control, and it hasn’t gone away, and it’s not about to go away.

Amy Goodman: The fact that the United States gets more oil from Africa - now, that’s a continent versus Saudi Arabia, which is a country. That’s not often recognized by our leaders, the continent versus country issue, but that’s still extremely significant. Give us the picture of Africa, where the oil is and where many are hoping it will be.

John Ghazvinian: Yeah, actually, you know, the US, as you say, gets as much oil now from - as we do from Saudi Arabia, but actually we’re going to be getting about - you know, much more in the next few years. This is what’s significant is that by 2015, we’re going to be getting 25% of our imported oil from Africa. And, you know, this is why I wrote the book, really, because I feel like this is something we don't pay a lot of attention to. When we think of oil, we tend to think of the Middle East or other parts or Venezuela or other parts of the world. But Africa is becoming increasingly important for our way of life and our energy needs, and I think it’s important for people to have some idea what some of the issues are in some of these countries.

To answer your question, the big kind of African oil boom at the moment, or at least in recent years, has been along the west coast of Africa in the Gulf of Guinea, what some people like to call the armpit of Africa - if you sort of picture a map of Africa, that sort of ninety-degree bend along the ocean there. You know, it’s a lot of deep water offshore discoveries that have really been coming on stream recently at places like Angola that are really up and coming. Angola has just joined OPEC a couple months ago. It’s the first new member of OPEC in more than thirty years, and it’s an African country, and it’s rapidly catching up with Nigeria. People are now talking about East Africa, that was possibly the next big margin, you know, the next kind of big oil boom for Africa. That’s much closer to China, so it has some obvious benefits there.

But the bottom line is that Africa, as a whole, is really deeply under-explored and kind of under - it’s not really looked at as much as it could be. I mean, there’s exploration blocks the size of France that still haven’t been given away, and it’s a very hot and very exciting destination for the oil industry right now.

Juan Gonzalez: I’d like to ask you, in particular, about Nigeria. Clearly it’s become an increasingly big supplier to the United States, yet we have all of these enormous problems there, the attacks on oil facilities, the rampant apparent violations during the recent elections, and very little attention in the American press to what is happening in Nigeria, compared, for example, to all the attention that the press gives to Venezuela, where there is not this kind of, like, dislocation of the oil industry or questions about the legality of their voting process.

John Ghazvinian: Yeah, I know, exactly. Nigeria is the fifth largest supplier of oil to the United States, which I think is something a lot of people are not aware of. We get a lot of our oil from Nigeria. You know, I don’t know why we don’t pay more attention to it. I think a lot of it has to do with the fact that a lot of international media organizations don’t have someone in West Africa. They often have someone in Johannesburg and Nairobi, and that’s it, really, especially in the English-speaking world.

But Nigeria is extremely important. You know, this is a country of 130 million people. One out of every six Africans is Nigerian. You know, as I say, it’s one of the biggest oil producers in the world. It has a large and very experienced army, and it’s a real anchor for American and British foreign policy in Africa, actually.

Amy Goodman: But in Nigeria, the way - when it is covered in this country, the discussion is of the vandals, the criminals that are tapping into the oil pipelines, stealing the oil. Can you describe who it is who is organizing in the Niger Delta, John?

John Ghazvinian: That’s a very good question, and if I knew the answer to that, I’d have a lot more insight than I do. I mean, the truth is that it changes often, and these groups splinter, and often, to be honest, a lot of criminal elements also kind of jump on the bandwagon. It really varies day-to-day, and it’s a very difficult and very complex situation to follow.

But in recent - in the last year and a half, the big kind of group, the umbrella group that’s been getting most of the attention is a group called MEND, the Movement for the Emancipation of the Niger Delta. They’re kind of an Ijaw group. They have kind of inherited the mantle of the Niger Delta People's Volunteer Force, which was also an Ijaw group from a couple years ago. You know, like I say, things have moved on a lot since the days of the Ogoni and MOSOP, but to try to say who exactly is responsible for some of the vandalism or kidnapping, or so on -

Amy Goodman: John, their concerns? Talk about who is profiting from the drilling in the Niger Delta?

John Ghazvinian: Yeah, this is at the bottom of the issue, basically, is that for more than forty years, international oil companies have, you know, pumped billions of dollars worth of oil out of Nigeria. $400 billion has gone into the pockets of the Nigerian government, and most of that money, frankly - a lot of that money - has been salted away into foreign bank accounts by corrupt politicians and then, of course, has gone away, disappeared in the form of profits to multinational oil corporations.

Who has not seen the profits from oil exploration is probably the real question, which is the people of the Niger Delta. You have people living in stone age squalor, in mud huts, you know, in swamps with no roads, no electricity, no running water. I spend a lot of time in the Delta, and I’ve seen the way people live there. And, you know, through their backyards you have thousands of miles of pipelines, ultra-modern, multi-million-dollar, air-conditioned, state-of-the-art facilities going up, and people just haven’t seen any benefits from the oil exploration. And over time, that has turned into a fairly nasty sort of militant insurgency, as I think shouldn’t surprise anyone, really.

