Pipeline news

Photo by Christiane Badgley

Although the work I’m doing now in Cameroon is not directly related to the Chad-Cameroon pipeline, I’m  getting updates on the pipeline as possible.

Last week I had a meeting at the Ministry of the Environment and Conservation and learned that Cameroon is once again trying to renegotiate the transit fees it receives for pipeline use. Although most of the pipeline is in Cameroon, which means that most of the environmental risk is in Cameroon, the country benefits only minimally from the operation. Most of Cameroon’s revenues from the project come in the form of transit fees collected on the oil pumped through the pipeline. Even at the time of signing, the rate (41 cents per barrel) was low and to add insult to injury, the transit fee isn’t indexed to inflation or to the cost of oil.

In the nine years that the pipeline has been operational, Cameroon has watched the price of oil skyrocket while its meager transit fees have remained unchanged. (See my December 2010 post on the lack of transparency surrounding Cameroon’s earnings from the pipeline.)

Cameroon can’t simply raise the fees — the rate must be renegotiated with Chad and the oil companies. Over the past few years there have been several attempts at renegotiation. I’ll be looking for information on the outcome of the current discussions — it is a critical time for Cameroon to secure a better rate. Niger may use the pipeline to get its oil out of the country. The Chinese will use the pipeline to get their Chadian oil to port. Oil from northern Nigeria or the Central African Republic could also transit through the pipeline.

The pipeline will likely continue to generate revenues for Cameroon, Chad and the oil companies for decades to come. Whether the pipeline itself will be up to the task is another issue. “An accident waiting to happen,” is how one person described the pipeline to me. To date, the (known) spills have occurred at the marine loading terminal in Kribi, but several local environmentalists told me their greatest fear is a pipeline rupture inland where access is difficult (and during the rainy season nearly impossible). It is hard to fathom massive clean-up operations in regions lacking decent roads and in a country with limited emergency response capacity.

A recent article in the Los Angeles Times describes clean-up efforts and ongoing problems in Michigan following a 2010 pipeline rupture: Officials shut down 39 miles of the Kalamazoo River for nearly two years as Enbridge threw thousands of employees and contractors at the cleanup process. The workers filled local hotels and eateries as the company backed community projects, even joining the Marshall Chamber of Commerce. The company also bought about 150 homes near the spill, altering the social landscape as much as the reinvented Talmadge Creek. Shrouds of weeds now surround the oil-inundated houses of the homeowners who sold to Enbridge. The article goes on to describe lingering environmental damage and health risks, despite the massive clean-up effort.

Would a pipeline rupture in Cameroon provoke a similar response? Unlikely…Even if all the stakeholders wanted to launch a major clean-up effort, how could they?

Another area to watch now is the Lom Pangar dam construction site. With dam construction “imminent,” a section of the pipeline will soon be rerouted. When will this happen and who will pay for the work? I’ve been unable to get any answers, but have found out that the Lom Pangar Dam project, which got the green light from the World Bank in March, was extremely controversial inside the Bank. Some officials, I’m told, went as far as questioning the legality of supporting a project that is in direct conflict with a previously supported project (the pipeline).

I often discuss the pipeline’s impact in Cameroon, but it’s important to remember that the situation in Chad is dismal. This “poverty reduction” project has been a complete disaster for the local population. Today there are more than 800 wells in the Doba field area although the original project plans included only 300 (See Chad Export Project Update No. 30. Mid-Year Report 2011, p.1; available at: http://www.esso.com/Chad-English/PA/Files/30_allchapters_eng.pdf).

The increased drilling activity has led to more “locked-in villages,” exacerbating poverty. A recent report from Germany, For a Just Future, describes the situation:

“Locked-in villages”: an especially worrying situation

Villages affected include those like Maïkeri, which are in an especially worrying situation. We refer to them as “villages enclavés” (locked-in villages). There, the failure is apparent as soon as you enter the village. In the industry enclave, residents of Maïkeri and Poudouguem have difficulty coexisting with the wells, which are spread out among the homes, fields and bush. The number of wells is growing daily, even right in the center of some villages. Villages enclavés in the oil basin live in insecurity under the hold of the oil facilities. Local populations are powerless as they witness the disappearance of their ecosystems.

“How are local small farmers supposed to attend to their business in the midst of the very complex infrastructure being built in their fields? Wells, main and secondary pipelines, electric lines, pits, tracks, facilities, homes, …” These villages enclavés will eventually disappear. The result of all of this will most certainly be numerous social problems

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