Bush-Cheney Energy Plan Could Aggravate Ethnic Conflicts

With its strong emphasis on increasing global supplies of oil and gas, the Bush administration's energy plan--which Congress began debating this month--could aggravate latent or ongoing ethnic conflicts in West Africa, Central Asia and the Caucasus, South America, and Southeast Asia.

In most of these regions, ethnic tensions are already high and, in some cases, have escalated into armed conflict. Yet the administration's plan, entitled Reliable, Affordable and Environmentally Sound Energy for America's Future, fails to mention these problems in its analysis of overseas prospects, suggesting a myopia that could have devastating consequences in the long run.

Recent history has shown that abundant energy resources are at least as much a curse as a blessing for poor nations with large populations. In cases ranging from Angola to Iran, and from Indonesia to Nigeria, big export earnings from oil and gas generally have failed to trickle down to the vast majority of the population, let alone to disadvantaged ethnic minorities forced to endure the environmental damage caused by resource exploitation.

By calling for stepped-up efforts to extract and transport more oil and gas from these regions, the Bush-Cheney energy plan risks aggravating local conflicts in three main ways.

First, its emphasis on supply will encourage exploration and production everywhere there is a hint of energy waiting to be tapped--including in increasingly remote regions, such as indigenous lands in Brazil, Venezuela, and Colombia, which have acted as a refuge for minorities who are hostile to--or unprepared for--the kinds of transformations that large-scale energy projects bring.

Second, minorities on whose land energy resources are found often have been denied their fair share of profits, increasing tensions and anger directed against the central government and the companies, as in the Niger Delta region of Nigeria.

Third, the foreign investment that makes energy exploitation possible is often tied by the U.S. government, World Bank, and International Monetary Fund (IMF) to the host government's adoption of free-market economic policies, such as privatization, which frequently create or widen gaps between rich and poor within countries. As a result, minority communities that may already suffer economic marginalization could find their situation reduced even further vis-à-vis other groups, or communal tensions within countries may rise as austerity associated with liberal reforms takes hold. (Thus, for example, pressures on federal and state budgets in the former Yugoslavia in the 1980s played an important role in the country's bloody dissolution.)

One or more of these factors applies to virtually all of the areas targeted by the plan.

West Africa: Niger Delta peoples' struggles against the Nigerian and state governments and foreign companies, including Shell and ExxonMobil, have resulted in considerable bloodshed over the past decade. In June, local communities assailed the World Bank's International Finance Corporation for approving loans to local commercial banks that would then lend the money to Shell contractors. Shell is being sued in U.S. courts for alleged complicity with the military government in the 1995 arrest, trial, and execution of nine activists from the Ogoni community. Even under the elected government of President Olesegun Obasanjo, the region has remained under virtual occupation. In 1999, Nigerian security forces razed an Ijaw community of 15,000 (Odi) killing dozens of unarmed citizens. Oil revenues and their regional distribution remain a source of great contention in the broader national conflict among the country's three largest ethnic groups, the Hausa-Fulani in the North, the Yoruba of the West, and the Igbo in the South. Washington has provided training and equipment for Nigerian troops since Obasanjo took over.

Other countries to which the administration is looking to increase global supplies are also riven by conflict. The ruinous conflict between Angola's ruling MPLA party and Unita rebels, much of it based on underlying ethnic divisions, dates from the cold war. While Unita relies on its ability to recruit from its Ovimbindu base to continue the war, the inhabitants of oil-rich Cabinda enclave have sought independence from Luanda for some 40 years. Chevron, Texaco, and ExxonMobil all have investments in Angola.

Meanwhile, the latest entry into the regional oil rush--apart from tiny Equatorial Guinea, which has its own ethnic problems--is Chad, where ExxonMobil, Chevron, and Malaysia's Petronas are building an oil and gas pipeline to Cameroon's Atlantic coast with the help of World Bank and U.S. Export-Import Bank financing. ExxonMobil has acknowledged that security concerns in Cameroon played a role in its decision to opt for an offshore storage and distribution facility. Pipelines will run through ecologically sensitive rainforests, the last refuge to the Baka Pygmy people. Although Chad is currently peaceful, its northern- and Muslim-dominated central government has long had an uneasy relationship with the mainly Christian southerners, some of whose political leaders were arrested after recent elections, prompting barely a peep of protest from Washington.

Central Asia and the Caucasus: The Bush-Cheney plan devotes considerable attention to this region, whose proven oil and gas reserves exceed those of the North Sea. Among the U.S. companies with major investments there are ExxonMobil, Chevron, BP Amoco, and Phillips Petroleum. Washington showed a strong interest in the region's energy resources during the Clinton administration, which began building extensive military ties with some of the new states--despite rising tensions among them, some due to ethnic problems.

In addition, the energy plan strongly endorses construction of the controversial Baku-Tblisi-Ceyhan (BTC) pipeline, which would pump Kazakh and Azeri oil and gas all the way through Azerbaijan, Georgia, and across Turkey to its main Mediterranean port. The pipeline would traverse ethnically explosive territory. Nagorno-Karabakh, an Armenian enclave in Azerbaijan, has been the site of bloody fighting between Armenia and Azerbaijan over the past decade, for example, while Georgia, which borders Chechnya, has suffered two ethnic rebellions in Abkhazia and South Ossetia over the same period. The pipelines would also pass through much of eastern Turkey, where a protracted conflict with Kurds has taken thousands of lives.

The administration has become deeply involved in peace talks over Nagorno-Karabakh. It continues to provide military aid to Georgia and appears intent on maintaining strong military ties with Turkey, one of its closest NATO allies.

Algeria: According to the energy plan, Algeria, along with several Persian Gulf states, is a major target for efforts to "open up … to foreign investment" and expand trade in energy-related goods and services. Significantly, President Abdelaziz Bouteflika became the first Algerian head of state in 15 years to be greeted at the White House in July, just a month after unprecedented clashes between security forces and the minority Berber population in the depressed Kabylie region resulted in scores of deaths. Although the meeting was low profile, Bush and Bouteflika discussed increased U.S. investment in Algeria's oil sector and enhanced military cooperation.

South America: Similarly, the plan speaks of working ''to improve the energy investment climate'' in Brazil and Venezuela. As elsewhere in South America, particularly Colombia and Ecuador, much of the remaining reserves of oil in these countries are found within territory settled or claimed by indigenous groups who, particularly in the Andean region, have become increasingly insistent about their rights.

Southeast Asia: The plan highlights the need to build Asian reserves but focuses primarily on regional giant India, which has asked for help to maximize its domestic oil and gas production. Virtually ignored in the report are two key regional producers--Indonesia and Burma (also known as Myanmar)--where U.S. companies have important investments.

Production in both countries has proven problematic, particularly because of ethnic conflicts directly related to energy company operations. In Burma, a pipeline to pump gas from the Andaman Sea to Thailand traverses territory occupied by minority groups, many of which have been in rebellion for much of the country's history. In order to ensure the pipeline's construction, the Burmese army occupied villages along its route and forcibly drafted civilians into work crews. California-based Unocal, one of the companies involved in the project, has been sued in federal court for complicity in the abuses.

A similar suit was filed last month against ExxonMobil for its alleged cooperation with the Indonesian army in abuses against people in Aceh, the country's most important oil-producing province and now the center of its most threatening rebellion. A low-level insurgency launched in 1977, the conflict has become particularly deadly over the past two years--so much so that ExxonMobil suspended operations last March due to growing security concerns. Jakarta has since reinforced troops in the region, and the Indonesian government and the state's oil company, Pertamina, have asked that the U.S. energy corporation resume operations in Aceh.