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‘We cannot drink oil’: campaigners condemn east African pipeline project.

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2 years ago

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Patrick Pouyanné of Total; Tanzania’s President Samia Suluhu Hassan, and President Yoweri Museveni of Uganda after signing agreements for the controversial pipeline. Photograph: Courtesy of Total – Uganda

Activists say the ‘heart of Africa’ line shipping crude from Uganda to Tanzania is unnecessary and poses a huge environmental risk

Activists have accused French and Chinese oil firms of ignoring huge environmental risks after the signing of accords on the controversial construction of a £2.5bn oil pipeline.

Uganda, Tanzania and the oil companies Total and CNOOC signed three key agreements on Sunday that pave the way for construction to start on the planned east African crude oil pipeline (EACOP). But on Tuesday a letter signed by 38 civil society organisations across both east African countries said the parties had failed to address environmental concerns over the pipeline and had steamrollered over court and parliamentary processes.

Work is expected to begin this year on what would be the world’s longest electrically heated pipeline, which will move crude oil from fields near Lake Albert in western Uganda 900 miles to Tanzania’s Indian Ocean seaport of Tanga. Uganda’s crude oil is highly viscous, so it must be heated to be kept liquid enough to flow.

Uganda’s president, Yoweri Museveni, and his Tanzanian counterpart, Samia Suluhu Hassan, witnessed the signing of agreements between shareholders, host governments, and on tariff and transport between EACOP and the Lake Albert oil shippers.

Uganda discovered reserves of crude near Lake Albert on its border with the Democratic Republic of the Congo (DRC) in 2006, and the landlocked country wants a pipeline to transport oil to international markets.

“These agreements open the way for the commencement of the Lake Albert development project,” Total said in a statement on Monday. “The main engineering, procurement and construction contracts will be awarded shortly, and construction will start. First oil export is planned in early 2025.”

The oil will come from two projects – the Tilenga project, operated by Total, and the Kingfisher project, operated by CNOOC, which together are expected to produce up to 230,000 barrels a day. Government geologists estimate total reserves at 6bn barrels.

However, Diana Nabiruma, of the Africa Institute for Energy Governance (AFIEGO), told the Guardian: “It is concerning that major agreements are being signed and the companies are being given the go-ahead to award contracts and start developing the Lake Albert oil project.

“The oil projects pose major environmental risks. Resources, some shared with countries such as the DRC, Tanzania and Kenya, including Lake Albert as well as Lake Victoria and rivers, are at risk of oil pollution,” she said

A globe at Uganda’s Murchison Falls national park. Activists fear the 900-mile pipeline poses risks to water resources and fisheries. Photograph: Yasuyoshi Chiba/AFP/Getty

“The resources support the fisheries, tourism and other economic activities. They are also important for food and water security. They therefore must be conserved.”

The #StopEACOP alliance campaign condemned the decision to build the pipeline, which it says will displace 12,000 families and would be a huge environmental risk at a time of climate emergency, when the world needs to move away from fossil fuels.

Vanessa Nakate, founder of the Rise Up climate movement in Uganda, said: “There is no reason for Total to engage in oil exploration and the construction of the east Africa crude oil pipeline because this means fuelling the destruction of the planet and worsening the already existing climate disasters in the most affected areas.

“There is no future in the fossil fuel industry and we cannot drink oil. We demand Total to rise up for the people and the planet,” she said.

Lucie Pinson, of Reclaim Finance, which works to decarbonise the financial system, added: “We call on banks to publicly commit to stay clear of the project and investors to vote against Total’s climate strategy and the renewal of the mandate of its CEO Patrick Pouyanné at the group’s AGM in May.”

Last week, more than 260 African and international organisations sent an open letter to 25 commercial banks urging them not to finance the construction of the EACOP.

David Pred, of Inclusive Development International, which supports communities to defend their rights against harmful corporate projects, said: “The oil companies are trying to dress up the investment decision signing ceremony, but fortunately this climate-destroying project is far from a done deal.

The country has yet to see anything of the oil bonanza that seemed near when deposits of crude were discovered in 2006. Photograph: Yasuyoshi Chiba/AFP/Getty

“Total is also taking into the highest consideration the sensitive environmental context and social stakes of these onshore projects. Our commitment is to implement these projects in an exemplary and fully transparent manner.”

CNOOC has been approached for comment.

But Nabiruma accused the two east African governments of racing to sign deals before their citizens had been told how any risks would be “avoided, minimised or mitigated”.

Robert Kasande, permanent secretary at Uganda’s ministry of energy and mineral development, said: “We are very mindful of the environment that we work in. It’s a very sensitive ecosystem. So we have put everything that we need to do in place.”

He said the project was being conducted in accordance with the Equator principles – a risk-management framework adopted by financial institutions for assessing and managing environmental and social risk in projects.

“This is a big project for us as a country,” Kasande said. “These resources that are going to be coming into the country are going to be a huge boost to this economy.”

