Oil Companies Pull Out of African Oil Project

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

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11/12/99

OVERVIEW & COMMENTARY

Royal Dutch/Shell and Elf Aquitaine have withdrawn from a pipeline

project in Chad and Cameroon over environmental and political

concerns. This represents a victory for highly vocal opposition to

the project.

g.b.

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RELAYED TEXT STARTS HERE:

ITEM #1

Title: ON ANNIVERSARY OF NIGERIAN EXECUTIONS,

SHELL, ELF PULL OUT OF AFRICAN OIL PROJECT

INDUSTRY ANALYSTS CITE ENVIRONMENTAL,

POLITICAL CONCERNS BEHIND MOVE

Source: Rainforest Action Network

221 Pine Street #500

San Francisco, CA 94014

Telephone: 415/398-4404; fax: 415/398-2732 Website:

http://www.ran.org

Press contacts:

Mark Westlund, ranmedia@ran.org

Erick Brownstein, osani@ran.org

Date: October 10, 1999

ON ANNIVERSARY OF NIGERIAN EXECUTIONS,

SHELL, ELF PULL OUT OF AFRICAN OIL PROJECT

INDUSTRY ANALYSTS CITE ENVIRONMENTAL,

POLITICAL CONCERNS BEHIND MOVE

"Based on its experience in Nigeria, Royal Dutch/Shell recognizes a

bad situation when it sees one, and Elf Aquitaine will avoid becoming

part of the tragedy. The human and environmental costs of proceeding

with an oil pipeline that cuts through the heart of Africa's

rainforest are simply too great. The question remains whether The

World Bank and Exxon will see the situation in a similar light."

- Erick Brownstein, African Rainforest Campaign

Initial reports explaining the decision of Royal Dutch/Shell and Elf

Aquitaine to withdraw from a pipeline project in Chad and Cameroon

indicate that environmental and political concerns may have been

overwhelming. Yet despite continued criticism from forest protection

and human rights leaders who question the project's environmental

safeguards and see little benefit for the local populations, The

World Bank and Exxon have indicated they hope to see the project

continue.

Shell's announcement came on the eve of the fourth anniversary of the

execution of Nobel Prize nominee Ken Saro-Wiwa and eight others

opposed to Shell's operations in Nigeria. "Shell's withdrawal from

Chad and Cameroon is an eerie homage to Ken Saro-Wiwa," observed

RAN's African Rainforest campaigner Erick Brownstein. "Now it is up

to The World Bank's James Wolfensohn to live up to high expectations

and determine whether this is the right kind of project for U.S. tax

dollars to fund."

The African Rainforest Pipeline project will slice through the heart

of pristine rainforests, and will put hundreds of millions of dollars

into the pockets of Exxon and two corrupt governments. Transparency

International recently rated Cameroon the world's most corrupt

government for the second year in a row, and southern Chad is so

dangerous and politically unstable that neither Amnesty International

nor the US State Department was able to visit and confirm the

massacre of hundreds of people. A 1999 US State Department report on

Chad shows a government engaged in indiscriminate human rights

abuses.

"Poverty in Chad and Cameroon is devastating and should be a concern

for all of civil society," said Brownstein, "but giving billions of

dollars to a huge oil company and to governments that are unable or

unwilling to help their people will only exacerbate the problem."

ITEM #2

Title: Chad slams Shell/Elf decision to quit oil project

Source: Reuters

Date: November 10, 1999

N'DJAMENA, Nov 10 (Reuters) - Chad said on Wednesday that a decision

by Royal Dutch/Shell Group (quote from Yahoo! UK & Ireland: SHEL.L)

and Elf Aquitaine to pull out of its oil extraction and pipeline

project was both unexpected and questionable.

Communication Minister and Government Spokesman Moussa Dago told

state radio that the government reserved the right to take legal

action over ``an improper breach of contract compromising the higher

interests of the Chadian nation.''

The project, billed by the government as the key to development in

the landlocked and impoverished nation, has run into strong criticism

from pressure groups who say that there are not enough environmental

safeguards and too little benefit for the local populations.

``The Dutch company Shell and the French company Elf have

unexpectedly made known their decision to stop funding the Doba oil

project in southern Chad,'' Dago said.

``The sudden nature of these decisions suggest that they are not

dictated by economic or technical considerations,'' he added. ``This

pullout, in reality, seeks one thing, namely compromising the Chadian

oil export project and creating problems for the government with its

public opinion.''

Shell and Elf have yet to comment publicly on the decision but the

World Bank and Exxon Corp (NYSE:XON - news), which is leading the

project, have both said that they hope it will still go ahead. The

World Bank board was to have reviewed the project shortly.

Doba described the project, which had envisaged exporting oil via

Cameroon in 2001, as essential for Chad's and the region's economic

development and said that the government would do everything it could

to ensure it went ahead.

``The government has decided to take a direct hand in looking for new

partners to conclude the project within a reasonable timeframe in

concertation with the government of Cameroon and the American company

Exxon,'' he said.

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