'Nigeria - the Ogoni dilemma'

By Bill Turnbull W.F.

Map showing the various Nigerian States

The involvement of (Royal Dutch) Shell in Nigeria is a good example of how a Multinational Corporation works, the wealth that they can make and the political quagmire in which they can be caught. It is impossible to gain a complete picture of how Shell got itself into the present situation in Ogoniland or to see all the implications of what has been taking shape over the last thirty plus years. What follows may give an idea of the situation and why many of those who could help the Ogoni do not!

Nigerian Politics

Nigeria has been independent for thirty five years, of which only seven have been under civilian rule. The present military regime have been in power since the June, 1992, elections results were annulled by Gen. Ibrahim Babangida. These elections are widely held to have been won by Chief Moshood Abiola, who was imprisoned soon after. The present leader, General Sani Abacha, came to power on 17th. November, 1993.

One in five Africans is a Nigerian as Nigeria has more people than any country in Africa, with nearly one hundred million. It is also probably the richest country on the continent and holds great political, economic and military influence over its neighbours. Within the country there is opposition to the present rulers but it is difficult for this to be focused as there are divisions between the North and South of the country as well as along ethnic lines amongst the 250 different groups. Such disunity helps to keep the government in power.

The Nigerian Economy and Oil

Nigeria has immense wealth and potential. Most of its already realised, and future, wealth comes from oil. Nigeria is the sixth largest oil producer in the world, the fourth largest producer in OPEC, with an output of just under two million barrels a day, which earns about US$12 billion a year. Oil accounts for about 90% of the country's foreign exchange and 80% of its government's revenue. Nigeria exports 1.6 million barrels* of crude oil a day. It is sought after because it is easily refined and has a high gasoline content. The oil is produced by six major companies in the following number of barrels a day: Shell (Anglo-Dutch) 910,000; Chevron (USA) 380,000; Mobil (USA) 310,000; Texaco (USA) 60,000; Agip SpA (Italy) 130,000 and Elf Aquitaine (France) 95,000.

According to Nigerian National Petroleum Corporation (NNPC) figures for crude oil production from various areas in the country are as follows: Ogoniland 25,890 barrels a day; Rivers State 673,624 and a total National crude oil and NGL production of 2,040,000 barrels a day. The United States imports about 750,000 barrels of oil a day (an average of 640,000 a day in 1994) from Nigeria or 45%, of all exports. Canada takes 5%, Western Europe - mainly Spain, France, the Netherlands and Germany - accounts for the rest.

British Interests in Nigeria

Despite having such tremendous wealth Nigeria is US$29 billion in debt, at least US$8 billion in arrears, and is virtually blacklisted by the world's financial institutions. British investments in Nigeria are estimated to be about £3.4 billion. Despite that, and the fact that their profits rose by 75% in 1994, some British companies have withdrawn from the country - they include ICI and Welcome - though others remain, such as Guinness, Cadbury, Peterson Zochonis and Lever Brothers. Nigeria is Britain's 36th. largest world market - taking £458 (US$724) million in exports in 1994 from the UK (more than US$200 million down on 1993), with imports of £125 million, which gives the UK a £333 million surplus.

Nigeria has £1.68 billion on deposit with London banks which is being held against UK loans of £300 million of loans to Nigerian entities (other sources say $65 billion deposits held against $472 billion of loans). It is also said that some London banks have laundered Nigerian money for years, often taking up to 20% commission. Between 1970 and 1989 one estimate puts the amount of money which disappeared from country at £9 billion, though it is very difficult to know its true extent.

Shell

Shell has been working in Nigeria for fifty years and the first oil strike in the Niger Delta was at Oloibiri in 1956. Through its subsidiary company, Shell Petroleum Development Company of Nigeria Ltd., it extracts about half of the country's oil and owns 30% of a joint venture with the Nigerian National Petroleum Corporation (NNPC) which is government owned. The oil which Shell produces in Nigeria is about 14% of it's total worldwide crude oil production.

