10 09 13 The Independant (uk) : Congo kleptocrats’ obscene pursuit of wealth is about to spread to oil

As if Congo’s copper, cobalt and diamond mines had
not unleashed enough corruption already, its government is about to pass a new
law that could replicate the crisis in its fast-growing oil
industry.
Needless to say, wealthy British exploration businesses look set to
benefit. Congo’s mines have been systematically sold, on the cheap, by corrupt
officials to their preferred western contacts for many years. The deals or, more
specifically, the backhanders that allegedly push them through have enriched the
kleptocratic few at the great expense of the population of this immense, poor
country.
While a handful of men have become millionaires, poverty has
worsened since the 1980s. Despite the rising revenues from minerals sales
throughout the commodities boom, nearly half the population is below the poverty
line, and almost half those of working age are unemployed. It is an obscenity.
Where the mining wealth should be raising taxes to build more schools, hospitals
and sustainable businesses, it is too often being funnelled out to companies in
the West, shadowy offshore trusts and corrupt officials.
A report by Kofi
Annan, the former UN secretary general on the issue earlier this year estimated
that the Congolese people missed out on potential income of almost $1.5bn
between 2010 and 2012. His report highlighted and condemned the sales of assets
through the Israeli tycoon Dan Gertler to London-listed mining group ENRC –
currently in the process of retreating from the Stock Exchange after a wave of
scandals.
Mr Gertler, a close friend of President Joseph Kabila and major
player in the Congo minerals world, bought the assets directly from the state at
an allegedly knockdown price. There was no public tender allowing the market to
decide the correct price.
He then sold them on to ENRC. In the process, Mr
Annan’s organisation calculated, the Congolese nation missed out on hundreds of
millions of dollars. Both ENRC and Mr Gertler strenuously deny any
wrongdoing.
Mr Gertler has always claimed the assets were not undervalued,
but the opacity with which he runs his businesses, including what critics
describe as the use of complex offshore trusts, inevitably creates room for
questions to be asked. Mr Kabila, Mr Gertler and ENRC have come under such
widespread criticism for these and other deals that it seems astonishing that,
just as Congo’s oil industry gets going, it is passing a law that will allow
similar cloudy deals to flourish for years to come.
According to Global
Witness, the campaign group that has done more than most to understand and
expose corruption in the country, the new law will replicate most of the
appallingly lax conditions prevalent in its mining world. Mr Gertler, who last
year was reported to have bought stakes in oil exploration rights, will be
watching closely.
There is no provision for open public tenders; bidders will
be allowed to be anonymous, and oil contracts will not have to be made public.
All this secrecy despite the fact that these are the riches belonging to the
Congolese people. Meanwhile, take a look at this bit: “For reasons of public
interest, a decree deliberated in the Council of Ministers can waive the
restriction measures related to [oil exploration in] protected areas and
prohibited areas.”
It may look fairly innocuous, but that part of Article 24
is a potential environmental H-bomb. It basically means that, in order to allow
drilling in its wildlife-rich nature reserves and World Heritage Sites, all the
government has to do is hold a meeting of ministers to approve it.
The proof
that this is no small matter is already there for all to see. The Congolese
government has granted drilling rights in the Virunga National Park, home to the
rare mountain gorillas made famous by that jungle-loving trio of Dian Fossey,
Sigourney Weaver and, of course, David Attenborough.
The British Government
has joined Unesco and other European governments to oppose this plan. Yet it is
a British company, Soco International, which looks set to be the first to start
drilling under the waters of  Lake Edward.
The lake’s many species of fish,
as well as the crocodiles, chimpanzees, elephants and lions who live around it,
are highly protected by international treaties. Soco has declared that, despite
the protests of so many countries and organisations, it will press ahead with
its exploration.
It says it will work with the Congolese environmental
agencies and government to ensure the environment remains protected. However,
the oil supermajor Total, which also has an exploration licence covering part of
the park, has pledged not to explore there.
Western governments, including
Britain, which has said it will give Congo £790m in aid between 2010 and 2015,
have been slow to pick up on the new law. They should start applying pressure,
quickly. 
Congo aims to increase  its oil production from the current 25,000
barrels a day to 225,000. Global Witness estimates that could bring in revenues
of $3bn a year for Congo. So much cash, and without proper legislation to ensure
transparency, so much temptation for kickbacks.