Law and Order

Oil Hearing to Cast Spotlight on West Africa

WARRI, Nigeria—Olubunmi Akindele mans the shaky front line of West Africa’s losing battle with its oil spills.

Sitting in his small office here on a recent day, Mr. Akindele, a regional head of Nigeria’s National Oil Spill Detection and Response Agency, fielded two calls in 45 minutes from villagers reporting different spills nearby in the oil-rich delta. Finishing one call, he telephoned a Western oil company’s local office to pass word of a leak at its facility, asking them to follow up themselv

Villagers pointing out oil in a river in the Ogoni region of Nigeria’s Niger Delta last summer. Oil firms blame spills on militant groups that divert oil.

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With a small budget and access to a single oil-dispersement plane based in another country, his agency has almost no means to respond to near-daily spill reports. “You can’t just go out to the creeks every time someone calls,” Mr. Akindele said.

International environmentalists and lawmakers are looking nervously to West African oil-patch countries including Nigeria and Angola, where watchdog groups say a near epidemic of unaddressed spills is the result of either lax regulation, pipeline vandalization by groups seeking to divert oil for their own profits or an underprepared spill-response effort.

Some of these people fear the situation could worsen as oil exploration moves from the swamps and shallows of places like Nigeria’s Niger Delta. In deeper water, security concerns are lower, replaced by the risks that come with the more complex techniques required for these larger, deeper reservoirs.

On Jan. 26, lawmakers in the Dutch Parliament are preparing to question Royal Dutch Shell PLC about years of spills in the Niger Delta. The exchange is expected to highlight West Africa’s lack of preparedness for almost any kind of spill, much less a huge accident like the one at a BP PLC deepwater well in the Gulf of Mexico in April.

“BP has shown a giant spill in the Gulf of Mexico is possible in deep water,” said Joseph Croft, executive director of Nigeria civic rights organization Stakeholder Democracy Network. In West Africa, he said, where “health, safety and the environment are not at the forefront [of government priorities], it is not only possible, but more likely.”

West African countries have some of the world’s least rigorous regulatory schemes, watchdog groups say. In Angola, which has large deep-water reserves, local fishermen complain that companies are left to handle spill oversight. The country, which has had an offshore oil industry since the 1960s, adopted a national response plan two years ago and critics say it hasn’t adapted its regulations in the aftermath of the U.S. Gulf disaster.

Ghana, which just started oil output from its massive offshore Jubilee field, is a relative newcomer with unclear offshore oil and gas regulation, said Alex Vines, head of Africa Program at U.K. research institute Chatham House. “I don’t see that Ghana is ready for production,” he told a recent oil conference.

Angola says it is considering increasing inspections and fines on foreign oil companies. An official with Ghana’s Environmental Protection agency says the country has the capacity to respond to an emergency.

The acting director of Nigeria’s National Oil Spill Detection and Response Agency didn’t respond to requests for comment. The Minister of Environment in Nigeria, John Odey, didn’t respond to requests for comment.

West Africa’s oil production has historically been from onshore or shallow-water fields that call for exploration methods that have been tested since the oil industry’s early days.

For decades, swamps in Nigeria’s oil-rich Niger Delta have been beset by thousands of spills. Last year, the spill-response agency said it had recorded about 2,405 oil spills involving all the major international oil companies operating in Nigeria between 2006 and June 2010.Nigeria doesn’t disclose the overall amount of oil spilled.

Anglo-Dutch oil giant Shell says the vast majority of the pollution in its Nigeria operations in recent years has been caused by oil theft and militant attacks. For its Nigeria operations, it says an equivalent of 102,000 barrels of oil were spilled into the Niger Delta in 2009 as a direct result of sabotage or theft. That is close to half the equivalent of 257,000 barrels spilled in Alaska’s 1989 Exxon Valdez spill.

West Africa’s appeal has grown since BP’s troubles with the Deepwater Horizon, as some rigs idled by last year’s temporary U.S. drilling freeze departed the Gulf of Mexico for Africa.Transocean Ltd.’s Marianas rig—which preceded the ill-fated Deepwater Horizon on BP’s Macondo well in the Gulf—recently moved to offshore Nigeria.

Big regional producers Nigeria and Angola together held 50.7 billion barrels of proven oil reserves as of end 2009, nearly twice as much as the U.S. and its 28.4 billion barrels. A large share of those reserves are deep offshore.

While BP says it and the U.S. government marshaled an armada of 6,000 ships and 100 aircraft to battle the Gulf spill, West Africa’s standing response team consists of a single small plane, based in Ghana, and a few boats, according to the Global Initiative for West and Central Africa, an international partnership of oil companies and watch groups.

The plane is positioned to immediately disperse the equivalent of 280 barrels to 560 barrels on each flight, said Archie Smith, chief executive of Oil Spill Response Ltd., an industry body financed by the industry to respond to spills. Mr. Smith added that his own company could mobilize four larger aircraft coming from outside Africa.

In Mr. Akindele’s office in Warri, the oil hub of the Western part of the Niger Delta, one of the calls fielded on a recent day by the official was from a citizen reporting oil pollution from a nearby Chevron Corp. facility. Mr. Akindele replied that the government would send a team “as soon as Chevron does a flyover and confirms it.”

Chevron later said it did reconnaissance flyovers but that spills were issuing from another company’s pipeline.

Fines and penalties for spills in West Africa are relatively modest. In the U.S., any company failing to notify authorities of an oil discharge is given a one-time fine of $500,000, and other penalties may accrue. Egypt levies a one-time fine of at least $52,000 if a spill isn’t disclosed “promptly.” The fine in Nigeria is about 500,000 Nairas ($3,200) per day of delayed disclosure.

Regulators in West Africa are often badly paid, unskilled and unmotivated. The budget for Nigeria’s National Oil Spill Detection and Response Agency, which is in charge of pollution inspections, was $3.39 million in 2007, the latest year available for approved expenditures. That’s roughly 3% of the amount budgeted for audits and inspections at the agency’s U.S. counterpart.

The agency is a “watchdog without teeth,” said Ben Amunwa, a researcher at U.K. environmental group Platform.

“People in Nigeria are outraged that in the U.S. there is such [a comprehensive] response to oil spills,” said Geert Ritsema, the international coordinator at Friends of the Earth Netherlands. “Show me where are an oil spill has been properly cleaned. There is no such place in Nigeria.”

Write to Benoit Faucon at benoit.faucon@dowjones.com

Anthony-Claret Onwutalobi
Anthony-Claret is a software Engineer, entrepreneur and the founder of Codewit INC and CEO of Portia Web Solutions. Mr. Claret publishes and manages the content on Codewit Word News website and associated websits. He's a writer, IT Expert, great administrator, technology enthusiast, social media lover and all around digital guy.
https://www.codewit.com

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