By the very nature of its work Shell, like other oil companies the world over, has to have close contact with the Nigerian government. This is especially so as a 1978 decree ruled that all land where oil is found belongs to the federal state. As a result, Shell cannot work independently and it is effected when the government does not implement proper environmental standards, or look out for the local people's interests - this is also true for other oil companies, such as Elf and Agip, in Nigeria. Whether companies take advantage of this situation varies in each situation.

Shell and Ogoniland Oilfields

Twelve million people, from different ethnic groups, live in the oil-producing areas of the Niger Delta. The area is a delicate environmental balance even without the presence of oil production. Some parts are freshwater swamp forest, tropical rain forest and savannah, others are saltwater mangrove forest. The land is fertile and a variety of crops can be grown. The creeks are the main network of communication and provide fresh and saltwater fish and shellfish, the freshwater also being used as drinking water. Problems have arisen, not only from oil spills etc., but also when channels are dug to bring in heavy drilling equipment - such as at Okoroba village. Because of the digging, the salt and freshwater can become mixed together, killing off the fish. When there are oil spills the drinking water is also effected.

Shell's Nigerian subsidiary withdrew from Ogoniland in late 1993 after attacks on their installations and staff. Shell say these stemmed from agitation by the 'Movement is the Movement for the Survival of the Ogoni People' (Mosop) and that it has abandoned millions of pounds worth of equipment. It also claims that £30 million worth of damage has been done to four oil pumping stations since it left. Shell has ninety six onshore oil wells and four thousand miles of pipelines. The facilities are old and rundown, suffering from corrosion in the damp climate, which is the main cause of over two hundred spillages each year, though Shell claims that t wo thirds of recorded spillages are due to sabotage. The whole oilfield is in need of modernisation, though Shell say that £63 million a year is being spent on this.

According to Mosop, Shell has made US$30 billion from 900 million barrels of Ogoni oil since 1958 - when it first struck oil. Exploration began in 1956. Shell say that they have produced 657 million barrels with a gross value of US$5.2 billion before costs.

According to figures compiled by the World Wide Fund for Nature (WWF), at the moment the Ogoniland oilfield is the world's biggest single cause of global warming. The gas which is found with the oil is flared instead of being piped away and used. This flaring emits thirty four million tons of carbon dioxide, the main greenhouse gas, a year and the oilfield emits a further twelve million tons of methane, which is up to thirty five times more potent. In comparison, fuel burning in Britain's homes emits twenty three million tons of carbon dioxide and forty six thousand tons of methane a year.

To try and cut down on damage caused by gas flaring, and also to utilise the resource, Shell is involved in building a new gas plant. At present about 75% of the gas brought up with the oil is burnt off, which compares with 20% in Libya, Iran and Saudi Arabia and 4.3% in Britain. Shell completed a US$4 (£2.5) billion agreement for 24% share in liquified gas plant, at Finima on Bonny island, Rivers State, which will create 6,000 construction jobs and be opened in 1999. It comes under the auspices of the 'N igerian Liquified Natural Gas Ltd.' (LNG Ltd.) which is jointly owned by the Nigerian government (49%), Agip (10%), Elf (15%) and Shell. The World Bank's 'International Finance Corporation' (IFC), should have had the remaining 2% but they pulled out in November, 1995. The Nigerian government has already committed US$1 billion (£660 million) to the plant. When the gas plant is completed 45% of the gas that was previously flared off in the Delta oilfields will be collected and sold to Italy, France, Spain and Turkey. Map showing Southern Nigeria

The Ogoni and the Niger Delta

Some say that for Shell the Ogoni problem is similar to that of the Brent Spar, which happened earlier in 1995. The Ogoni confrontation has been going on for many years but it was only brought to a head, and given a world profile, when the nine Ogoni leaders were executed in November, 1995. Since then it has largely been forgotten. The cynical say that it is not on Europe's doorstep and so does not arouse the same strong feelings among people here!

The Ogoni are not the first people to protest against oil development in the Niger Delta. In 1990 the Etche people demonstrated peacefully against Shell. Shell's response was to call for police protection in case of further action. The Mobile Police Force (MPF) was sent and 80 people were killed, 495 homes destroyed. The situation worsened and in the Summer of 1992 the MPF went into villages in the Gbaran oilfield and shot 30 people and beat 150 others.

