Cameroon to lure multi-national oil companies to Bakassi Peninsula

Oct 28, 2002 01:00 AM

Revelling in its victory over the tussle for the ownership of the Bakassi Peninsula, Cameroon is now dangling incentives to lure multi-national oil companies to step up exploration activities in the area. This action comes on the heels of revelations by one of Nigeria's counsels at the International Court of Justice (ICJ) at The Hague where ownership of the lost Peninsula was decided, Prof. Epiphany Azinge, that Nigeria lost the case partly because Cameroon had in her custody a legal opinion by the Federal Ministry of Justice in 1977 which held that the Peninsula "belongs" to Cameroon.
Reports said Cameroon, which is now to claim ownership of Bakassi Peninsula courtesy of the October 10 ruling by the International Court of Justice (ICJ), was now reviewing its petroleum laws to back up the proposed incentives. The country is banking on exploitation of resources in the area to shore up its depleting hydrocarbon reserves.

Cameroon state owned oil company, Societe Nationale de Hydocarbures (SNH), the equivalent of Nigerian National Petroleum Corporation (NNPC), put total capital expenditure on exploration and production this year at "several tens of millions of dollars as against just a few millions last year." The country is seeking to reverse a yearly 5 % decline in oil production, currently pegged at 110,000 bpd.
The review of the laws would see the government maintaining a 65 % production split in its favour and production costs calculated at an average $ 3.5 per barrel. It also seeks to replace the country's 1964 petroleum law that divided the contractual requirement into the “convention of establishment” between the state and the company and the “contract of association”, which fleshed out that relationship.

The SNH is banking on recently completed studies by French Institute of Petroleum consultant, Beicip, and UK geophysical outfits, ECL and Robertson Research International, which offshore prospectively in deep water oil gas. Aside from prospects in the Douala deep, there is the Rio del Rey bordering Nigeria, which Cameroon officials believed, held substantial oil and gas deposits.
Cameroon started production in 1977 with 318 wells drilled to date. This compared to Nigeria's over four decade of oil production with capacity now at 2.8 mm bpd. Nigeria too, is aiming to raise production to 4.0 mm bpd by 2010, and a reserve of 40 bn barrels. The bulk of Cameroon's production comes from ConocoPhillips, TotalFinaElf and Pecten (Shell). All were said to be planning extensive workovers and infield work in the coming months.

Major multinational oil companies in Nigeria include Shell, ExxonMobil, ChevronTexaco, Agip, TotalFinaElf, ConocoPhillips and Addax. The ICJ had in a majority ruling decided that, pursuant to the Anglo-German Agreement of March 11, 1913, sovereignty over Bakassi lies with Cameroon.
Furthermore, the court fixed the maritime boundary between the two countries, accepting Cameroon's contention by upholding the validity of the Declarations of Yaounde II and the Maroua, which Nigeria's former military ruler, General Yakubu Gowon and Cameroon's former leader, Ahmadou Ahidjo signed in 1971 and 1975.
The Nigerian government said the verdict was unacceptable, citing bias on the part of French president of the court, Mr Gilbert Guillaume. With Cameroon already upbeat to maximise opportunities presented by its control of the Bakassi Peninsula and Nigeria not ready to yield ground, the multinational oil companies, particularly the ones operating close to the borderline between the two countries, had expressed concern over the security implication of a potential face-off.

Companies affected include TotalFinaElf, ExxonMobil and Addax. Azinge, who is also a director at the Nigerian Institute of Advanced Legal Studies, told that Nigeria was paying for her carelessness. He explained that in 1962, the country voluntarily accepted full and unconditional jurisdiction of the International Court of Justice (ICJ) while it was not compulsory to do so.
At that point, said Azinge, "The legal team felt that look, we have come to a point of no return. Just go ahead," adding that whilst Nigeria was in a hurry to accept the court's jurisdiction, Cameroon was not. Rather, they built up their case in such a manner that it was clear they were working towards a long term objective. "You have an option to do so but Nigeria exercised their option by accepting full and unconditional jurisdiction of the International Court of Justice. Cameroon never did that. Cameroon accepted jurisdiction of the International Court of Justice on the 3rd of March 1994 and then filed their case in court on March 29, 1994, 26 days after they accepted jurisdiction of the court.”

He explained that if Nigeria had not accepted jurisdiction of the Court, "we would have had room to manoeuvre. Either to say that we are not party to the agreement, we do not accept the decision of the ICJ and we are not prepared to do so." He further revealed that in 1982, one Dr Maston of Leicester University was mandated by the Federal government to write a report on Bakassi, which was found unfavourable to Nigeria. In 1994, his opinion was again sought but still found Bakassi was not Nigeria's.
"Having said that we should also remember that the case, Bakassi case seem to have been hinged on an existing agreement. The 1913 Anglo-German agreement. If we were made to attack the 1913 Anglo-German agreement alone, possibly we would have been able to attack it in such a way that we can make persuasive arguments before the ICJ but there were so many other events.”
"People generally talk about the Maroua declaration of 1975, the one that Gowon signed. Yes, there was a Maroua declaration but there were so many other declarations. The Yaounde declaration, the Kano declaration, the Lagos declaration even before the Maroua declaration. Most of these things were stored by the Cameroons in their archives.”

"By the time the case started initially, in 1994, Nigeria was already on the wrong foot. The case was 99 % weighed against Nigeria. The point I want to make is that whatever the judgment of this case, Nigeria should learn from it and plan for long term instead of ad-hoc measures and fire brigade approach.”
"Cameroon systematically planned for this matter. You'll be shocked to know that if you go into the records when people realised the full import of the Maroua declaration as entered into by Gowon and Ahidjo they wanted to see if they could change it. Obasanjo tried in 1977. We have documents of the letter written by Major General Henry Adefope as the Minister of Foreign Affairs but Cameroon at that time felt they had gotten all they wanted from the Maroua declaration and said they wouldn't want to reopen the Maroua declaration anymore.”
"It is even more disturbing to know that even after the Maroua declaration of 1975, wherein it was agreed that the boundary should now be from point 12 to point G, Ahidjo had to write back shortly after to state that they noticed some errors and they would want Nigeria or the then Head of State, General Yakubu Gowon to make sure that the errors were properly reflected. It is also on record that we wrote back to say that yes, we acknowledge the errors and we hereby correct the them.”

"A document that was patently defective as far as Nigeria's interest was concerned was again amended in such a way to further suit the purpose of Cameroon and immediately they got that all subsequent Heads of State that tried to reopen the matter were rebuffed by Cameroon.”
"What did they do? By 1981 they went to the General Assembly of the United Nations and filed the Maroua declaration as an agreement. It became more or less like a treaty. The weight attached to it was now more than an ordinary agreement or declaration as we call it. That further worsened the position of Nigeria," said Azinge.
Continuing he said: "I saw maps of Nigeria in possession of Cameroon wherein Bakassi was said to be for Cameroon. Maps prepared by Nigeria. I have seen Federal Government surveys. The Coker chart wherein Bakassi was clearly stated to be Cameroon’s. So what are we talking about?"

Source: This Day
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