In this guest blog post, Professor Anna Zalik of York University Canada explores how governments and multinationals criminalise protest and gloss over the environmental injustices of oil extraction.

Q: What does the Canadian Government’s fury at opponents of the Enbridge Northern Gateway Pipeline have to do with the Nigerian ‘legaloil’ campaign?

A: Both positions are about justifying private profits and criminalizing protest.

The Nigerian government raised fuel prices on 1 January 2012, an act that led to a national strike and widespread protest among a mass movement, at times identifying as Occupy Nigeria. For about a decade the oil multinationals in Nigeria have tacitly endorsed a campaign, supported through industry consultants, to describe their production as “legal”. This use of the term ‘legal’ aimed  to counter the call for ‘resource control’ among a youth insurgency movement which partly supported itself off the trade in contraband oil. Like a range of social and environmental rights organizations in Nigeria and internationally, the youth insurgency in the Delta rose from opposition to the social and ecological  injustices that secured private-industry contracts to lift Nigerian oil.  During the height of the Ogoni movement and following Ken Saro Wiwa’s judicial murder in 1995, there was widespread consensus that the partnership between the Nigerian State and the multinational oil industry was ‘unjust’ regardless of whether or not it was ‘legal’.

In the aftermath of the Saro Wiwa’s execution, the Niger Deltan movements became increasingly militant. Escalations in the ‘oil war’ in the Niger Delta from 2004 onward were accompanied by a campaign by the oil industry operating in Nigeria to reframe their activities as socially-responsible and to label resistance movements criminal. In contrast to the sympathetic portrayal of the Ogoni uprising in the 1990s, or the 2002 “Women’s sit-in” against Chevron (in which a group of women threatened to disrobe on a platform), armed militia activity in the Delta came to be depicted internationally as a kind of ‘competitive thuggery’.

Part of the strategy for criminalizing protest involved the transnational oil companies pathologizing Niger Deltan unarmed protest not only externally and internationally, but also in the minds of those most subject to the ravages of oil extraction. Some residents of the Delta’s riverine region would refer to any facility takeover or shutdown as ‘violence’, a view promoted by industry in its emphasis on avoiding work stoppages and outlawing demonstrations. Mainstream media and policy analysts played a role in this criminalization, through the use of terms like terrorism to describe the deepening ungovernability of the region. Ultimately, if a key tactic of unarmed resistance movements – like blockades – became known as ‘violent’ protest, civil disobedience – which garnered international sympathy -would become an ineffective strategy: it is unsurprising that the Niger Deltan resistance movements became increasingly radicalised.

The web site Legaloil.com promotes the discursive and material criminalization of the oil bunkering trade in the Nigerian context – equating it with conflict diamonds. The legaloil website was established in 2002-3 when control of the contraband trade was said to have slipped increasingly out of the hands of the military and oil industry employees that previously directed it, into those of the armed youth that formerly served as their henchmen. Legaloil.com functions as a directly ‘global’ intervention that presents data concerning bunkered shipments (the source of which is hard to verify or monitor, but becomes ‘real’ once presented as graphs and tables), tracks threats and attacks on installations, and endorses chemical fingerprinting as means to distinguish between licit and ‘illicit’ oil. The site also seeks to present its data, and its proposals, as legitimated by Nigerian sources. Indeed, to be successful internationally, the ‘legal oil’ label requires reshaping the way exploitation in the Niger Delta is understood locally and globally so that ‘abusive’ relations of extraction come to be associated with bunkering activities, rather than the (state-sanctioned) operations of multinational oil companies so criticized in the 1990s.

