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ENERGY-SAO TOME AND PRINCIPE: Oil Raises Hope, Fear

Lansana Fofana

SAO TOME, Jun 30 2003 (IPS) - The discovery of oil in the rugged and forested islands of Sao Tome and Principe has raised both hope and fear in the former Portuguese colony located off the west coast of Africa.

"We, in Sao Tome, will be very careful. We are not going to repeat the mistakes of other African nations where natural resources turned into a curse rather than blessing for them," remarked the Prime Minister of Sao Tome and Principe Maria das Neves, when opening an international conference on Africa’s extractive industries last week.

"We will be transparent as much as we can in our dealings and ensure that the people of Sao Tome directly benefit from their country’s oil wealth," das Neves added.

The twin islands of Sao Tome and Principe are believed to be sitting on about two billion barrels of crude oil. They have already attracted the attention of multinational oil companies as well as powerful countries like the United States and Nigeria.

The Americans are considering setting up a military base in Sao Tome, and there have been exchange of visits between officials of the two countries.

In Sao Tome, a high-ranking government official, who preferred anonymity, told IPS: "Our President Fradique de Menezes actually approached the Americans for some sort of military help, in the event that oil exploration and drilling commences".

He acknowledges his country’s vulnerability given its proximity to Nigeria. The Nigerians have offered to sign a mutual defence pact with their tiny neighbour, which would involve the deployment of Nigerian troops on the islands. "We are a bit worried about this plan and would rather not have Nigerian troops here," says Alberto, a civil servant in Sao Tome.

The people of Sao Tome, whose islands are just 500 kilometres south of Nigeria, are clearly coy about any such arrangement. Why not? The country, with a population of 140,000, has an army of barely 200 soldiers. It could easily be overrun by its giant neighbour, Nigeria.

The problem now is that Nigeria had signed an agreement with the previous government of Sao Tome and Principe which gave Nigerian oil firms concessionary deals of about 40 percent of the islands’ oil deposits. It seems though that all this is set to change, with greater interest shown by other oil conglomerates from other countries and their American counterparts.

"There is no doubt that those deals would be revisited in the near future," quipped an aide to President Menezes. "After all, we have the right to choose the people we want to do business with, and in our own best interest."

Sao Tome is one of Africa’s poorest countries, thanks to the plummeting of revenue from the cocoa industry and the break-up of the cocoa plantations, the mainstay of the islands’ economy.

The country gained its independence from Portugal in 1975 and has since been largely abandoned by the donor community. But, it seems, the oil discovery is set to change all that and possibly transform the country into Africa’s Brunei.

"I have been on the plantations for more than 15 years but things are just not changing," said Luis, a cocoa farmer. "The discovery of oil is good news. Perhaps, this will help us educate our children and improve our social condition".

Miquel, a high school dropout, agreed. "I have always nurtured the idea of going in search of greener pastures abroad; but if the story of the oil discovery is true, I will drop the idea, stay home and benefit from the largesse," he told IPS.

The battleline between the competing foreign powers is being drawn. President Menezes, a wealthy cocoa plantation owner who also owns businesses in Portugal, is getting closer to the Americans, but is not entirely dumping his Nigerian neighbours.

"We will still deal with the Nigerians. They have two options, clearly; either renegotiate the deals or liquidate. But we certainly do want to get them on board," the President said recently.

While waiting for the windfall, the islanders are clearly enthusiastic about their country’s new-found source of wealth, though they will prefer to harness their oil revenue in peace.

"We do cherish wealth from our oil deposits. But we have seen how such revenue from natural resources end up destroying other African states, so we will rather stay poor than being plunged into anarchy," said Raul, a political commentator in Sao Tome.

The authorities say Sao Tome should get its first oil in four years, if all goes according to plan. And once they begin to export the crude, they will use the revenue for improving health, education and fighting poverty on the islands.

 
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