23 March 2005 Edition

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Different approaches to dealing with Shell

November 2005 will mark ten years since Ken Saro-Wiwa, activist and writer, along with eight colleagues, was executed by the Nigerian Government following a campaign against the environmental impact of oil companies in Ogoniland on the Niger Delta.

From the moment of their arrests, Wiwa's family always considered that oil corporation Shell was behind the deaths. Ken Saro Wiwa's son is pursuing a legal action against Shell, accusing the corporation of aiding and abetting the torture and murder of his father and other members of the Ogoni tribe, taking land for oil development without adequate compensation, polluting water and air, and recruiting the Nigerian police and military to attack local villages. Shell denies all charges.

While in some developed countries, like Ireland, governments are happily ready to allow Shell to cheaply take the country's resources, in developing countries, where until recently governments did not have a say and just accepted the dictatorship of the corporations, legislators are opposing the rule of multinationals.

Argentina was one of the richest countries of South America till its economy, built on the principles dictated by international financial institutions like the International Monetary Fund, the World Bank and the World Trade Organisation, collapsed in December 2001.

Argentineans took to the street, overthrew five governments in two weeks, and finally elected in 2003 Nestor Kirchner as their president. Not much was known of Kirchner in the international arena, as he came into the presidential race as the governor of one of the country's provinces. However, it seems that the new Argentinean president has decided to put the interests of his people above those of corporations or international institutions.

Sales of Shell in Argentina have dropped a staggering 70% since Thursday 10 March, when, in an unprecedented gesture, Kirchner urged the public to boycott Royal Dutch/Shell's products, to protest what he described as an "unjustified" 4.2% increase in the prices of petrol and diesel fuel. Shell said it hiked prices because of the rise in the international price of oil, but its local competitors have so far abstained from following suit.

"Argentines don't have to buy anything from Shell. Let's unite and not buy a single thing from them, not even a can of oil, so they realise that we will not put up with this kind of thing anymore," said Kirchner. Following his call to boycott products from Shell, which controls 16.5% of the Argentine fuel market, with 930 service stations, picketers' groups allied to the current administration occupied several stations impeding the sale of fuel.

Economist Claudio Lozano with the Central de Trabajadores Argentinos (CTA) trade union federation said the boycott is "an interesting strategy, because companies that raise their prices unjustifiably, when they are already making extraordinary profits, need some kind of discipline".

So far, the protests have extended to service stations identified with Exxon, which also increased fuel prices. On the other hand, Repsol-YPF, which controls 50% of the market, together with Petrobras and Sol, owned by the Uruguayan government, have left prices unchanged.

The boycott is quite popular in the country. However, as expected, Argentinean business interests are in the forefront of opposition to the government's initiative.

Luis D'Elía possibly the best known of all picketers' leaders, justified the blockading of gasoline stations, arguing that "in this country oil companies have financed coups, installed dictatorships and promoted hyperinflation".

The government is concerned about the impact of the rise in fuel prices, as well as increases for other products (including beef and construction materials), on the cost of living in a country where nearly half of the population of 37 million is still below the poverty line.

Ireland and Shell

Kirchner's actions highlight the Irish government's contrasting dealings with corporations, especially Shell, which was recently granted planning permission to build a pipeline and facility connected to the Corrib Gas field, with the blessing of the Fianna Fail/PD administration, despite local opposition.

Now Shell is taking to court seven farmers it claims are obstructing its planned pipeline. Shell, which made record profits of €13.6 billion in 2004, told the court that will lose €2.5million unless it has immediate access to the land. The landowners testified they were worried about a high pressure gas line being channelled under their land and said they have been bullied and harassed by Shell employees after they refused to accept compulsory purchase orders.

Sinn Féin's Pearse Doherty called last year for a full investigation into the activities of Shell in Ireland, following revelations that Shell lied about their international oil and gas reserves, overestimating them by 20%, and after the corporation was fined by regulators in the United States and Britain for a total of about $150 million for what Britain's Financial Services Authority described as "unprecedented misconduct".

At the time, Doherty linked Shell practices in Nigeria with the company's plans for Ireland, pointing out that the gas resources off Mayo's coast will never be "developed properly and with benefit to the Irish people under the arrangements that currently govern the sector" - arrangements put in place by disgraced former minister Ray .

The controversy was ignited by a Channel 4 News item, which raised serious question marks over the State's plan for the controversial pipeline and inland terminal, claiming there was pressure on locals to sign their property over to oil executives and that the terms of the deal struck with Shell were unprecedented in Europe.

The report revealed a memo from a planner in County Mayo saying that then Marine Minister Frank Fahey wanted to be on a planning committee while the project for Enterprise Energy Ireland now owned by Shell was processed. Other records unearthed in the investigation indicate there was substantial pressure on Mayo County Council's planning committee from the Department of the Marine.

Two of the companies involved in the Corrib Field also gave money to Fianna Fáil in 1998, but there is no suggestion Fahey himself received a political donation. At the time, Sinn Féin's natural resources spokesman Martin Ferris said the handling of the project confirmed the worst suspicions of those who opposed it.

The government has given away national natural resources to Shell, with little of the gas revenue going back to Irish taxpayers.

Then, there is the environmental impact the project will inflict on the area. Shell's gas terminal is being built in a bog, so construction involves the removal of 650,000 cubic metres of peat and its transferral to another bog 11km away. This poses the risk of landslide where the peat is stored; of flooding due to the removal of the rain absorbing turf in a area which gets on average 200 days of rain a year; and finally, problems from extra traffic, with what one local activist has calculated as 800 truck journeys for six months along poor, narrow, winding country roads.

The toxic waste from the terminal is to be pumped into Broadhaven Bay. The Erris Inshore Fishermen's Association is one of the objecting parties in the planning permission process, fearing the destruction of stocks of salmon and crab, upon which much of the local economy depends.

According to Friends of the Irish Environment, the exact point where the pipeline comes on shore is a rare sandmartin nesting colony.

The Environmental Impact Statement made for the Department of the Marine by Shell as part of the process to gain a licence for offshore work claimed there was "no evidence that Broadhaven Bay is of particular importance to cetaceans (whales and dolphins)". Against this, the Irish Whale and Dolphin group pointed out the historic and anecdotal evidence to the contrary.

However it now turns out that Shell commissioned a study by University College Cork's Coastal and Marine Resources Centre, which found the exact opposite from the claim Shell made in its environmental impact statement. Shell neglected to mention the study, which found that Broadhaven bay was an important breading and rearing area for dolphins and whales.

Shell has already been carrying out underwater blasting and seismic surveys, which are detrimental to whales, seals and dolphins. They sense through sound and the noise generated by blasting and surveys drives them away, disorientates them and disrupts feeding and breeding patterns, in all probability causing a population reduction. Various Irish and EU laws ensure the conservation of these species, but don't wait for the government to enforce them.

An Phoblacht
44 Parnell Sq.
Dublin 1

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