Yet despite such efforts, the armed strategy of the Niger Deltan insurgency was partially successful in transferring resources to its leadership, although not to the average Niger Deltan or Nigerian.  The Deltan insurgency has been subdued since the  rise to the presidency of a Niger Deltan, Goodluck Jonathan, an outcome that would have been unthinkable a decade earlier. But as international attention to resistance in the Delta waned, so has international attention to corporate malpractice there. In the past month, Shell and Chevron operations in Nigeria have seen two major ‘accidents’, neither of which have received much attention in the global media.  Unfortunately, despite such business-as-usual in terms of the oil industry’s effects, some former insurgent leaders in fact supported Jonathan in critiquing the mass protests against the removal of fuel subsidies. Key Niger Deltan activists have endorsed Occupy Nigeria, however.

The Canadian government has endorsed a parallel campaign to Legaloil.com so as to whitewash the tar sands, in reaction to a transnational movement opposing its social and ecological impacts. The Harper government has relied on Ezra Levant (Canada’s answer to Rush Limbaugh) and his poorly informed, orientalist book to try to rebrand the tar sands as Ethical Oil. This campaign persists despite serious accidents whose costs are absorbed by Canada’s Indigenous people. A recent example is the oil spill on Lubicon territory in Alberta last May which was hushed up in the national media just days before the federal election.

Opposition to Canadian tar sands expansion, as in the case of support for Niger Deltan environmental rights groups in the 1990s, is both domestic and international. Western Canadian aboriginal groups, social justice and environmental movements have come out in droves to speak against the Enbridge Northern Gateway pipeline in hearings, acts that Canada’s government has labeled tainted by ‘foreign money’.  This week, a staff person of a far-from-radical Canadian environmental NGO signed a sworn affidavit concerning how the Canadian Prime Minister’s Office had described them as an ‘enemy of the people’ to their main funder. Opponents to tar sands expansion, it would seem, are increasingly “illegal”, according to Harper’s government.

Ultimately the protesters in Canada, like the Nigerian mass movement calling for a repeal of the fuel price hikes, call for a combination of resource and ecological sovereignty. They demand that restrictions on, and distribution of, oil and gas industry profits are made in the name of the public justice. They protest the ‘legally’ mandated extractive profiteering, of private industry-state partnerships in oil, gas and mining – profiteering which is increasingly understood as corporate theft of common property.

Photos courtesy of Morris Alagoa at ERA/FoE Nigeria.

The rig has now completely collapsed under the intense heat of the flames. Chevron is still “finalizing plans for a relief well to fight the fire”. But these pictures show no sign of the company’s efforts to monitor the impact of the fire or protect local fishers.

The local community, which relies on fishing as a primary means of livelihood, has drawn attention to the ecological impact of the disaster. Below is a deformed dead fish observed near the site.

The company has so far dismissed the impact on local livelihoods, claiming that “no impacts to the beach have been reported.” However, the disaster appears to be having devastating consequences for marine life. As ERA reports from the Koluama River:

“There were dead fish floating and some in throes of death; struggling to stay alive.”

Chevron has been criticised for its lack of transparency over the incident. Locals have been kept in the dark about Chevron’s emergency response plan, the risk to the local population and any information about efforts to control the fire and limit the environmental damage. Chevron has also been silent about what the worst case scenario and what this means for its stakeholders.

Reuters reports that:

Local people reported a loud explosion on the rig early on Monday. “I heard a really loud bang and there was a fire,” local village chief Young Fabby, 55, said by telephone.

A statement from civil society groups, NAGCOND (National Coalition on Gas Flaring and Oil Spills in the Niger Delta), demanded greater transparency from Chevron and an immediate response from the Nigerian government:

NACGOND is shocked by the news of the blowout and fire on the KV Endeavour, and is worried by the sheer frequency of these incidents within the oil industry in the Niger Delta. We extend our condolences to the colleagues and family members of those injured or missing.

We are aware that this is already a major incident with potential for disastrous impacts on the local environment, ecology and livelihoods of communities in the region.

We call on Chevron to immediately release all information that it has on the present situation and likely developments in coming days.

We call on the Federal Government to make an immediate assessment of the situation, and to mount a vigorous response to attenuate the consequences of the fire. If the situation is as grave as we fear it is, then we ask that government should work with both Chevron and, if necessary, the international community to mobilize an effective response.

