Vision 20/2020: A National Dream Achievable
What you're about to read is the full text of a recent address by the Nigerian Minister of Science and Technology. I helped to prepare the text and I saw in it, when I carefully read it later, a lot of optimism and positive disposition. I saw a paradigm: THAT NIGERIA WILL BE BIG AGAIN IS NOT THE QUESTION; THE REAL QUESTION IS WHEN AND THROUGH WHOM?
UTILIZING SCIENCE AND TECHNOLOGY TO DRIVE VISION 2020
INTRODUCTION
I am delighted to give the keynote address at this year’s Diaspora Day on the theme ‘’Nigeria and the Diaspora: Utilizing Science and Technology to Drive Vision 2020” and I consider this occasion an auspicious forum to welcome our fellow compatriots to a New Nigeria. I am proud to say that we have a focused government which is committed to taking the country to an enviable height. I am aware that some of us have been away from the country for quite some time now and may therefore not be conversant with the spirited efforts of President Yar’adua’s administration to reposition Nigeria amidst the comity of nations. While you were away, a lot of developmental events had taken place. No doubt, most of us have been keeping tab on the goings-on in the country either through news reports or via communication with relations. But the fact remains that most of what we know might be half truths and half truths cannot birth a meaningful development; hence, the need for us all to create a forum like this where issues bordering on our collective existence as a nation will be discussed. It is, therefore, a thing of joy that we are all counted worthy to be partakers of this event which started four years ago. I welcome you all warmly to this gathering of egg heads taking place in the heart of the famous Niger Delta.
Let me say here that this annual event must not be seen as a rite, which as a matter of necessity must take place. Rather, we should see it as an opportunity to appraise where we are coming from, where we are and intellectually project into the future. This government is clearly charting the path we should all follow through the development agenda tagged Vision 20/2020, which is specifically designed to leapfrog our country into the rank of the twenty biggest economies in the world by year 2020. But to achieve this, we must all be reminded that developing countries that successfully transited from the backwaters to the industrial delight necessarily attached great importance to Science and Technology. India offers one good reference point here. Years back, India belonged to the club of backward economies. Today, the story has changed. India’s transformation did not happen by accident. Rather, it is the fruit of placing more emphasis on the development of human capital with a strong recourse to Science and Technology. India, we all know, benefited immensely from the IT revolution flagged off in the 90s. Other examples abound. We cannot afford to stagnate while other nations advance. Ladies and gentlemen, we must buy into this vision and our gathering should therefore begin to look critically at how to harness Science and technology to realize the 7-Point Agenda of Mr. President.
S&T AND NATIONAL DEVELOPMENT
The manner in which we will proceed in this gathering depends greatly on how we perceive science and technology and its role in national development. Traditionally, science is defined as systematic inquiry into the workings of nature with a view to understanding and directing these for human benefits while technology is simply taken as the application of science. Today, science and technology (S&T) are best perceived as a ‘twin-concept’ – meaning that one cannot exist without the other. It is now impossible to discuss issues about technology without mentioning science, just as it is impossible to pursue science without technology. In fact, science and technology have become so closely related that the one now depends on the other for its development. The concept of S&T today refers to the totality of activities that culminate in the application of original or derived knowledge for human benefits.
S&T combine human knowledge with the ability to produce and use tools and machines in order to solve real life problems. In our case, the immediate problems to solve are those of poverty and unemployment; and in the long term, to position our nation as one of the first 20 economies of the world in the next 12 years. Our challenge, now, is how we can use science and technology to achieve these clear objectives. The import of this challenge comes out more clearly when we remember that the main cause of the competitive gap between us and the so-called developed world is the creation and application of knowledge; and that the rules of competition today is more dependent on national capabilities to exploit resources rather than just gloat over possessing them. This is exemplified in the fact that many of the industrialised countries of the world today are poorly endowed with natural resources and less than friendly weather conditions. Yet, they have attained leadership in the world economy, essentially through the effective application of S&T. Ironically; the least industrialised nations are those with rich resource and favourable climatic endowments.
It is important for us to appreciate the potency of S&T to bring about significant changes in our local, state and national lives. Investments in S&T always pay off, sometimes immediately, but always in the long run. Specifically, countries like the United Kingdom and France benefited immensely from the industrial revolution in the 19th century, and the United States emerged from an agrarian economy into an industrial superpower in the 20th century, through the effective application of S&T. In fact, these countries invested quite heavily in people and factories, and their successes were based on carefully designed plans and strategies. Unfortunately, virtually all the available statistics show that while the rest of the world has advanced technologically, Africa has fallen relatively further behind.
