Nigerian villagers who have long clashed with oil companies doing business
in their backyards are trying a creative protest tactic. They've dropped their
guns, and some have even threatened to drop their clothes.
Hundreds of unarmed women from local tribes in the oil-rich but desperately
poor Niger Delta region brought production to a halt recently at pipeline facilities
owned by ChevronTexaco by merely occupying the sites. Several dozen village women
are still holed-up today.
To make their point, the women threatened to disrobe a strong local
shaming symbol and managed to strike a deal with ChevronTexaco that will
bring jobs and funding for schools, hospitals and other services into their struggling
In the past, local actions against oil and gas companies have come from armed
gangs who frequently take to kidnapping and sabotage to demand jobs or money.
But experts say ChevronTexaco's peaceful negotiations with the local women
highlights the strengthened bargaining power villagers wield and how multinational
corporations, under significant international pressure, are increasingly bowing
to local demands.
"This shows the kind of pressure on the oil companies to come through with
ever higher levels of contributions," said J. Stephen Morrison, director of the
Africa program at Center for Strategic and International Studies. "The pressure
has been building for a long, long time."
An Otherwise Violent History
Unlike the peaceful Nigerian women's protest, the relationship between locals
and oil companies often has been violent and tumultuous.
Shell came under fire after riotous protests related to the death of organizer
Kan Saro-Wiwa in 1995. The native playwright was executed on trumped-up murder
charges by the military dictatorship in Nigeria after he organized a protest movement
aimed at the oil company.
Such troubles are not unique to West Africa.
Human rights activists have sued ExxonMobil in U.S. federal court, accusing
the company of hiring Indonesian government security forces who allegedly committed
atrocities against locals, including murder, torture and kidnapping. The company
denies the allegations.
In Colombia, leftist rebels are suspected of blowing up a pipeline a record
170 times last year. The pipeline fed oil from a field operated by the U.S. oil
Such tension is perhaps inevitable in poor regions where global companies
come to get rich. Like other "extraction" businesses, such as mining, oil companies
are often accused of taking natural resources, giving little back in return and
spoiling the environment.
The oil business does not employ large numbers of local people once pipeline
facilities are built.
"Revenues generated don't adequately benefit the local area," said Arvind
Ganesan, director of the business program at Human Rights Watch.
Where's the Payoff?
Regions that produce high yields of lucrative natural resources such as oil
or diamonds tend to suffer from what economists call "Dutch disease," which refers
to the wasting away of other industries such as manufacturing or farming.
The result is a population with scarce resources and abundant resentment for
companies operating in their midst. "Where's the payoff? All of this wealth has
spun through this government with very little coming back to the average citizen,"
These days, it's becoming commonplace for major oil companies to try to shine
their international reputations by making investments and charitable contributions
in countries where they operate.
"Basically what you become is a partner with the local community to provide
things they need to exist and not feel you're an outsider taking over everything
they have and not giving anything back," said Bud Covert, executive director of
the Energy Security Council, a Houston-based group comprised of the security directors
of most American oil and gas companies.
Investing in local communities, of course, also reaps rewards for the companies
by fostering stability.
For one, Shell, which suffered major public relations damage from its Nigeria
fiasco, now reportedly gives away millions a year in local grants. On its Web
site, Shell describes building classrooms in the Niger Delta, awarding school
scholarships and immunizing more than 100,000 young children.
ExxonMobil says 85 percent of the royalties and taxes generated from a $3.5
billion pipeline project in Chad and Cameroon will be used for social programs
to help local citizens.
Striking a Balance
In the past, money paid to national governments frequently never trickled
down to the local level. The trick, in countries rife with corruption, is for
companies to make wise choices about how they invest their money.
"Oil companies get hit up constantly. They are trying to manage their affairs
in ways that are defensible and credible by putting money toward real projects
and not just payoffs," Morrison said.
With no global regulating body, though, some experts question how far corporations
can and should go to provide certain services such as schools, hospitals and basic
"Why should the lead responsibility for social development function fall upon
a private enterprise when we know government is ingesting vast flows and they're
not being returned?" Morrison said.
In some cases, of course, there are few options. "It should be the role of
government, be it local, regional or national government, but in some countries,
they are simply not ready," said Stephen Hayes, president of the Corporate Council
on Africa. "Should businesses be expected to cover all that? There's a growing
consensus among oil companies about putting resources back into the communities
but there's got to be a balance at some point."
Other experts question the long-term viability of relying on corporations
for funding major development projects for poor nations.
"The danger sign is when people start turning to companies to take on social
services," Ganesan said. "It's unsustainable over time."
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