We urge both Chevron and the FG to immediately inform communities living in close proximity to the site, and in the region of the actual situation and also afford them a realistic assessment of the risk that this incident poses moving forward.

The incident is just the latest in a long run of major offshore oil spills in Nigeria by Shell, Chevron and Exxon Mobil. Last month, a ruptured pipeline at Shell’s Bonga platform spilled an estimated 40,000 barrels into the sea and threatened the livelihoods of dozens of local fishing communities. Oil companies have a legacy of over 55 years of environmental devastation onshore in the Niger Delta. Chevron is one the largest oil operators in Nigeria, producing an estimated 524,000 barrels per day in 2010, second only to Shell.

Brazil lawsuit

Chevron is also facing a $10 billion lawsuit for a recent pollution incident in Brazil, Bloomberg reports. On 7 November 2011, Chevron spilled 3,000 barrels of oil 230 miles off the  coast of Rio de Janeiro after subcontractor Transocean’s drilling caused cracks in the sea floor.

Brazilian authorities have said they may prosecute employees, shut operations and exact more than $10 billion in fines after the leaks at the Frade field.

Brazil has imposed multi-million dollar penalties on both companies for their inadequate responses to the spill, and suspended their operating licences.Some governments are taking a more robust approach to offshore regulation since BP’s Gulf of Mexico disaster. For an industry that has remained conveniently out of sight for decades, the political pressure comes as an unwelcome surprise. Nansen Saleri of Quantum Reservoir Impact LLC, told Bloomberg:

“Those countries who choose to go on a very punitive path at the end will suffer the negative consequences themselves,”

With respect to Saleri, who incidentally worked for Chevron (1974-1992), and has been involved in drilling projects in the Gulf of Mexico and West Africa, it is unlikely that investors will be walking away from an estimated 5 to 8 billion barrels of oil in Brazil’s newly discovered Tepi field, in the so-called “pre-salt” oil basin. The Brazilian government is right to require higher environmental and safety standards and to punish those companies in breach. A $10 billion fine is probably one of the most effective means of ensuring that the highest standards are met and deepwater disasters are prevented from happening again.

Will Nigerian regulators do the same? As I’ve argued elsewhere, the token penalties currently imposed by the Nigerian government have little or no impact on multinationals with notoriously low standards. Companies have exploited lax regulations for decades, and local communities have suffered the consequences. Serious penalties that are properly enforced could stem the tide of daily oil spills, regular accidents and safety breaches. Multinationals and their subcontractors should be made to bear the cost of their own mistakes. Ultimately, regulation could also save lives.

Jonathan said the country has been running on a deficit budget because the institutions that are supposed to protect public resources and prevent leakages have collapsed.

He said his office has been turned into a regular consultation room for ministers because systemic rot made it impossible for them to operate independent of the presidency.

The president said even doctors, who are supposed to protect lives, sometimes end up killing people and nobody takes action because the institutions that should monitor their activities have also collapsed.

These issues are related to the impact of the discovery of oil, and the consequent dwindling of non-petroleum sectors such as agriculture and manufacturing.Nigeria relies on oil for over 89.4% of its total revenue. This overwhelming dependency on oil has created an economy based on rent rather than productive activity, corruption over public service, and a polity that does not rely on its citizens (and crucially, their votes), to survive. While the national elections in April 2011 marked an improvement on the blatant fraud of 2007, there were still widespread irregularities, especially in rural areas. It will take more than credible elections to cure Nigeria’s oil curse.

While the relationship between political and business elites is complex, Nigeria’s oil dependence has enabled multinational companies to act with impunity, exploit lax government regulations and get away with appalling abuses, from gas flaring to oil spills, that would not be tolerated elsewhere. Oil companies, like Shell, Chevron and ExxonMobil have benefited from political instability. Rather than harming business, Nigeria’s chaotic and ungoverned politics has opened the  for massive gains, fraudulent accounting and operational cost cutting. As ruling elites and companies benefit, over 70% of Nigerian citizens suffer below the poverty line.