The 'Movement for the Survival of the Ogoni People' (Mosop) was launched in October, 1990. It is basically a non-violent movement but the security forces have used violence against them in order to provoke a reaction. Mosop voices much of the Ogoni people's grievances. There are about 500,000 of the Ogoni people who live in an area 400 square miles (Ogoniland), about the size of Greater London, in Rivers State.

Mosop's demands are: compensation for, and repairing of, the environmental damage; the regeneration of their farms and waterways; US$10 billion (£6.6 billion) in ren t and royalties for oil extraction i.e. $20,000 (£12,600) for every Ogoni man, woman and child; political, economic and developmental autonomy for Ogoniland; and direct representation in all Nigerian institutions.

The writer Ken Saro-Wiwa and eight other prominent Ogoni leaders were sentenced to death by a 'Civil Disturbances Special Tribunal', in Port Harcourt at the end of October, 1995. The charge against them was that they allegedly incited the murder of four chiefs in Ogoniland on 21st. May, 1994. There is no evidence that Saro-Wiwa advocated violence, and both he and a co-defendant, Dr Barinem Kibbel, were designated as "prisoners of conscience, imprisoned for non-violent expression of their views" by Amnesty International .

By the very nature of tribunals in Nigeria, from their inception by decree in 1966, their decisions are not subject to any other court, they cannot be over-ruled and there is no right of appeal. As a result all the defendants were denied access to ordinary courts or to fight again st their sentence. With such a history it was no wonder that they were executed on 10th. November, 1995. John Major described the executions as "judicial murder".

The Danger and Dilemma

Where there is money to be made in developing countries then Multinationals will take their chances. Shell have been accused of propping up the Nigerian regime with the profits made from oil. The new gas plant will help the global environment, but will also help fill the government coffers. It will provide jobs for people in the Niger Delta but, no doubt, will bring more problems for the environment and is open to sabotage. When the Ogoni people take on Shell they also take on the government, as they are so intertwined. In this situation there is no winner and until the ordinary people are able to voice their opinions freely and be listened to, by both Shell and the government, there can be no change for the better.

N.B. * One 'barrel' of oil is 35 Imperial Gallons. (A British Imperial gallon is 4.546 litres, therefore a 'barrel' is 159.11 litres)

'Nigeria - a footnote'

The Commonwealth took the international lead to push Nigeria towards democracy during the Commonwealth Conference in Auckland, last November. The Nigerian government would probably claim that speeches by Robert Mugabe and Nelson Mandela, at the Conference were anti-Nigerian, but they have become catalysts for further action. As a result of that meeting Nigeria has been suspended from the Commonwealth, is excluded from Commonwealth governmental meetings, and banned from sporting events and technical aid has been stopped. A five member Commonwealth team was due to visit Nigeria to discuss how the country can move towards civilian rule, but was not allowed entry (reported in 'The Guardian' 18/01/96). Eight foreign ministers, from the Commonwealth, have been asked to monitor the country's progress towards democracy over a two year period. The Commonwealth is also studying the possibility of freezing the regime's assets abroad and maybe even the possibility of oil sanctions. Nelson Mandela's comments after the Commonwealth Conference have encouraged the Opposition parties in Nigeria to become more united and to form links with South Africa, even to the extent of setting up an office in exile there.

Nigeria has tried to divide Commonwealth countries since the November meeting. In a UN General Assembly vote 'condemning' Nigeria fourteen Commonwealth countries abstained. The resolution was passed by ninety eight votes to three - the latter being Nigeria, The Gambia and Sierra Leone.

The first real test of the present Nigerian regime's commitment to democracy will come with the lead up to the promised elections in March this year, and whether they actually take place.

23/01/96

THIS ARTICLE FIRST APPEARED IN "WHITE FATHERS - WHITE SISTERS" (UK), ISSUE 327, OF APRIL-MAY, 1996.

THE ARTICLE MAY BE PUBLISHED FREELY WITH DUE ACKNOWLEDGEMENTS TO THE "WHITE FATHERS - WHITE SISTERS" MAGAZINE.

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