We Must Be Careful With The Presence The Big Seven Sisters of the Oil & Gas World
There are seven big oil and gas companies in the world that control more than 80% of all oil and gas produced and sold in the world and they are called the seven sisters of oil and gas world . These companies are individually 100 plus years old and they are still very active in the business of producing oil and gas in most of the oil and gas producing countries of the world.
These seven sisters are Royal Dutch Shell, British Petroleum, Exxon, Texico, Total, Mobile and these names are synonymous with oil and gas development and production from the Middle East to Africa, Asia, South America, Russia and the US. Very recently, these Multinational Corporations (MNC) of Oil and Gas have entered PNG. Exxon/Mobil and Total are here especially in the development of LNG while BP, Shell, Mobile and recently Total have been in the retail part of the oil and gas business so these big seven sisters are already in PNG.
Oil and Gas corporations are very big interms of their economic value and what an individual company worth and has is more than the GDP of most of the developing and middle income countries in the world which makes them the most powerful economic entities in the world of business and politics.
Development and industrialization was, is and will be driven by energy and the demand for energy, especially of oil and gas wiIl always increase. Industrialized nations of the world have their energy policy as the central part of their economic policies and their energy policies have framed how their diplomatic and foreign policies were going to be with nations that have oil and gas. The foreign policies of the U.S in the Middle East has been to facilitate the implementation of its energy policy which saw its big oil and gas companies such as Exxon, standard oil , Texico operating at full scale in Iraq, Kuwait, Saudi Arabia, both on exploration and production.
While France has increased its exploration and production of oil and gas in her former colonies of Angola, Gabon and other East African nations through Total and Britain and Holland have their operations in Libya, Egypt, Nigeria and Sudan through BP and Shell riding on top of their foreign policies towards these countries.
Most of the oil and gas producing nations from Asia to Middle East, Russia, Africa and South America have resources laws that does not recognize people living on the land whose land has oil and gas as, land owners, so the people simply do not have any direct say and benefit on the development of the resources. The only authority foreign companies deal with to have access to the natural resources, especially of oil and gas is the government and the ministry responsible for oil and gas. So having access to these resources by the oil and gas companies is very simple and exploitation begins the moment a permit is issued to these petroleum companies. The people of these countries have become mere spectators, feeding from crumbs and have lived with the negative consequences of oil and gas development in their areas by the giant oil and gas multinational corporations (MNC).
Most of these oil and gas producing nations have not benefited from the development of their resources by these big MNCs and the nations have a lot of debts to repay and the people live very poor lives. The only people to have benefitted from these oil and gas developments seem to be a few government ministers, senior government officials, military and police heads. Military and police heads are rewarded for suppressing people uprising and for protecting oil and gas pipeline and installations while government officials and ministers are looked after for facilitating licenses and approvals of their operations.
In certain oil and gas producing regions and countries, the collusion of petroleum MNCs and government ministers and officials to exploit could not be tolerated any more by the people which led to the birth of nationalism and toppling of MNC linked governments by nationalists leaders to take back what has been lost to these MNCs. In the Middle East, Saddam Hussain (Iraq) was one such nationalist leader while in Africa, rose Muhammad Gaddafi ( Libya) and in South America, Hugo Travez ( Venuzualla).
When Saddam Hussain, Muhammad Gaddafi and Hugo Chavez came into power by over throwing the corrupt regimes in their respective countries who collaborated with the giant petroleum MNCs and exploited their nation for a long time, they immediately nationalized the oil pipelines and installations taking control of their resources. These countries started experiencing unprecedented economic development and growth after taking charge of the production of oil and gas themselves.
However, petroleum MNCs loath nationalism in the countries that they operate in and they would move very quickly to quash the movements. They do this by employing different strategies but the common one is creating division amongst the people themselves to fight each or to fight their government or with the help of their own government, accuse the nationalist government of promoting terrorist activities that would warrant foreign troops to enter these countries to apprehend the nationalist leaders and over throw the legitimate government.
What the world has witnessed recently in Iraq and Libya, the capture and killing of Sadam Hussain and Muhammad Gaddafi have the foot prints of the work of these petroleum MNCs. The uprising in Venuzualla to overthrow Hugo Travez and his eventual death reeks of the work of these MNCs. One notable thing that links the MNCs to the political and economic chaos was that soon after the death of these nationalists, the petroleum MNCs have returned to these countries to continue their operations and impoverishing the people again.
The hallmarks of the presence and stealthy instigations of the seven sisters (MNCs) of oil and gas are political and economic instability in the host countries. In the midst of chaos, they continue to produce under heavy security of their installation. The Middle East, North Africa, the capsian and Black Sea regions and South America have become hotbed of political and economic instability and in these regions, there is an heavy presence of the big petroleum MNCs.
In Papua New Guinea, we already have the presence of these same petroleum MNCs developing and operating the LNG. Exxon Mobile is operating the current LNG while Total will develop and operate the second LNG. These two MNCs are part of the seven sisters of the oil and gas world that are known throughout the world to be exploitative and ruthless.
A lot of eyebrows were raised when the government in less than 24 hours approved the first ever Exxon Mobile LNG Project in record time without identifying the real landowners and to date after three years with about 300 shipments of LNG since the maiden shipment, the land owners identification has not been concluded and their royalties have not been paid.
The government, especially the prime minister and the finance minister coming from the provinces that host the LNG project have not spoken one bit in support of the land owners and the failure of Exxon Mobile to pay royalties to both the government and the land owners. While the benefit of the first LNG project has not been fully realized, the government is already talking about the second LNG to be developed by the France petroleum company, Total. The government says that the second LNG would further push png up and bring more windfall benefits to the country but if the first meager LNG benefit to png and the landowners is of any indication, then the promise of the second LNG is only a myth not to be believed.
PNG is a special country where land owners own 97% of the land and the landowners have a stake in the development of the resources unlike other oil and gas producing countries and these rights are guaranteed by the law. Given this peculiarity,resources development in the country must take into consideration the Interest of the land owners. To further strengthen the interest of the landowners, the resource laws must be amended to give more prominence and make the land owners equal partners in the development of the resources.
PNG must move away from the experiences of other oil and gas producing countries. The country must avoid the mistake of other countries and treat every petroleum investors on equal footings with the resource owners . We must not see Exxon Mobil and Total as our friends because they don't definitely love us, they are only here for our oil and gas, therefore lets threat them on strict terms and condition.
If the government fails to treat with fairness the interest of the landowners and the people of this nation in general then no doubt, the situation will give birth to fierce nationalism and we will see the rise of Gaddafis, Hussain and Hugo in this nation.
A new window of opportunity has now opened up with the rise of Asian tigers in the oil and gas business in the likes of China's National Petroleum Company and Malaysia's Petroleum Company, Petronas. These oil and gas companies seem to play fair games in countries they are currently operating in. Since PNG is strategically located within the vicinity of the big insatiable Asian Markets, maybe it's about time PNG should look North and allow the Chinese and the Malaysians to develop the next lines of LNG to get a better deal than what the Americans, French, British and Dutch are currently operating in.