GOVERNMENT, S&T AND VISION 20-2020
Fellow compatriots, as laudable as the country’s vision 20-2020 is, it behooves us all as concerned citizens and key stakeholders that certain areas of our national lives are critical to the realization of our collective aspiration of being among the first 20 economies by the year 2020. Let us, for a moment, reflect by asking ourselves: exactly what does it take to arrive at this destination? where do we stand presently? and how do we proceed from here? The convocation of this forum lends credence to our common realization that science and technology will play a critical role. Notwithstanding, at national level, we need to take definite actions in specific areas if S&T must help us to deliver on our national aspirations. It is known, for instance, that a country’s innovation capacity – that is, the ability to create and/or apply new knowledge to solve practical problems – greatly depends on four indices: the country’s level of technological capability; the formal and informal institutions as well as their supporting systems; physical infrastructure; and an advanced knowledge infrastructure.
Using the above criteria, our dear country currently stands at 71st position out of 75 countries in a recent rigorous assessment by one of our own, Prof. Banji Oyelaran-Oyeyinka, who currently heads UN-HABITAT in Nairobi, Kenya. The message is clear: we have a long way to go. Surpassing 70 countries (among whom are South Africa, China, Israel, Malaysia etc) in 12 years is no mean feat. . In terms of GDP per capita, we are ranked 12th among the top-rated potential top 20 economies by 2025, and in terms of GDP growth, we are ranked 8th (Table 1). The need for us to pay attention to the key areas that determine our national capacity for S&T-driven growth, as earlier mentioned, is now urgent.
Table 1: Basic Facts about selected entrants into the top 20 economies by 2025
Population
Literacy
Poverty
GDP
GDP Growth
Teledensity
Power
Generation
Million
(Adult%)
(Level %)
$ per cap
%
%
bnkwh
China
1,330
91
8
5,300
11.4
63
3,260
India
1,150
61
25
2,700
9.2
23
662
Vietnam
86
90
14
2,600
8.5
51
596
Philippines
254
97
30
3,400
7.3
20
542
Egypt
81
71
20
5,500
7.0
36
103
Kenya
38
85
50
1,700
7.0
18
5.5
Pakistan
168
50
24
2,600
6.4
41
90
Nigeria
140
68
70
2,000
6.4
30
23
Ghana
23
58
28
1,400
6.4
24
7
Malaysia
25
89
5
13,300
6.3
95
83
Indonesia
238
90
17
3,700
6.3
33
126
South Africa
44
87
50
9,800
6.1
101
264
Iran
66
77
18
10,600
5.8
54
170
Bangladesh
153
43
45
1,300
5.6
13
21.4
Brazil
191
87
31
9,700
5.4
72
400
Source: Adapted from Maduka (2008)
Nigeria’s economic potential is well recognized. It is the biggest economy in the West African sub-region and has one of the highest GDP figures in the continent (Figure 1). Given the country’s considerable resource endowment and coastal location there is potential for strong growth. And in recent years, Nigeria has been experiencing an unprecedented growth turnaround and conditions seem right for launching onto a path of sustained and rapid growth, justifying its ranking amongst the “Next 11” countries. These are the countries identified by Goldman Sachs to have the potential for attaining global competitiveness based on their economic and demographic settings and the foundation for reforms already laid.
The previous administration had declared the intention to pursue the vision of placing Nigeria among the 20 largest economies in the world by 2020 and the current administration is committed to the attainment of this vision by setting up high-powered committees in this regard. The first is the NATIONAL COUNCIL ON VISION 2020 (NCV2020). The National Council on Vision 2020 is at the apex, providing leadership and direction to galvanize the whole nation, with the President as the Chairman. Others are the NATIONAL STEERING COMMITTEE (NSC), NATIONAL TECHNICAL WORKING GROUP (NTWG) AND THE STAKEHOLDERS DEVELOPMENT COMMITTEE (SDC). This is in addition to the identification of critical national priority areas referred to as the 7-point Agenda by the Yar’adua administration. These areas cover critical infrastructure, food security, human capital development, wealth creation, national security and intelligence, land tenure changes and the Niger Delta. In making this a reality, science and technology has to play a key role. This has been shown in the economies of the Newly Industrialized Countries (NICs). Recognizing this, the Federal Government recently inaugurated the Science, Technology Fund Committee made up of eminent Nigerians and technocrats. The committee is made of eminent Nigerians and Chaired by Professor Oluwafeyisola Adegoke, a brilliant scientist and Chairman of Governing Board of the Nigerian National Merit Award. The committee is expected to advise government and facilitate the establishment of Science, Technology and Development Fund (STDF) especially the joint management and administration of fund. The fund when established will help translate research results with commercialisable prospects into marketable products. The fund will also be used to give seed capital to young scientists to start new businesses. Together with this, government will, in the immediate, aggressively develop S&T human capital from the bottom up by increasing significantly the S&T content of our school curricula. We will also pay critical attention to the creation of an enabling environment through adequate infrastructural development.