Original Source: The Guardian.com

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A corporate cartel fertilises food inflation

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2 weeks ago

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May 24, 2023

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Last year’s financial results from the world’s largest fertiliser companies are now in — and it’s a shocker. Given the sky high fertiliser prices of 2022, it was anticipatedthat their revenues would break records, but no one could have predicted this scale of profiteering. As the world grappled with a severe food crisis and farmers saw costs rise, the world’s largest fertiliser firms ramped up their margins and more than tripled their profits from two years ago.

Graph 1

Graph 1 shows the total profits of the big nine fertiliser companies over the past five years. They exponentially grew from an average of around US$14 billion before the Covid-19 pandemic to US$28 billion in 2021 and then to an astounding US$49 billion last year. International agencies like the World Bank blamed the spike in fertiliser prices on the Russian war in Ukraine, resulting in high natural gas prices (used to produce nitrogen fertiliser) from shortages and trade disruptions. But as can be seen in Graph 2, a major part of the story is the monopoly power of the fertiliser companies. These companies increased prices far beyond the increases in production costs and boosted their profit margins to a massive 36% in 2022.
Graph 2
There are signs that fertiliser prices are coming down from their stratospheric heights earlier this year, but the effects of the price spike are still being felt. The high prices and lack of supply in some countries caused farmers to cut fertiliser use, thereby reducing production levels and contributing to an alarming rise in global food insecurity. The high prices also pushed many farmers deeper into debt. Farmers from Cameroon to the U.S. say they are still spending three times as much on fertilisers as they were a few years ago. And in countries where fertilisers are heavily subsidised, the price spike has saddled governments with huge debts. In India alone, the central government’s expenditure on fertiliser subsidies last year surged from US$9.8 billion to US$17.1 billion. People are paying the price for the fertiliser industry’s price gouging.
The costs are also rising for the planet. Chemical fertilisers are a major source of environmental pollution and greenhouse gas emissions, with nitrogen fertilisers alone accounting for one out of every 40 tonnes of annual emissions. New reports from the UN’s Food and Agriculture Organisation and Earth4All, a global collective of leading scientists and economists, make it clear that steep and immediate reductions in global fertiliser use are required to avert catastrophic climate change. Both recommend a near phase-out of nitrogen fertiliser consumption by 2050 (see Graph 3). The idea is not to recklessly crash production levels, but a planned transition toward more sustainable, agroecological farming systems that require less or no fertiliser.
Graph 3
It is increasingly clear that today’s food inflation is a product of both corporate greed and ecological breakdown. Obscene levels of profit-taking by corporations are happening across the food system, from fertilisers to processing to retail, and this is pushing up prices. But the way these corporations organise our food production and distribution is also driving climate change and, undermining the capacity for the global food system to deliver affordable and accessible food, now and over the long term.
Bold new approaches are urgently needed to reign in corporate power in the food system and turn the food crisis around. When it comes to fertilisers, policy actions like windfall taxes and price controls can help. But to deal with both profiteering and environmental catastrophe we need to transition food production to rely far less on chemical fertilisers. The fertiliser industry will be pushing for the opposite when it gathers for its annual meeting in Prague this week, yet around the world there are farmers and rural movements already leading a transition away from chemical fertilisers, with plenty of successful examples to learn from. What’s holding us back is the structural political change needed at all levels to address the excess profiteering from the fertiliser industry, and chart a new path toward more resilient food systems.
Source: grain.org

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The Black Sea Grain Initiative: When the United Nations Brokers Profits for Corporations, Bankers, and Oligarchs

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2 weeks ago

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May 23, 2023

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“I am so moved watching the wheat fill up the hold of the ship. It was the loading of hope for so many around the world,” said United Nations Secretary-General, Antonio Guterres, as a cargo ship was loaded up with Ukrainian grain in August 2022. Mr. Guterres was launching the Black Sea Grain Initiative, purportedly to prevent famines and a global food crisis by enabling food exports from Ukraine, amidst the Russian military blockade. USAID claimed that the “lifesaving deal”, which was renewed on May 18, 2023, “helps people in need across the globe by delivering desperately needed grains to lower income countries and bringing down food prices.” The European Commission celebrated the initiative as a “a critical step forward in efforts to overcome the global food insecurity caused by Russia’s aggression against Ukraine.”

Mr. Guterres’ hope, loaded on the cargo ship, has however since gone missing at sea.

Despite the hype in political circles and the Western media that the Initiative was essential to secure food supply for those in need — particularly in Africa — data released by the United Nations offers a starkly different reality. As of May 2023, only 3 percent of the food commodities exported from Ukraine under the initiative has gone to low-income countries. Out of the 30.3 million tons exported, a mere 2 percent — 625,000 tons — went to the World Food Programme for food aid operations around the globe.
Charts showing grain exports from Ukraine by income group and country.

The top destination for Ukraine’s agricultural exports is the European Union, with China being second. Spain is the largest recipient in Europe. Instead of offering relief, Ukrainian exports are threatening the livelihoods of millions of European farmers — to the extent that Hungary and Poland banned imports from Ukraine in April 2023 to protect their farmers. As Ukraine and the European Commission pressured for the ban to be lifted, Hungarian and Polish farmers pushed back, asking the critical question: Who actually benefits from these exports?

