Oil: Can Uganda avoid Ghana's gold curse?

By Stephen Nuwagira

The discovery of minerals or oil and gas in any country excites citizens and leaders because confirmation of commercially-viable quantities of the resource could be a harbinger of an improved economy and livelihood.But problems come when law-makers draft policies that do not properly guide on the use the money accruing from the resource or how to exploit the resource sustainably. 

This has led to destruction of the bio-diversity in resource-rich areas and betrayal of the citizens’ expectations as communities in these areas continue to wallow in poverty, with poor social amenities and low standards of living.

Such a situation is what is being experienced by the Teberebie community in Nsuaem, Tarkwa constituency in Ghana’s gold-rich Western region, and could rear its ugly head in Uganda’s resource-rich regions if the Government does not ensure sustainable exploitation and proper use of oil returns.

Although Ghana started mining gold in the area decades ago region is poorest in the whole country. The area also suffers environmental degradation and soil and water contamination, thanks to mining activities. 

AngloGold Ashanti, a South African-based mining firm, operates in the affected area.

According to Emelia Amoateng, a local activist in the Wassa Fiase traditional area (in Tarkwa constituency), the people were displaced when their land was appropriated and resettled in the neighouring villages, whose soils are not fit for farming as they are contaminated. As a result, they have had to walk about 10km to access agriculture land.

“This has greatly hurt and altered our way of life and means of livelihood. This, coupled with lack of access to safe water, is almost crippling the community,” Amoateng says.

This situation relates well with what is going on in the Albertine Graben, where Tullow, CNOOC and Total are about to start commercial oil production, and the Kigezi region, where there is tin, wolfram, limestone and iron ore prospecting and mining.  

According to Jackson Wabyona, the chairman of the Bunyoro Local Oil and Gas Advocacy Group, exploration activities are hurting the lives and livelihood of fishing communities around Lake Albert. 

“At times they tell people not to fish in certain parts of the lake without giving them prior notice. This is compromising people’s livelihood as the communities mostly depend on fishing to generate income,” he says.

He adds that service providers contracted by Tullow Oil, especially transport firms, are contaminating streams in Hoima, where residents fetch water for home consumption. “This is against international standards, which the companies are supposed to adhere to. We have talked to Tullow, but nothing has been done so far.”

Wabyona says the firms are stubborn, arrogant and adamant, and blames their insolent behaviour on the Government, claiming it is shielding them from scrutiny. 

He also points out that land takeovers have left many people homeless, claiming the Government gazettes people’s land for exploration activities, but takes long to compensate them. He notes that some people, whose land was gazetted about three years ago, have not yet been compensated.

The energy ministry last week unveiled a plan on how it is going to compensate people who will be affected by the building of an oil refinery in Hoima. But some people who claim their land was taken over to give way for oil exploration, are still waiting for compensation.

Wabyona urges the Government to be open and involve all the stakeholders, especially on issues that directly affect them. He also calls for affirmative action for frontline communities to be given priority when recruiting employees. 

Also, Dozith Abainomugisha, the petroleum production boss, says the ministry is drafting policies to ensure that environmental degradation and other harmful effects associated with oil production are curbed. He says the petroleum department is working with the National Environmental Management Authority (NEMA) to develop a national oil spillage contingency plan and a strategic environmental assessment plan, which will be in place before oil production starts. He notes that they are also working on others safety measures to limit negative impacts that could result from oil and gas production.

Abainomugisha also points out that because oil production covers a small area, it is unlikely to cause huge environmental destruction if the guidelines being developed by the ministry and NEMA are implemented to the letter.

The Albertine Graben, where major oil and gas exploration has been taking place since 1998, is a bio-diversity hot spot. 

These activities are also said to be hurting and disrupting wildlife. According to a recent study conducted in Hoima by Columbia University’s School of International and Public Affairs students led by Professor Jenik Radon, “the elephants in the Albertine Graben are leaving” due to the drilling and vibrations. The same issue was recently raised by MPs on the parliamentary natural resources committee. Some birds, which were endemic to the western lift valley, are also said to have migrated to other noise-free places.The Colombia University survey involved local authorities and residents from the Albertine Graben.

