Society
The big African oil grab
Published 10 April 2008
Observations on Equatorial Guinea
The government of Equatorial Guinea is getting good value from the imminent trial of Simon Mann, the Old Etonian mercenary accused of leading a failed coup attempt there. He appeared on British television last month to confess - under the watchful eye of officials from Equatorial Guinea - that conditions in the country weren't as bad as he had been led to believe. Then, to the delight of journalists captivated by this Dogs of War tale of conspiracy and cock-up, the government said it wanted to arrest Sir Mark Thatcher, son of the former prime minister.
So far, so Frederick Forsyth. But a more interesting and important tale remains largely untold. In this parallel narrative, Equatorial Guinea's president, Teodoro Obiang Nguema, has skilfully used Mann and his men to obscure the murky relationship between an energy-hungry world and important sources of new oil. No wonder a journalist colleague with long experience of West Africa describes the alleged coup attempt as "the best thing that has ever happened to Obiang".
Equatorial Guinea sits at the heart of a deepwater corner of the Atlantic Ocean that is of growing interest to governments from Washington to Beijing. For the US, the Gulf of Guinea is the linchpin of growing sub-Saharan African oil production. Not only is it a bulwark against the troubles in the Middle East, it is also forecast to provide a quarter of US crude oil imports by 2010. China and other emerging economic powers also see an opportunity to muscle in, attracted by promises of big infrastructure projects and a relationship that is free of the colonial baggage carried by westerners in Africa.
US multinationals such as ExxonMobil, Amerada Hess and Marathon Oil have, for some time, had Equatorial Guinea handily locked down, pumping more than 350,000 barrels a day. However, this has brought with it certain presentational problems, relating to Obiang's failure to run his country in a way America's Founding Fathers would have approved of.
The best argument to be made for Obiang is that he is not as bad as his predecessor and uncle Francisco Macias Nguema, who declared himself the country's "unique miracle" and under whose rule one-third of the population was killed or driven into exile. Since overthrowing Macias in 1979, Obiang has done his best to keep family traditions alive, supervising a fiefdom in which corruption and torture are reported (including by the US state department) to be commonplace.
The regime's squandering of billions of dollars of oil-boom money has given Equatorial Guinea a dubious development distinction. It is the country with the third-largest gap between income levels and the UN Human Development Index ranking for quality of life. In other words, in terms of using its wealth to benefit its people, it is one of the world's worst countries.
This is the context in which Mann has proved such a useful and distracting idiot for Obiang and his US allies. A few months after he and his alleged coupmongers were arrested in March 2004, the US Senate's sub-committee on investigations published a stinging report, which accused oil companies of entering into myriad business relationships with the regime and making "substantial payments" to government officials.
In one deal being investigated by the US Securities and Exchange Commission, Amerada Hess leased a property from a 14-year-old male relative of Obiang's. Yet, instead of facing international opprobrium, Obiang has achieved an extraordinary rehabilitation, using the alleged coup attempt to present Equatorial Guinea as a victim of outsiders' machinations.
Paul Wolfowitz, in the midst of his abortive anti-corruption drive as World Bank president, said he was "very impressed" by the leadership of what many campaigners see as a kleptocracy. In 2006, the US secretary of state, Condoleezza Rice, welcomed Obiang to Washington and described him as a "good friend" of the US. The cocktail of diplomatic doublespeak, corporate complicity and mass poverty is familiar to those who know the countries around Equatorial Guinea.
In Gabon, the corrupt relationships between French interests and President Omar Bongo's government led to the jailing of senior officials of the Elf oil company in 2003. In Nigeria, Africa's largest oil producer, investigators from the US, Britain and Switzerland are probing a $170m alleged bribery case involving Halliburton and its partners in the construction of a multibillion-dollar gas plant. One oil executive told me the big companies working in the region were finding it tough to "get the shit out of our system" while at the same time fending off rivals from China, India and elsewhere.
The grab for West Africa's resources makes it hard to be optimistic about the huge windfalls generated by oil at $100 a barrel. The corrupt - and corrupting - relationships between the world's economic powers and the region seem an echo of an era when European slave ships first cast anchor.
Michael Peel is a former West Africa correspondent for the Financial Times. His book "Delta: Nigeria and the Battle for Oil" will be published later this year
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