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Prepared by the
Institute for the Analysis of Global Security

August 5, 2003
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Under the Radar

Oil, terrorism and drugs intermingle in Colombia
Seventy U.S. Special Forces soldiers are training Colombians to protect an oil pipeline.

Japan's struggle to secure future oil supply
Energy dependent Japan looks to Iran for oil, causing tension with the U.S.

Chad-Cameroon pipeline project put to test
Will the pipeline, partially financed by the World Bank, improve the lot of Chad and Cameroon or exacerbate existing corruption and strife?

Natural resource curse hits São Tomé
A tiny West African country illustrates a well known problem.

On the technology front

Fuel Cell Locomotive for Military and Commercial Railways
An international consortium is developing the world’s largest fuel cell vehicle, a 109 metric-ton, 1 MW locomotive.

Fuel cell power plant installed at NJ Sheraton
A stationary fuel cell will supply 250 kilowatts of electric power as well as heat to the Sheraton Edison Hotel, accounting for about 25 percent of the hotel's electricity and hot water.

Fuel cell scooters for Europe and China
Palcan's fuel cell powered scooter is designed to address the world's need for a low-end mass transport vehicle.

U.S. Air Force to get fuel cell bus
Fuel cell powered thirty-foot hybrid bus to be stationed at the Hickam Air Force Base in Hawaii.

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Back Issues

Chad-Cameroon pipeline project put to test

Experimental pumping of oil through the Chad-Cameroon pipeline has begun. The pipeline, single largest private sector investment in sub-Saharan Africa, stretches 650 miles from the Doba basin oilfields in southern Chad to export facilities located offshore Kribi, Cameroon, in the Gulf of Guinea.

According to the World Bank, the project, undertaken by ExxonMobil, Petronas of Malaysia, and Chevron and partially financed by the World Bank Group, could result in nearly $2 billion in oil revenues for Chad and nearly $500 million for Cameroon. Others estimate Chad will receive as much as $3.84 billion in the first ten years of production alone, and perhaps $5 to $6 billion over the span of the project.

Human rights activists and international institutions are concerned the influx of oil revenue will serve to exacerbate the two countries' chronic problems. Both countries are rated "Not Free" by Freedom House.

Chad's government's human rights record is abysmal. The population has endured numerous incidents of extrajudicial killings, arbitrary arrest and detention, and media repression. The average income of its 7 million people is less than $1 per day and there is a history of tension and conflict among the populations of the Doba Basin region in southern Chad where the oil fields are located. The World Bank described Chad's institutional weakness as "all encompassing and greater than in most sub-Saharan African countries, reflecting the impact of almost three decades of civil strife."

In testimony before the U.S. House of Representatives Subcommittee on Africa, Peter Rosenblum, Director of the Human Rights Program at Harvard Law School, noted, "It is relevant to take into account the ethnic and religious divisions-the Arabized Muslim north, the Christian animist south. Chad is not Sudan. It is not Nigeria. But there is much in common, including the risk that a militarized north is going to become dependent on a disenfranchised south."

Cameroon, for its part, is one of the most corrupt countries in the world and its human rights record is far from clean. It ranked first in Transparency International's corruption perception index in 1998 and 1999. The World Bank said in 2001 that the country "has a track record of endemic corruption."

With such bad record of governance it is doubtful whether the two countries will be able to manage their petrodollar wealth.

Both countries have imposed apparently stringent measures to control the flow of money. Chad's parliament has passed legislation calling for 80 percent of the oil revenue to go to the country's health, education and infrastructure. Oversight committees have been established in both countries to monitor the management of oil revenues. However, Rosenblum noted, "the government of Chad has failed to demonstrate the necessary good will to enable the oversight committee to play the role that it could play under the law," specifying among other examples that "the government refused to allocate space or to allocate a budget to the oversight committee so that it could operate."

The World Bank effort on the Chad-Cameroon project is an innovative experiment designed to reduce poverty and improve transparency in Africa. Only time will tell if Chad and Cameroon were prepared for such a project. If the project proves successful then it could be replicated in other parts of the developing world. But a report by the Catholic Relief Services expresses doubt that this would be the case: "Very special circumstances led to the Chad-Cameroon Project. Chad is landlocked, requiring massive investment to bring the oil to market. It is extremely poor, making the leverage of the World Bank particularly strong prior to the oil boom. Because of the criticism heaped on companies operating in Sudan during its war, foreign oil companies decided that they could not go forward in conflict-ridden Chad without World Bank participation and strong conditionalities. This is in stark contrast to Equatorial Guinea, where oil is offshore and the companies decided they did not need World Bank participation. This combination of factors may not be seen again."