DRIVING THE VISION WITH S&T: ENGAGING THE DIASPORA
Ladies and Gentlemen, look around you and you will see absolutely no area of our national life where S&T does not have a role to play. We at the Federal Ministry have realized, and in the last 3 to 4 years we have committed ourselves deeply to driving our national dreams and aspirations with S&T. Let me mention some key areas in which the Ministry is currently leading action, and where, I believe, our compatriots in the disapora can make significant contributions:
- Nanotechnology: this is geared towards renewable energy production and medical therapy.
- Advanced Manufacturing Technology: geared towards revamping the ailing industrial sector of the economy. You will agree with me that this sector is our sterling hope for achieving the vision.
- Space and ICT: we know that space technology has wide applicability in our economy. For instance, I can tell you about 13 sectors where we can immediately and directly apply space technology. ICT applications are specifically directed towards e-governance, e-commerce and e-administration.
- Biotechnology: developing drugs and useful enzymes from our abundant natural plants. Our successes so far include the famous sickle-cell medications developed, patented and packaged by our agencies
- Atomic Energy: our target is to generate up to 20 000MW of power the year 2017, and we believe it is possible. In fact, right now, our National Atomic Energy Commission is committed to training 2000 young Nigerians and 11 Nigerian universities have been designated as Centres of Excellence in this regard.
- Innovation Studies: we are systematically mapping the innovativeness of our industrial sector with a view to better understanding the problem and designing evidence-based policies.
In all of these areas, the government is making concerted efforts to strengthen the concerned agencies and parastatals. We are also committed to developing the capacity of these institutions to create and absorb new knowledge through R&D. We therefore invite you all to partake in this success-bound journey. You can be directly involved in areas where you have expertise. At the same time, it would be highly beneficial if you get some of your friends and associates out there to help you in building your fatherland. Remember that you have been doing that for them since you sojourned there! Now, every agency and parastatal of the Federal Ministry of Science and Technology has an active and regularly updated website through which you could get information directly from and to them. That way, much of the bureaucracies that we have always complained about can be skipped. By next year when we shall gather again, we want to be able to list the names of those Nigerians in the diaspora who have done something; and I promise you, nothing that you do will be overlooked, no matter how little. The time to act is now.
THE ROLE OF THE NIGERIAN DIASPORA
In meeting the challenge of improving the Nigerian economy the role of the Nigerian Diaspora cannot be overlooked. Our brothers and sisters, compatriots who have excelled in their various trades and professions overseas, need to partner with us extensively in the areas of human capital formation, infrastructural development and demand-driven research and development (R&D). I am particularly excited that this annual conference offers an opportunity for that to occur. The requirements of our vision are enormous and we could use all the help we can muster, especially from our kindred who live and work abroad. A good place to start is to attract foreign direct investment into the country. I am glad to say that the business environment in our country has indeed improved and it is now easier, more than ever before, to invest in Nigeria. Rather than make and spend all our money abroad, there are opportunities to develop our fatherland through investments. This government is one that is willing to engage willing development partners every step of the way. Therefore, we would enthusiastically embrace profitable public-private partnership initiatives.
The place of human capital cannot be overemphasized in the quest for national development. This is another key area that our compatriots in the Diaspora could be of immense assistance. Creating and/or supporting local manpower development institutions would be greatly beneficial for the common good. One such commendable initiative is the establishment of centres of excellence in ICT training by AfriHub LLC. The contributions of our nationals such as Prof. Wole Soboyejo to the creation and operation of the Mandela Institute for Knowledge Building and The Advancement of Science and Technology in Sub-Saharan Africa by our own is also worthy of mention. Let me state emphatically that there is still room for much more. Endowing scholarships, fellowships, university chairs and foundations are also very useful. Let us join hands to create the critical mass of S&T human resources that our nation needs urgently to develop.
CONCLUSION
At this juncture, let me once again remind us before I leave this podium that we should all join hands together to ease the pains of today while working for the gains of tomorrow. Let us set aside cynicism, and strive for the good society that we know is within of our reach. We should jettison the habit to low expectations of ourselves as well as our leaders. Let us stop justifying every shortcoming with that unacceptable phase, “the Nigerian factor,” as if to be a Nigerian is to settle for less. Let us capture the mood of optimism that defined us at the dawn of independence, that legendary can-do spirit that marked our Nigerianness. Let us join together to build a society worthy of our children. We have the talent. We have the intelligence. We have the ability. But we have to be aware of one fact: It is not what we know that matters but what we do with what we know. Our country needs us all. Together we shall realize the country’s Vision 2020. It requires our commitment and strong conviction. And I believe Science and Technology is a veritable tool to drive it.The Government of President Yar’adua is committed to providing the political will.