The Oakland Institute’s report, War and Theft: The Takeover of Ukraine’s Agricultural Land, answers the question. It exposed that the producers exporting commodities from Ukraine are mostly large-agribusinesses and oligarchs, associated with European and North American financial interests. Furthermore, the report detailed how these producers are heavily indebted to Western financial institutions, in particular the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and the International Finance Corporation (IFC) — the private sector arm of the World Bank. Together, these institutions are major lenders to Ukrainian agribusinesses, with close to US$1.7 billion lent to just six of Ukraine’s largest landholding firms in recent years. Other key lenders are a mix of mainly European and North American financial institutions — both public and private.

Renewing the Black Sea Initiative and maintaining the flow of exports from Ukraine has nothing to do with supporting the struggling Ukrainian farmers or the trumpeted goal to prevent a global food crisis — which has been largely triggered by speculation on global food markets. Food prices skyrocketed when global stocks of cereals were at historically high levels according to the World Bank.

Pretending their goal is to fight world hunger is appallingly deceitful, when, with the Black Sea Grain Initiative, the United Nations has become a business broker for agribusiness corporations. In violation of its values and the principles of the United Nations Charter, together with the Western banks and financial institutions, the United Nations is supporting large food trading companies, oligarchs, and their lenders and shareholders, to sustain export business and grow profits despite the carnage of war.

Source: oaklandinstitute.org

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Grain trader Cargill faces legal challenge in US over Brazilian soya supply chain

Published

4 weeks ago

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May 8, 2023

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World’s biggest grain trader accused of ‘shoddy due diligence’ on deforestation and alleged rights violations.

The world’s largest grain trader, Cargill, is facing a first-ever legal challenge in the United States over its failure to remove deforestation and human rights abuses from its soya supply chain in Brazil.

ClientEarth, an environmental law organisation, filed the formal complaint on Thursday, accusing Cargill of inadequate monitoring and a laggard response to the decline of the Amazon rainforest and other globally important biomes, such as the Cerrado savannah and the Atlantic Forest.

The case, which was submitted under the guidelines of the Organisation for Economic Co-operation and Development, argues that Cargill’s “shoddy due diligence raises the risk that the meat sold in supermarkets across the world is raised on so-called ‘dirty’ soy”. ClientEarth says this breaches the international code on responsible business conduct.

The lawyers behind the complaint have stressed the urgency of the issue because Amazon degradation is approaching a tipping point, after which scientists say the rainforest will turn into dry grassland, emitting vast amounts of carbon dioxide. The Amazon’s sister biome, the Cerrado, has already lost half of its tree cover.

The lawyers say they hope the legal challenge will raise standards at Cargill – which is the biggest privately owned company in the US, with revenues last year of $165bn (£131bn) – and set an example across the industry.

Laura Dowley, a lawyer at ClientEarth, said: “Cargill has vast resources at its disposal to implement due diligence. The technology is already there. We aren’t asking it to do anything it doesn’t have the resources to do. We hope it will show leadership.”

Cargill has promised to be “deforestation-free” in the Amazon and Cerrado by 2025 and completely eradicate deforestation from all its supply chains by 2030. The company says it has put in place a sophisticated monitoring operation at ports, warehouses and other points in its supply chain. ClientEarth said it identified several shortcomings in this system, including a lack of environmental due diligence on:

  • Soya beans bought from third-party traders, which make up 42% of all Brazilian soya Cargill purchases.
  • Soya beans owned by other companies that passes through Cargill ports.
  • Indirect land use change.
  • Soya sourced from the Cerrado savannah.
  • Soya sourced from the Brazilian Atlantic Forest.

ClientEarth also cites reports alleging Cargill suppliers have been involved in rights violations of Indigenous, Afro-Brazilian and other forest-dependent communities.

Cargill told the Guardian it had not seen the full complaint but it had an “unwavering commitment” to eliminate deforestation and conversion in South America. In line with this, it added: “We do not source soy from farmers who clear land in protected areas and have controls in place to prevent non-compliant product from entering our supply chains. If we find any violations of our policies, we take immediate action in accordance with our grievance process.”

The company’s website notes: “Cargill is committed to transforming our agricultural supply chains to be free of deforestation by 2030. Our policy on forests lays out our overarching approach to achieving this target globally across our priority supply chains. It is founded on our belief that farming and forests can and must coexist.” A spokesperson added that Cargill was also “strongly committed” to protecting human rights in its operations, supply chains and communities.

However, journalists revealed last year that one of Cargill’s soya suppliers grows crops on land deforested and burned in the Brazilian biome. In 2020, the Guardian and partners uncovered evidence that Cargill supplied Tesco, Asda, McDonald’s, Nando’s and others with chicken fed on imported soya linked to thousands of forest fires and at least 300 sq miles (800 sq km) of tree clearance in the Cerrado savannah. Similar reports were broadcast this year by Sky News.

Source: The Guardian

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