Amy Goodman: Talking to John Ghazvinian, journalist, who has written for many publications. His new book is called Untapped: The Scramble for Africa’s Oil. He has just returned from Nigeria. When we come back, we’ll talk about US multinational corporations versus China, and areas, countries like Ethiopia, Somalia and Sudan. Stay with us.

[break]

Amy Goodman: Our guest is John Ghazvinian. His book is called Untapped: The Scramble for Africa’s Oil. Juan?

Juan Gonzalez: John, before we get onto Somalia, Sudan and some of these other countries, I’d like to ask you about some old oil producers in Africa: Algeria and Libya. They both have had oil industries. What’s been the difference in their development and what’s been happening in recent years as to what’s going on with their oil?

John Ghazvinian: Yeah, as you say, those are more longstanding oil producers. They’ve probably done a slightly better job of actually bringing real development - particularly Libya - to their people, thanks to oil exploration. Libya is also a very hot new destination now. It’s now opening up to Western companies.

I don’t deal a lot with North Africa in the book, and the reason for that is, you know, North Africa is in many ways an extension of kind of Arab and Middle Eastern - sort of the political arena. What I was really trying to draw attention to in this book, which is something that I think a lot of people don’t pay a lot of attention to, is Sub-Saharan Africa. That’s just not a part of the world we think of when we think of oil. And so, I really focused, you know, kind of my - you know, my book on countries like Nigeria, Angola, Chad, Sudan, you know, Gabon, and so on.

Amy Goodman: John, can you talk about how China has emerged as a major oil player in Africa and their difference in diplomacy and strategy than the United States and the US multinational oil companies?

John Ghazvinian: Yeah. This is a very interesting question, actually. I mean, China is a big, big part of the story. They now get 30% of their oil from Africa, which is really extraordinary, and about 10% from Sudan, specifically. This is, you know, I think -

Juan Gonzalez: When you say 30%, are you talking 30% of their imports or 30% of their total oil use?

John Ghazvinian: When it comes to China, there’s not a really appreciable difference, to be honest, but 30% overall, actually - 29%, I think it is now, specifically.

But the thing about China is, you know, I think we hear a lot of this kind of Yellow Peril talk in the press, you know, that they are kind of a maligned force in Africa, and I think it’s actually a mixed bag. It is true that China goes in and doesn’t ask a lot of questions of countries like Zimbabwe or Angola or Equatorial Guinea. But, you know, there’s also a sort of, if you like, less threatening side to China's presence in Africa. They, for many years, have trained thousands of Africans in Chinese universities, sent thousands of doctors to Africa, and Africans haven’t forgotten that.

The Chinese are very good at - you know, like they came into Angola a couple years ago, and they said, “Look, you just had a thirty-year civil war, you’ve got a lot of needs. You need a new airport. You need a new railway, a new highway. We’ll build all that for you, and we’ll give you a $2 billion credit facility, no questions asked.” Now, that got a lot of criticism, because basically for many, many years, the IMF has been in this kind of longstanding battle with the Angolans, saying to them that you have to be more transparent, you have to tell us what happened to the $4 billion of oil money that went missing in the final years of the civil war, all of which is fair enough, but at a certain point the Angolans said, “Actually, the hell with you. We’re getting a lot of money from oil now. We’re getting - we have a lot more oil than we’ve ever had. The price of oil is really high. And the Chinese have just given us all this money. So we’re not going to open our books to you.” And, yes, that did get a lot of criticism, and I think it is important for people to know what happened to the missing $4 billion, and I wouldn’t want to play that down. But at the same time, it’s also very important for the Angolans to get a new railway, a new highway and a new airport. And that’s something that I think tends to get ignored often in this kind of very polarized debate over the influence of China in Africa.

Amy Goodman: Can you talk about Chad, Sudan, Somalia?

John Ghazvinian: Sure. That part of Africa, the Sahel and the Horn of Africa, obviously a very troubled part of the continent, very poor and very desperate part of the world. Chad is a country that’s recently started producing oil. It’s one of the poorest and most troubled countries in the world. It’s twice the size of France, and it has about 400 kilometers of paved road. You know, the national airline has one airplane. It doesn’t even fly to the south of Chad, where the oil is. This is a country that is one of the world's newest oil producers, but there isn’t even a single gas station anywhere in Chad. People sell, you know, gas along the side of the road in little glass jars from sort of little lemonade stands.

All of the oil gets stuck into this ExxonMobil pipeline that was built a few years ago and sent off to the coast in Cameroon and put on boats and brought to America or to Europe. Chad is a country that really has not seen any kind of benefit, you know, to its people from oil exploration, and yet this was supposed to be one of the great models.

There was this great sort of program put together by the World Bank and Exxon. You know, 85% of the money was going to go to priority sectors like schools and hospitals, and so on. It didn't really work. There was a lot of fanfare, and then for a lot of reasons it just didn’t work.

