Lessons Learned from the Niger Delta

What failures in resource-rich places like the Niger Delta can teach us.
By: /
June 21, 2012

People living in areas of mineral and hydrocarbon production often suffer from the debilitating impacts of pollution, poverty, and repression. Based on decades of experience in places like the Niger Delta and many other parts of the world, there is a wide and growing body of knowledge about what does and does not work to improve the record of extractive industries.

In the Niger Delta, people have suffered for decades from devastating pollution and human-rights violations caused by the activities of oil companies. Solutions to these problems are not hard to prescribe: They include replacing oil pipelines and flow stations to reduce oil spills, finally ending the harmful practice of flaring sour (hydrogen sulphide) gas, and curbing the reliance on rough local security contractors.

Unfortunately, the corporate social responsibility policies that are being introduced, in the Niger Delta and elsewhere, result in little discernible difference to this crisis. Extractive companies are spending heavily on local development projects, but the quality of projects is low and their methods are ineffective.

As home to 75 per cent of global mining and exploration companies, Canada has considerable leverage and could establish itself as a global leader in responsible and sustainable extraction.

What are some alternative policies that Canada should pursue?

First, there should be a focus on strengthening monitoring and oversight of companies operating abroad, especially through an enforceable legal framework for corporate conduct. The responsible mining bill, C-300, which was defeated in Parliament in 2010 after intense industry lobbying, would have been a useful step in this direction.

Second, Canada should work directly with community organizations to support them in their efforts to negotiate with mining companies. Mining companies are formidable global players and do not need the Canadian government’s support. Local communities, by contrast, often struggle to make their voices heard. In most places, advocacy networks already exist and are often linked closely with civil-society groups in Canada. Public policy could easily capitalize on those interactions. This would go a long way towards helping communities obtain a just share in natural-resource revenues.

Yet, in a recent shakeup of its foreign-aid portfolio, Canada instead staked its response to the urgent problems created by extractive industries on voluntary arrangements with the private sector. Significant aid resources are being allocated to development projects implemented in partnership with mining companies and funding for research on corporate social responsibility.

This approach relies too much on the goodwill of companies and creates little incentive to change operational practices. There is a proliferation of community-development and corporate social responsibility projects, but the quality of development projects is often low and the methodology used for implementation is flawed. Meanwhile, the funds earmarked for development activities frequently support cronyism, helping entrench a status quo that is harmful to local populations.

There are many tools available to effect positive change in local communities. Rapid improvements can be achieved through relatively straightforward interventions.

First, investments in environmental protection would improve human health and agricultural livelihoods by reducing pollution. This would also prevent conflict, because local people would no longer be forced to compete for company resources as the only means to ensure survival. The technological prerequisites generally exist, but sometimes require considerable expenditure.

Second, the focus of development needs to be less on aid projects and more on creating employment, especially through infrastructure development. Infrastructure projects are typically constructed by company contractors using minimal local labour. Instead, contractors should be required to use the labour-intensive construction methodologies that are standard practice for aid agencies working in post-disaster reconstruction efforts.

Finally, companies need to ensure that their development activities are well designed and effective. Aid agencies have developed numerous community-driven policies to help improve the responsiveness of projects to local development needs. Proper application of these methods will improve the impact of community projects on local poverty and help reduce conflict.

Photo courtesy of Reuters