The Democratic Republic of Congo (DRC), which was called a “geological scandal” because of its vast concentration of minerals, and Nigeria have become the poster children of what is wrong with oil and mineral discoveries in Africa. Both countries despite having huge mineral and oil deposits have failed to derive dividends from them.
Further, domestically, the discovery and exploitation of the mineral has led to “resource nationalism” – communities calling for a lion share, especially in peripheral regions long marginalised by the centre, which is often the case.
Kenya and Uganda recently discovered economically viable oil deposits, following years of being the sleepy backwater of global oil production. Following the discovery of oil in Kenya and Uganda, and gas in Tanzania the region was heralded as the next frontier of gas and oil production.
Uganda became the first country in East Africa to discover oil in the Albertan region West of the country in 2006. Then Kenya discovered oil in Turkana, northwest of the country, close to the South Sudanese and Ethiopian borders. Recently, the British Oil Company Tullow announced it has discovered what is thought to be 600 million barrels. This is the first time an economically viable oil reserve has been discovered in Kenya, although the country has been exploring for oil since the 1950s.
There is a huge divide between discovery and full exploitation; in most cases governments have reasons to overstate the discovery, but such a move is accompanied by tremendous level of expectation, especially from the local community.
In Kenya’s case, paradoxically, the North Rift Valley and part of Northern Kenya where oil has been discovered are two areas that have been neglected by successive governments. The two regions development indicators are shocking.
For instance, if you live in Nairobi, you are 15 times more likely to access secondary education as opposed to if you live in Turkana County. A report released by the society for international development in 2013, shows that poverty in Turkana is as high as 87.5 percent.
Such longstanding grievances about the central government’s neglect were manifest even before the exploitation of the oil has started. With the promise of an oil wealth, these disturbances would only grow more frequent. Youth and community leaders in the Turkana County have demonstrated against unfair recruitment practices by Tullow Oil Company.
The government and the oil companies working in Turkana will have to navigate the undeniable history of longstanding marginalisation of the community and the demands for benefits from the local community.
Any signs of “exploitation” will not be seen as a stand-alone issue, but rather a historical continuation of disenfranchisement policies of the past.
Kenya’s post-independence development plan was predicated on the “trickle-down effect” – develop the high potential regions, and the trickle down from these regions will spread to the low potential regions. Never mind that arbitrary demarcation of what constitutes “high potential” and “low potential” is highly problematic and has often been decided upon by whoever was in power.
During the period when marginalised regions were in the “purgatory”, awaiting the trickling down, the government did little to invest in their development. In the case of Turkana and adjoining areas, the government only took into consideration when security concerns arose.
Once Kenya negotiates some of these issues, oil discovery will catapult Kenya into an economic powerhouse not only in East Africa, but the whole of the continent.
The fact that the majority of the people in this region are pastoralists didn’t help at all. Those in power, who come predominantly from farming communities, see pastoralism as a mode of livelihood that is anachronistic and at odds with “modernity”.
Since the state was hardly present, the local communities armed themselves largely to protect themselves from cross border cattle raids. But over time, cattle raiding, which was meant to be a rite of passage among many pastoralist communities, has evolved into large-scale commercial enterprises.
It is no longer guided by the social norms enforced by the traditional leaders. Further, the weapons involved are no longer bows, arrows and spears, but guns and ammunition. The area is awash with small arms. Because of the economic incentive, cattle raiding has become increasingly bloodier.
Transparency and community involvement
The trust deficit between the community and Kenya’s government makes it critical for both the authorities in Nairobi and the Tullow Oil Company to engage with the locals. This should not be done as a PR exercise, but as genuine sustainable effort.
Long-standing community grievances, mixed with easily available weapons, is a poisonous mix, which, if not addressed could, undermine the further exploration and exploitation of the oil.
At the national level, the Kenyan government and the oil companies need to abide by the international best practices of transparency regarding the contracts. Tullow Oil needs to publish what they pay, and the government should make public the contracts it has signed.
The reason most of the African countries are failing to get the best out of their mineral resources is because a huge chunk of the industry’s activities are shrouded in secrecy – a mutually benefitting environment for the oil companies and the government. This leads to patronage, corruption, and unfair business, while also inflicting long-term environmental damage and conflict within communities.
Finally, Kenya needs to establish a sovereign wealth fund similar to Norway that could serve two functions. One, at the local level, the fund should be used to economically empower the Turkana community; two, at the national level, the fund could be used for various social projects.
Once Kenya negotiates some of these issues, oil discovery will catapult Kenya into an economic powerhouse not only in East Africa, but the whole of of the continent.