Bukenya Matovu, the head of the communications department at the energy and mineral development ministry, says before any mining or exploration activity is carried out, a thorough environmental impact assessment is done to ensure that the operations do not hurt the community and the environment. He adds that the ministry also employs rigorous checks continuously to deter any negative effects of either mining or oil exploration and development activities.

“We have experts in the Albertine Graben who monitor these activities on a daily basis. Besides, all the activities in the mining, oil and gas sector are conducted according to the laws that govern the sector. These include the NEMA, Land, Wildlife and Local and Compensation Acts,” he explains.

He dismissed claims that government officials, who are expected to monitor oil companies, have been compromised, saying the officials are well paid and facilitated. 

Also, when projects of this magnitude start, it is envisaged they would provide jobs to the locals. But this has largely not been the case as many of the youth in Uganda’s and Ghana’s resource-rich communities are not given priority when the firms are recruiting workers.

According Wabyona, the recruitment systems used by oil firms do not favour the frontline communities. “Ordinarily, they should be the main beneficiaries from such investment. But instead they wallow in poverty, are unemployed, lack basic essentials of life like clean water, and have been exposed to poisonous chemicals,” he said.  

Amoateng says local chiefs are compromised by the firms, leaving the communities exposed. In fact, Teberebie youth, angered by a flattering speech by the Wassa Fiase traditional area chief, booed AngloGold Ashanti officials who were trying to paint a positive picture of their contribution to the area’s development. The youth accused the traditional chief of being a puppet of the mining firms. 

They also said the dust produced by the mining activities had caused an incurable whooping cough. 

However, Ashanti AngloGold officials played ignorance, arguing that there is a platform for the locals to voice their complaints so that they are solved.

“We have to know for us to take action. There has to dust and we have to use blasts as they are part of the operations. We are, however, happy the community has voiced its grievances, the fora at which they have done it notwithstanding,” says Emmanuel Baidoo, the AngloGold Ashanti sustainability manager, while reacting to the Teberebie community complaints.

Locally, Uganda’s officials charged with the monitoring of the oil companies’ activities are too few and do not have adequate skills to handle the challenges of the sector. 

“Petroleum production and exploration department and the National Environmental Management Authority (NEMA) officials are ill-equipped to handle the sector,” observes Fred Lukumu, the Buliisa LCV chairman during a telephone interview. 

Lukumu asks the Government to put in place measures to thwart any negative impacts resulting from activities of the oil and gas sector.

Experts note that whereas oil exploration is good for the country, a lot of bio-diversity is likely to be lost or become extinct if mechanisms are not put in place to produce oil in a sustainable manner. 

“The question of as to whether we can have oil production and maintain tourism attractions in these areas is another debate in itself. However, there is need to focus on how to manage the oil and gas resource sustainably, without negatively-affecting the bio-diversity,” they advise.

What is undisputed is the fact that if oil and gas exploration, development and production activities are not well managed, they will lead to dire consequences, including ground water contamination, release of gases and oil drilling chemicals to the surface, mismanagement of waste and the adverse health effects of pollution to humans and other life forms.

Meanwhile, Nelson Habasa, a Kabale-based natural resources management expert, notes that though the mining sector in the Kigezi region is mainly artisanal, it has hurt the environment. He says in most mining areas, hills have been stripped of soil cover by the artisanal miners, whom he says are not being regulated by the local governments in the region. “The miners do not cover the pits they dig up, which, when water collects, it leads to contamination of water points used by the frontline communities,” he says.
He points out that trucks which collect iron ore from Kaara in Muko sub-county, have destroyed the roads, hurting the marketability of local produce. He advises the Government to put in place strong policies to avoid resource curse as has been the case in many African countries.

 The writer and other senior business editors 
from Anglophone African were recently on a 
training tour of Ghana’s gold-rich western region