Functioning government institutions are urgently needed in Nigeria to prevent the daily corruption and abuse of human rights that lie at the root of conflicts in the North and South of the country. But President Jonathan, in yesterday’s speech, was short on concrete proposals.

Royal Dutch Shell has been sued so many times over its conduct in Nigeria that its cases offer a laboratory experiment for human rights litigation.

After thirteen years of arduous U.S. alien tort litigation, Wiwa v. Shell resulted in a piddling $15.5 million settlement in 2009. Kiobel v. Shell has done even worse. Nearly a decade after the case was filed, it has succeeded only in abolishing the corporate alien tort within the Second Circuit, and if the U.S. Supreme Court accepts cert, it may do the same nationwide.

Now comes the “Bodo” case, which emerged from obscurity three weeks ago. On August 3, four months after farmers and fishermen from the village of Bodo filed a common law complaint in London high court, Shell’s Nigerian subsidiary admitted liability for a pair of oil spills in return for the parent company’s dismissal from the suit. The Financial Times trumpeted the potential for a payout of over $400 million, although the Shell Petroleum Development Company called this number “massively in excess of the true position.”

As Goldhaber makes clear, the Bodo case is far from over.

the Bodo deal was not a one-sided plaintiffs victory. Corporate formalities matter intensely to both Shell and its human rights critics. As Dutch plaintiffs lawyer Liesbeth Zevgeld has put it, “Shell headquarters believes it is untouchable, but we believe it is legally responsible for damage caused in Nigeria.”  More generally, parental liability for the conduct of foreign subsidiaries has been called the leading legal question in European business human rights. With Royal Dutch’s dismissal from the Bodo suit, that battle shifts to the impending Dutch trial of Oguru v. Shell, which seeks the cleanup of three oil spills elsewhere in the Niger delta. The stakes may be somewhat lower in the Netherlands, because Dutch courts lack the sort of class action rules that let U.K. lawyers aggregate 69,000 villagers’ claims for loss of livelihood.

Read the full article here.

“NEITI does not see the rationale for passing a bill that is designed to reduce government revenue from petroleum operations by a minimum of $3 billion annually through inappropriate and unfavourable adjustments to the fiscal provisions,” the agency said in a statement.

“Sadly, the House of Representatives Report establishes fiscal terms with a government share of oil revenues below internationally competitive levels and with a structure that will result in a rapid erosion of government petroleum revenues during the next 5 years.”

Here’s some background to the story.

This chart shows the split of revenues under Joint Venture oil agreements in Nigeria. Oil companies claim costs, (often at inflated rates) and cash flow (C/Flow), while the government claims Tax, Royalty and NNPC cashflow.

The PIB, presented to the National Assembly in2008,  is Nigeria’s attempt to re-structure its embattled oil industry, primarily to resolve long-standing funding issues and incorporate NNPC, the national oil company. However, the Bill has been subject to substantial mission creep, and could eventually affect a wide range of issues from fiscal terms, gas flaring to host community rights.

Earlier drafts of the PIB included a proposal to increase in the taxes and royalties due to the state, (known as state “take”). Oil companies such as Shell, Exxon Mobil and Chevron have fought long and hard to defeat such an increase in taxes. Anne Pickard, the top Shell executive in West Africa, boasted of infiltrating government ministries, and spoke of using the US Embassy as a “silver bullet” to kill off offending terms in the PIB. Companies argued that the increase in taxes would make Nigerian oil industry uncompetitive, and drive business elsewhere. Uncertainty over the new fiscal terms in the PIB was said to be blocking $60 billion in oil investment.

In a country dependent on oil for 85% of total government revenues, oil companies wield immense power and influence. Under such pressure, lawmakers at the House of Representatives are now proposing to downgrade Nigeria’s tax regime below internationally competitive rates. Far from increasing taxes on oil companies, they now plan to drop taxes even lower.

