CSR News - October 2012

Court Case against Shell in the Netherlands

In May 2008, four Nigerian fishermen and farmers from the villages of Goi, Ikot Ada Udo and Oruma, in conjunction with Friends of the Earth Netherlands / Milieudefensie, started a legal case against Shell Nigeria and its parent company in the Netherlands.[1] After several delays, both parties were heard in the court in the Hague on 11 October. The verdict is expected early in 2013.

 

Ghana’s oil wealth is not reaching the poor

Two years after oil began flowing in Ghana, ordinary Ghanaians are wondering where the oil money is going. The government says there has not been much oil revenue coming in thus far, and analysts say the money that is coming in is not reaching the poor. Vast reserves of oil were discovered in Ghana in 2007 and production began almost two years ago in the Jubilee Oil Field off Ghana’s western coast. In 2011, its first year of production, Ghana earned about $444 million - which was only half of the expected revenue. The Finance  Ministry projects that Ghana’s oil revenue will not increase significantly until 2014 or 2015 when production should reach peak levels.

The oil revenue is divided up between the national oil company to fund its share of operations in the field, an investment and savings fund, and then the annual budget funding amount, which can be used in the current year.

In 2011, government documents show that some $167 million of oil revenue went into the annual budget – and only a small percentage of that into social services.

 

Angola: Oil-rich Cabinda the poorer for it

Oil has turned post-war Angola into one of the world's fastest growing economies and Cabinda, which produces a daily average of 500 000 barrels, is the source of nearly a third of its very lucrative export. American energy giant Chevron, working in Angola as the Cabinda Gulf Oil Company, has been in Angola since the 1970s and runs all the operations in the exclave. But for all the liquid gold and associated development, Cabinda remains one of the most under-developed regions in Angola.

A large portion of the population lives in wooden huts without running water or electricity and, beyond the provincial capital, there are few tarred roads and limited health services.

The high number of foreign oil workers passing through Cabinda has created a false economy, pushing up prices, which were already high because its imports must come in by road from the neighbouring Congos.

The costs to the environment also appear to be increasing: fishermen complain that they have to go very far to find a decent catch because the sea no longer has fish, due to oil spills.

 

Oil companies try to undermine revenue transparency

The American Petroleum Institute (API), a lobby group representing companies such as BP, Exxon, Chevron and Shell and other big business lobby organisations have presented a lawsuit against the Securities and Exchange Commission (SEC) They are challenging Section 1504 of the Dodd Frank Act and SEC rules that require oil, gas and mining companies to annually disclose their payments to governments, by country and for each project[2]. The lawsuit is mainly an attempt to delay the application of the Dodd-Frank and shows how far oil companies are willing to go in order not to have to disclose their payments.

 

Thomas Lazzeri