Shell oil infiltrates Nigeria’s government ministries

Shell oil infiltrates Nigeria’s government ministries

If you want to make some enemies in Nigeria, just say you’re from Shell — especially after Wednesday’s WikiLeaks release. Cables from 2009 and 2010 indicate that the oil company — the firm with the longest history and the most tarnished reputation in Nigeria — has infiltrated government ministries, speaks of its Nigerian colleagues as amateurs, and seems to have U.S. diplomatic help in pushing its agenda through the national assembly.

Shell has been operating in Nigeria since 1936, and over the decades, it has been the most prominent international oil company operating in the resource-rich Niger Delta. Its mishaps are almost as old, but things took a particular turn for the worse in the early 1990s, when Shell was allegedly complicit in the government assasination of local environmental activists who were protesting the oil pollution in their communities. Shell was kicked out of those communities and only recently let back in.

Yet in a series of cables discussing Nigeria’s Petroleum Industry Bill (PIB), an effort at sector-wide reform that has been held up in the assembly since 2008, it becomes clear just how much influence Shell still wields.

Shell — and, according to the cables, all international oil companies operating in Nigeria — are adamantly opposed to the legislation, as it stands to "reduce the corporation’s [Shell’s] overall value in Nigeria." As such, Shell told the U.S. ambassador that the company and its peers would be reaching out to diplomats from the United States, Britain, and Denmark to "convey points on the bill to GON [government of Nigeria] policymakers," a Feb. 10, 2009 cable recounts. In a meeting in October 2009, the U.S. ambassador asks "what the Embassy could do to help" with the congressional committee working on the bill. The ambassador also reminds Shell Managing Director Ann Pickard "that the U.S., U.K., Dutch and French Embassies had already made a joint call on [Nigerian national oil company] NNPC General Managing Director Dr. Mohammed Barkindo" regarding the bill. (Nigeria is was the fourth-largest OPEC oil supplier to the United States in September, the most recent month for which data is available.)

But more disquieting is the influence Shell wields within the Nigerian government. Pickard recounts direct meetings with former Nigerian President Umaru Yar’Adua as well as other top oil officials. This isn’t unexpected. But in a meeting between the U.S. ambassador, Pickard points out that Shell is able to keep tabs on the Nigerian government’s dealings with other oil partners China and Russia in part because "Shell had seconded people to all the relevant ministries and that Shell consequently had access to everything that was being done in those ministries."

Of course, there are damning revelations about the government of Nigeria’s role in the slippery oil business as well. Shell alleges in the February 10 meeting that illegal oil sales go all the way to the top of the govenment: "Oil buyers would pay NNPC GMD Yar’Adua, Chief Economic Advisor Yakubu and the First Lady Turai Yar’Adua large bribes to lift oil."

Still, the revelations about Shell will likely overshadow those pertaining to the Nigerian government — at least in Nigeria, where corruption in the government is a well-recognized fact. There, the cables will hammer one more nail into Shell’s coffin as far as public opinion is concerned. It doesn’t help that the company refers to its local colleagues in incredibly demeaning terms.  A cable recounting a Feb. 23, 2010, conversation with the U.S. assistant secretary of state for African affairs, Johnny Carson, recalls: "Amateur technocrats run the oil and gas sector according to Shell’s Peter Robinson. They believe that they can control the industry via spreadsheets and pushing through the PIB."

For a population that has lived for decades with oil — to little benefit — Shell’s political obituary writes itself.