The government of Malawi lifted the oil ban on Lake Malawi in February, 2016. Ever since then the government of Malawi has not explained to the citizenry on why it decided to lift the suspensions. It is noted that the government of Malawi in November, 2014 put a ban on oil exploration in Malawi pending review of the oil licenses in view of that they were awarded dubiously. The lifting of the ban has been done almost a year later without proper explanation from the Ministry of Natural resources and mines on why they decided to lift the ban.
Currently the latest scooping study by the Malawi Extractives Industries Transparency Initiative (MEITI) report of February, 2016 reveals details of some payments that were made to Malawi government by oil companies but has not been accounted for by the government. The government of Malawi is not ready to make the production sharing agreements of the oil proceeds public. It is uncertain on how government of Malawi will protect Lake Malawi National Park which is a world heritage site and has been earmarked under block 4 of oil to be drilled in Lake Malawi. Lake Malawi is a unique lift valley formed lake with over a 1000 species of cichlids where 300 are unique to Malawi only. The fish species occur under rare evolutionary processes as such they are bound to be lost should the oil drilling process continue.
The other pertinent question is whether government of Malawi has renegotiated oil deals with the oil companies.The Attorney General’s office of Malawi in February 2015 suspected that the current holders of oil licenses in Lake Malawi were but one company operating under thin corporate veil.
The current oil governance system in Malawi is not suitable for the exploration and drilling process. In view of the secrecy surrounding the oil deals and lack of transparency in the system this is a threat to Malawi. The current archaic legislation namely Petroleum Production and exploration Act of 1983 being used and the lack of petroleum production policy are worth scrutiny. The fear of lacking environmental standards compliance by extractive and manufacturing industries in Malawi pauses a threat.
The Oil and gas industry in Malawi has no specific legitimatized procedure of achieving compliance to environmental and wildlife conservation both on land and in water bodies. The government has no legislation in tandem with modern business operations that requires companies to outline environmental and wildlife conservation procedures. The current framework is only the Environmental and Social Impact Assessment which is very limiting when it comes to biodiversity and wildlife conservation as well as compliance to standards.
According to one PhD Student Sitinga Kachipande; Oil has not been as profitable as it was in the past due to changes in the global political economy. The profits that oil producing countries were once yielding have drastically decreased worldwide. Already, the world has witnessed oil producing countries such as the US lay off nearly 10,000 workers and British Petroleum let go of 4,000 employees. Angola and Nigeria, Africa’s largest oil producers, have also seen their oil profits decrease steadily. Additionally, the recent lifting of sanctions in Iran, who once had been unable to sell oil on the international market, will further impact this sector.
Iran has been cash strapped due to the international embargo placed on its trade years ago and has a surplus of oil to unleash on the global market. It holds the fourth-largest oil reserves in the world and roughly 20 to 40 million barrels in storage. Therefore, the lifting of international sanctions means the likely influx of Iranian oil on the world market will cause oil prices to drastically drop and will lead to greater competition for market share and further uncertainty in this market. Other than Iran, there are a plethora of other factors – including viable alternatives and improvements in fuel technologies – that are leading current oil producing countries to diversify and financial lending institutions to predict an end of the era of oil.
Whereas just in 2016, the Malawi government is battling latest cases of looting public funds and corruption by senior public officers.All cases of looting public resources in Malawi reveals a growing trend of highly organized crime systematically arranged by public officials of high ranking using junior officers. The recent victims being the Health Ministry, Ministry of Agriculture and Ministry of International Relations. Media reports indicate Millions of US$ being siphoned from the Malawi’s foreign embassies. The Ministry of Health has also lost Millions of US$ through this new series of looting nicknamed as cash-gate in Malawi. The Agriculture Ministry which often gets a lion’s share in the national budget has also been hit by this latest looting of public funds. Over 60% of the Malawi national budget is supported by foreign bilateral donors or development partners.
In view of this current trend it is uncertain whether resources realized from the oil proceeds will trickle down to the ordinary Malawians. It is being suspected that the way government is pushing the oil deals with all the secrecy behind it Malawians are being duped. The oil deals in Malawi is just another form of Cash-gate in the making should this process continue without proper regulatory framework.
At the same time the government of Malawi is not outlining the contingency plans and safety nets for the people who directly benefit from Lake Malawi for agriculture, fisheries, tourism, and livelihoods. The same government of Malawi through the central region water board is planning to tap drinking water from the same lake where oil is to be drilled. It is therefore uncertain on how Malawians will manage to properly drill oil without spillages and pollution let alone drink water from the same Lake. Yet to be seen by ordinary Malawians is how the price of drinking water will be affected.
In view of the above scenarios and trends in Malawi the oil drilling in Lake Malawi will lead to gross environmental human rights violations. Malawians are indeed being duped on the current crude oil exploration and drilling.
About the Author
Godfrey Mfiti is Environmental Rights Activist who is persuading Malawi Government to withdraw oil drilling plans on Lake Malawi.Follow and Subscribe Nyasa TV :