The Squeeze: Oil, Money and Greed in the 21st Century. Tom Bower

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СКАЧАТЬ oil, said protestors in the electrified atmosphere, was blood. The promise by Abacha in July 1994 that the death penalty would be imposed on ‘anyone who interferes with the government’s efforts to revitalise the oil industry’ chilled Saro-Wiwa’s supporters, especially the striking oil workers.

      Brian Anderson, who replaced Watts as the local Shell chairman in 1994, visited General Abacha. Like many Europeans, he had assumed that Saro-Wiwa would receive a short sentence. Nurtured by Shell’s straitjacketed culture, Anderson was immune to the nuances of the dictatorship, and his report to The Hague after his first conversation with the general did not raise any alarm. One year later, after a prejudiced trial, Saro-Wiwa was condemned to death. Only after the verdict and another visit to the general did Anderson realise his mistake. By then it was too late to influence Shell’s directors. Like a supertanker, they were impervious to shocks that required an immediate change of course. By then, Saro-Wiwa’s fate had become an international issue. Across America and Europe he was portrayed as the victim of Shell’s conduct, and the company was accused of polluting the Ogoni farmlands and of failing to protest against the rigged trial while financing the government’s destruction of the delta. President Clinton, Nelson Mandela and other international leaders protested to Abacha. The World Bank, Church leaders, Greenpeace, Amnesty International, PEN, the International Writers’ Association and even members of the Royal Geographical Society demanded that Shell abandon its operations in Nigeria. The opprobrium spread across all of Big Oil. Accused of exploitation, corruption, environmental damage and murder, Shell was urged to intercede and prevent Saro-Wiwa’s execution.

      In The Hague, Cor Herkströter and his board maintained their composure. Shell men never flapped. Shell’s ‘Business Principles’, a set of guidelines committing the company to an apolitical role, had been adopted in 1976 and subsequently updated five times. According to those principles, Shell’s duty was to be decent but not evangelical. Multinationals should not interfere in sovereign states. ‘We must be part of the furniture,’ everyone agreed. ‘It’s ridiculous that we should intervene against a military dictatorship,’ said one director, to approval. ‘If we left,’ said another, ‘we would cut off Nigeria’s nose and our own. The French would replace us in a flash.’ The company’s huge investment needed to be protected, not least because after years of frustration there was still hope that the Nigerian government would agree to build a plant to liquefy and ship the country’s vast deposits of natural gas in tankers as LNG (liquefied natural gas). Shell was the master of the complicated technology necessary to freeze natural gas to minus 160°C, at which temperature it became liquid gas, which could be shipped around the world. Six hundred cubic metres of natural gas could be condensed into one cubic metre of LNG. The profits would be huge. Only a minority of British directors understood that Shell’s investment in Nigeria was becoming disproportionate to the profits. The capital, they believed, could have been better spent elsewhere. That British minority believed that standing aside from Nigeria’s political battles had been mistaken, and that Shell should have taken more interest in the delta’s environment years earlier. Yet in the midst of the storm, changing course had become too difficult. There was no alternative but to support the wrong decision. ‘I never doubted that Shell would stay the course,’ said Watts. ‘We resiled from protest,’ observed a Dutch director. ‘Shell should not be blamed for an unjust government.’ ‘Shell doesn’t get involved in politics,’ announced a spokesman. Questions were referred to the British, Dutch and American governments, which equally failed to make any forceful protest and opposed sanctions, although Nigeria exported 40 per cent of its oil to the US. At the very last moment Shell and the three governments did protest to General Abacha, but on 10 November 1995 Ken Saro-Wiwa and his eight fellow defendants were executed. Greenpeace blamed Shell’s silence for the deaths. ‘It is not for commercial organisations like Shell,’ replied a company spokesman, ‘to interfere in the legal process of a sovereign state such as Nigeria.’