For those following the oil industry, it’s a familiar story. A host country attempts to change the rules governing its oil industry to increase the state share of profits from its natural resources. Deals signed under dictatorship or occupation, are seen in the cold light of day to be unfair and exploitative. But multinational companies unanimously oppose any changes. Heavy political  lobbying, scare tactics and histrionics follow, with companies claiming that even minor increases in the state’s take will lead to the industry crumbling and a massive exodus of foreign investors.

Ultimately, when the rules do change and the taxes on oil companies rise, everybody returns to business as usual and profits remain high. The exodus never seems to get off the ground so long as there’s crude oil beneath it.

My heart is beating?

Many times she sang those words, wrapping up the pain and endurance of Niger Deltans, for years she shook the wall of indifference around her, and finally, we were moved.

On 1st October, NNEKA was awarded this years’ MOBO (Music of Black Origin) prize for best African Artist. NNEKA is an artist of rare achievement, whose outspoken views about the exploitation of the oil-rich Niger Delta burns deep into her lyrics. Her music has lifted the Niger Delta struggle into powerful songs,  charging the airwaves of the BBC and the UK Top 40 with her politics.

Her story begins far away from the media spotlight in the oil-city of Warri, in the Niger Delta. A few years after she arrived on the European music scene she is now clocking up +1.5 million hits on her new music video, ‘Heartbeat’. NNEKA’s success has heightened her awareness of the development denied to her people in the Delta, in spite of the oil wealth extracted from the region.

A long-time supporter of the Niger Delta cause, and a headline artist at remember saro-wiwa events, NNEKA takes every opportunity to remind the West of the heavy cost of Nigerian oil, heaping criticism on the destructive impact of companies like Shell, Chevron and the Nigerian government.

As the BBC reports:

The singer says her influences include Nigeria’s iconic Afro-beat performer Fela Kuti as well more contemporary acts like a US rapper Mos Def.

She also cites Nigeria writer and human rights activist Ken Saro-Wiwa as an inspiration. Mr Saro-Wiwa was executed by the Sani Abacha government in 1995 for his efforts to campaign against corruption in the oil-rich Niger Delta.

“Stand up against; corruption, against injustice, against bribery and hypocrisy…….RAISE UR VOICES,” she says on her MySpace page.

The government estimates as many as 20,000 militants could participate in the programme… Under the plan, the screening of gunmen and collecting of weapons will begin on Aug. 6 at 15 amnesty camps located in Delta, Bayelsa, Rivers and other southern states in the Niger Delta. [President] Yar’Adua was expected to ask state governments in the Niger Delta, oil companies and international organisations to share the costs of the amnesty programme. It was not clear how much money was needed.

The cracks have already begun to show, and the unclarity of the government’s message was met with consternation by the Ijaw Elders and Leaders Forum. The Nigerian news service, NEXT, reported that:

Ijaw leaders have queried the offer of amnesty to Niger Delta militants, pointing attention to section 175 (1) (a) of the 1999 Constitution. According to them: “there has been no conviction against any of the alleged militants to warrant the granting of amnesty.”… The forum noted that that seven months after the submission of the report of the Technical Committee on Niger Delta, the Federal Government had taken no concrete step to implement any of its recommendations.

Despite the fact that the Nigerian army still occupies the region, militants have retaliated by blowing up pipelines and oil infrastructure belonging to Shell, Chevron, Agip and Exxon, a move which helped push the world oil price up to $69. Come 6th August, the government may be less optimistic that insurgents from the main militant group, the Movement for the Emancipation of the Niger Delta (MEND) will be getting in line to handover their weapons.

Urgent action is needed from all sides to halt the killing of innocent civilians. The conflict is exacerbated by the joint failure of multinational oil companies and the government to respect the rights of local communities, many of whom suffer the daily impacts of gas flaring and oil spills on their land and health. A better way to fight the cycle of violent conflict is to address people’s long-standing grievances: invest urgently in local development and povery alleviation, compensate communities for violations of their rights and enforce protection of the environment.