Uganda's Oil Extraction, Another Human Tragedy

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Take a moment, with Uganda brightly in the spotlight due to the Joseph Kony video by Invisible Children and the accompanying question of accuracy of it all and subsequent critique of the critique, to consider another shady issue plaguing the African nation: Oil.

Uganda doesn't spring to mind for most people when coming up with a list of the world's oil-producing nation. But, in fact, five years ago more than two billions of barrels worth of oil were discovered in the landlocked nation, where nearly 40% of the population lives on less than $1.25 a day—and as New York Times points out, inflation is around 30%.

If revenue from that oil were equitably shared, and the resource curse that has plagued the majority of poor nations who suddenly find themselves potential petro-powers avoided, it would go a long way towards reducing that rampant absolute poverty.

But, considering Uganda is among the world's most corrupt nations, as ranked by Transparency International, avoiding the oil curse is probably a long shot.

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All that oil, located under Lake Albert (freshwater oil spills, anyone?), was owned by Tullow Oil, but was recently partially sold off, one-third each, to Total and China's state-run oil company CNOOC.

Last month, Foreign Policy ran a good piece giving the overview of the situation as it stands now. It's worth a read in its entirety, but this is the crux of it:

When the first oil discoveries were made in 2006, Ugandans had high hopes. Oil wealth, they assumed, could help to revive the nation's economy. But it hasn't worked out that way. [...] Recently, one of my journalist friends visited Hoima, an area where Tullow Oil Company is carrying out oil exploration. What he found there can be described as the complete absence of corporate social responsibility on the part of Tullow. He concluded that the locals, and in particular those whose existence depends on local lakes and rivers, have suffered a lot. He documented how many people have been driven off their land. Some have received compensation, others have not. Most of the affected individuals live in villages. They are poor, but rather than benefiting from the discovery of oil near their homes, their livelihoods are ruined. Where others see business opportunities, these villagers end up as the losers.

Though the Ugandan parliament attempted to investigate allegations of corruption surrounding the deals for its oil, passing resolutions on the matter last October, it has done little to slow progress down the path towards oil revenues not benefiting the ordinary people of the nation.

Tags: Oil | Uganda

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