      Stigmatised as international pariahs, Shell’s directors realised on reflection that earlier intervention by the corporation might have stopped Saro-Wiwa’s execution. Nevertheless, amid appeals for international sanctions, Anderson and Shell’s directors met in London to decide whether to push ahead with the plan to build an LNG plant for Nigeria’s natural gas. One month later, on 15 December 1995, 30 years after suggesting the idea, Dick van den Broek of Shell signed an agreement with the Nigerian government to build a $3.8 billion LNG plant. He had threatened that failure to sign would terminate any future agreements with the company. Shell’s directors were ecstatic. Ninety per cent of the LNG output had been pre-sold, and Shell was a 25.6 per cent shareholder. Shortly after, Shell agreed to build a giant platform offshore, in an area called Bonga. These deals aggravated suspicions about Shell’s conduct during the Saro-Wiwa affair and its promise to return to the Ogoni region if its workers’ safety was guaranteed by local communities. Many critics believed that Shell’s managers in Nigeria had refused to protest against Saro-Wiwa’s execution because of collaboration with the regime. Those censuring Shell included the World Council of Churches, whose report accused the company of polluting the Ogoni area by dumping oil into waterways and of showing ‘inertia in the face of the government’s brutality’, which included intimidation, rape, arrests, torture, shooting and looting. God, said the Council, damned Shell in Nigeria. Shell denied all the charges. Exonerating itself of any responsibility because it had withdrawn from Ogoniland in 1993, Shell derided the report for regurgitating old and previously discredited allegations, 99 per cent of which, it declared, were fabrications. But the company could not win. The criticism nevertheless prompted Herkströter to admit that Shell’s culture had ‘become inward-looking, isolated and consequently some have seen us as a “state within a state”’. Mark Moody-Stuart was among the few who became openly disturbed that the company had misjudged the situation. ‘We should have been more patient,’ he admitted, ‘and less angry and offered more. There are lessons to be learned.’ ‘Nigeria,’ lamented John Jennings, a Shell director, ‘is like a house falling down. All we can do is patch it up so it leans but doesn’t collapse.’ Watts was philosophical. ‘In oil, mistakes get buried in the mists of time.’ In June 2009, Shell would pay $15.5 million in compensation to settle a lawsuit with Saro-Wiwa’s family, while admitting no wrongdoing.

      Few Nigerians had attended Watts’s farewell party from Nigeria in 1994, but Shell’s directors were relieved that the company’s investments in the country were secure. General Abacha had been persuaded that without Western expertise, Nigeria’s oil production and income would diminish. Unlike Venezuela and Indonesia, Nigeria had no intention of expelling the oil majors. Both sides agreed they needed stability. In view of the continuing violence targeted against the president, Brian Anderson accepted the permanent protection of Nigerian soldiers for Shell’s employees. The corporation’s archives for 1995, Shell’s annus horribilis, were sealed. Reviving the company had become critical to its future prosperity.

      Shareholders were demanding improved profits. Years of cautious under-investment, Herkströter realised, were no longer sustainable. The company had been bruised like the other oil majors by the fall of oil prices, and its poor financial performance had been undermined by choosing only ultra-safe investments and its failure, other than in the Gulf of Mexico, to find ‘elephants’. To improve value per share, Herkströter decided to stop the company befriending presidents and kings, and to focus on reform of its financial controls. Localness, previously Shell’s strength, was to be curbed. Fiefdoms were abolished. One third of the headquarters staff were made redundant, and the power of the resident chairman in each country was reduced in favour of Exxon’s method of governance through central control. The survivors were ordered to stop playing politics and start earning money. But Herkströter’s headlines did not translate into action: little happened other than a costly joint venture in America with Texaco and Saudi Aramco (the Arabian-American Oil Company) which would prove disastrous. To prevent the balance of power tilting towards the British directors, Herkströter marshalled the Dutch directors to reject Mark Moody-Stuart’s proposed purchase of British Gas (BG), a substantial oil exploration and production company, for £4 billion. Moody-Stuart was ‘very upset’, observed Phil Watts. In 2008 BG would be worth about £35 billion.

      Herkströter СКАЧАТЬ