You know, but if you travel around in Chad, you see that this is a country with a lot of problems. It’s very unstable. The president is a guy who walks around with a lot of body doubles and who’s been tenuously holding onto power for the last two or three years. It’s unfortunately another tragic story of oil in Africa.

Juan Gonzalez: Could you talk a little bit about the impact of this kind of development on poor countries like Chad, the influx of oil workers - I think you call them oilfield trash - that come in from all over parts of the world, end up working and living in these areas, and all kinds of clandestine industries arise to meet their needs?

John Ghazvinian: Yeah, it’s really extraordinary. You know, you start to see this again and again and again, as I did, you know, as I traveled through all these oil towns in Africa. You have often hundreds, if not thousands, of oil workers from all over the world sent on four-week shifts in to work on the rigs, and they’re often housed in these extraordinary compounds with kind of - behind these very high razor-wire walls in these kind of sprawling Southern California-style compounds with, you know, swimming pools and air-conditioned basketball courts, and so on, and, you know, kind of everything that you’d want, really, all the food flown in from the States or from Europe.

And then, just on the other side of the wall, you have people who are living without any running water, who are walking for miles just to fill up their buckets of water, people who are suffering from malaria, living on less than a dollar a day, and so on. I mean, the contrast is one of centuries, really - the gap, the gulf, if you will, in living styles. And this is a real affront, actually, in the face of the people who are sitting there, who realize, you know, there’s a lot of oil in our country, there’s a lot of money being made, but somehow we’re not seeing any of that. And that’s something that you hear a lot of anger and a lot of frustration about just on a very visceral level.

Prostitution also is a big problem in a lot of these places. You know, obviously, you have these guys, and they’re all sort of men, really, who come and work on the rigs from all over the world and have a lot of money, obviously, that they bring with them. So you have girls coming from all over the place, you know, to kind of service their needs, as it were. And that obviously, you know, contributes to HIV and broken homes and all kinds of social problems, as well.

Amy Goodman: John Ghazvinian, the connection between oil production and arms sales and US military agreements with these countries?

John Ghazvinian: Yeah. The Angolans for many years, in the last years of the civil war, were, as I say, funneling billions of dollars to buy weapons to put down the rebellion that was for many years backed by the United States and apartheid-era South Africa. You know, the US military presence in Africa - the kind of US military interest in Africa sometimes gets, I think, overplayed, as well.

It comes down to three things. It’s basically counterterrorism, the kind of global war on terror, which is largely a North African and Horn of Africa story - largely it’s overhyped, to be honest. You know, these groups like the GSPC or the Salafists in Algeria are not really, you know, the next al-Qaeda, nor is there any kind of al-Qaeda presence in Nigeria, despite what some people like to claim. That’s number one.

Number two is African peacekeeping. You know, the whole slogan of African solutions to African problems, trying to get the AU to step up and kind of police Africa, so that - the US priority being not to get dragged into another military conflict like Somalia and another Black Hawk Down situation. There’s no appetite for that in the US, for obvious reasons.

And then, the third is oil and just ensuring stability, you know, making sure that there’s a stable contractual environment and a stable operating environment for multinational oil companies, so that as much oil as possible comes onto the market. Those are the sort of three priorities for the Pentagon and for the US administration, in general, in Africa.

Juan Gonzalez: Also, I’d be interested in knowing why you decided to do this book and take this trek through Africa, some of your own personal experiences in preparing it.

John Ghazvinian: Yeah, the thinking behind this book was pretty simple. As I say, you know, when we tend to think of Africa, we tend to think of tragedy and suffering and misery, and oil. And I was trying to bring a fresh approach to Africa. I was hoping that, if nothing else, oil might focus the attention of Americans on Africa. Even if it’s just for selfish reasons, that’s fine. That’s good enough. At least people start talking about it, you know.

And really what I wanted to do was to try to bring the story to life. You know, I didn’t want to write a book that was full of facts and figures and really boring and kind of policy wonky or academic. I wanted to kind of get under the skin of the story a bit, really try to bring it to life and go to each of these countries and tell stories and anecdotes and talk to people from all walks of life to try to really give a wide-ranging flavor of the challenges and the obstacles and what it means for Africa and what it means for the world that we’re now getting so much more of our oil from Africa. That’s kind of -

Amy Goodman: John, we just have thirty seconds, but do you think oil is a secret motive with US relations with Sudan?

John Ghazvinian: Possibly. I mean, yes and no. I mean, look, I think China is much more transparent about oil in Sudan. The US relationship with Sudan is a complex one, and for the last few years it’s had a lot to do with cooperation on counterterrorism and intelligence gathering, as well. The Sudan conflict is a lot more complicated than it tends to get presented out as in the media, to be honest, especially the Darfur conflict. And oil kind of plays a part, but it’s not the main driving factor.

Amy Goodman: John Ghazvinian, I want to thank you very much for being with us, has written the book Untapped: The Scramble for Africa’s Oil.