[Marxism] Oil company rot in Equatorial Guinea
lnp3 at panix.com
Sat Dec 18 07:17:37 MST 2004
(An article by Ken Silverstein, who founded Counterpunch a few years ago,
before taking a job with the Los Angeles Times.)
LA Times, December 18, 2004
Oil Firms' Rich Concessions to Tainted African Ruler Probed
By Ken Silverstein, Times Staff Writer
WASHINGTON Six years ago, the president of Equatorial Guinea was invited
to invest in a promising venture with one of the U.S. oil giants tapping
his tiny nation's reserves.
Mobil Oil Corp. offered the West African leader a stake in an oil trading
business for $2,300, according to documents the company filed with a Senate
subcommittee that were released last month.
Now, the company says, that stake is valued at about $645,000.
Mobil, now part of Exxon Mobil Corp., was not alone in sharing the wealth
with President Teodoro Obiang Nguema Mbasogo, whose regime has been accused
of massive corruption and human rights abuses.
Business ties between Obiang and seven U.S. oil companies, including real
estate leases and investment in energy production facilities, are the
subject of a probe by the Securities and Exchange Commission, according to
the companies and lawyers familiar with the investigation. Attorneys
familiar with the Foreign Corrupt Practices Act say the investigation
involves the broadest examination of the oil industry's overseas practices
since the law was passed in 1977.
Exploration by U.S. companies in Equatorial Guinea, previously an obscure
cocoa producer, began to pay off in the late 1990s as the U.S. sought new
sources outside the turbulent Middle East to meet its rapidly growing
demand for foreign oil. The effort intensified after the Sept. 11, 2001,
attacks and again after the invasion of Iraq last year.
The hunt for energy has pushed Washington and the oil industry into
relations with regimes in the former Soviet Union and West Africa whose
records on human rights and corruption are similar to those of traditional
U.S. suppliers in the Middle East.
Under the Foreign Corrupt Practices Act, American companies can do business
with government officials but are not allowed to provide anything of value
to anyone who can misuse a position of power to help them obtain or retain
U.S. government scrutiny of business relations with Equatorial Guinea grew
out of a money-laundering inquiry begun in 2003 by the Senate Permanent
Subcommittee on Investigations on accounts held by the country at Riggs
Bank in Washington. The biggest account contained hundreds of millions of
dollars in oil revenue deposited by American companies, according to the
That report, along with documents from lobbyists and an industry-funded
trade group and interviews with former U.S. officials, show that the
companies made multimillion-dollar deals with Obiang and his relatives and
helped them win political support in Washington.
Oil companies feted Obiang at Washington affairs attended by federal
officials and helped broker meetings between members of the Bush
administration and regime officials. The companies lobbied to reopen the
U.S. Embassy in Malabo, Equatorial Guinea's capital, which had been closed
since 1995. That was in part because of the country's dismal human rights
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