Thank you and God bless for your rapt attention.
Dr Ismail Aby Jamal
Born in Batu 10, Kg Lubok Bandan, Jementah, Segamat, Johor
Monday, December 1, 2008
Liquefied Natural Gas and Fossil Capitalism
Liquefied Natural Gas and Fossil Capitalism Anna Zalik
The contemporary ecological crisis places a new spin on the notion of the “resource curse,” evoking widespread concerns regarding hydrocarbon dependency. Whether environmental, in the form of global warming, or socio-political, through wars over oil, “fossil capitalism” is now understood as a global problem.1 The development of a global market in natural gas, heavily dependent on the development of the Liquefied Natural Gas (LNG) industry, offers an example of a corporate-endorsed solution to the simultaneous ecological and economic “crises” associated with fossil capitalism. Yet, since 2004 a cross-continental mobilization against the development of LNG terminals in North America has successfully challenged the installation of some LNG infrastructure on the West Coast.2 These movements stress that the investment required to build the global gas industry displaces investment in renewables.
A key limitation on natural gas usage is the difficulty of transportation, particularly across oceans and over long distances. LNG is natural gas that has been cooled for purposes of transportation to approximately –163°C (–260°F), changing it from a gas to a liquid 1/600th its original volume. It is shipped in double-hulled seagoing vessels known as LNG carriers designed specifically to handle the low temperature of LNG. There are currently now more than 130 such ocean carriers in operation worldwide. Receiving or gasification terminals take the form of specially constructed ports devoted exclusively to the importing and exporting of LNG. Once it reaches its destination it is stored in insulated tanks built specifically to hold LNG. When there is demand for fuel the LNG is heated to return it to its gaseous state and delivered via pipelines as natural gas to customers. LNG is exported by countries with large natural gas reserves such as Algeria, Australia, Brunei, Indonesia, Libya, Malaysia, Nigeria, Oman, Qatar, and Trinidad and Tobago. There are some sixty LNG receiving terminals worldwide, mainly in high-income consuming nations such as Japan, Korea, the United States, and some European countries.
As the “cleaner” hydrocarbon, natural gas has been promoted as a partial solution to the problem of global warming. As the ecological critique of carbon-based fuel consumption grows louder, with supply concerns prompting energy price increases and OPEC members claiming greater sovereignty over petroleum assets, natural gas appears increasingly attractive both financially and environmentally. Multinationals displace lost oil reserves with gas, while they market themselves as greener energy companies (the most notable being BP’s new moniker: Beyond Petroleum). Daniel Yergin, Pulitzer-winning author of the book The Prize on the oil industry, referred to natural gas as “The Next Prize” in a 2004 article in Foreign Affairs. Making it prize-worthy, however, depends on LNG development that is high-risk, costly, and inefficient.
David Harvey’s theorization of the “spatial fix” provides insight into the formation of the global LNG market, since it is by nature a global industry, associated with overseas transport of fossil fuel. Although technically difficult, LNG development helps the oil and gas industry address some of fossil capitalism’s contradictions while creating others. The investment of surplus in LNG infrastructure allows for the use of excess capital in specific sites. Concurrently, certain social contradictions of the “state-tied” resource curse are avoided, transferring the product out of relatively insecure settings and into more profitable ones. Given rising criticism of the oil and gas industry, however, the promotion and connection of LNG to the North American power grid must be accomplished. So industry aims to persuade legislators and the public that LNG has some intrinsic value in terms of conservation, the environment, and energy security. But providing a convincing argument for LNG could become increasingly difficult with recent assertions that drilling for shale gas in the United States could preclude the need for these imports.
The analysis below examines how the LNG industry is commonly conceived as a partial, stop-gap solution to the ecological and economic crises arising from fossil-fuel dependence. By looking at the overseas transfer of LNG from Nigeria to Mexico in order to power the U.S. energy grid, this article seeks to explain ongoing spatial transfers associated with “ecological imperialism.” Mexico’s first LNG terminal, operational since 2006, is a Shell project in Tamaulipas State, which borders Texas, sourcing gas from its Nigerian LNG facility in Bonny Island. LNG development in the two sites in Nigeria and Mexico has interfaced with varying social conflicts and positions in the global political economy of oil — in the Nigerian case, highly volatile, in the Mexican relatively stable. Fostered by corporate subsidies, the gas ultimately enters the more lucrative U.S. market, servicing that country’s hydrocarbon-accumulation model.3
The Resource Curse
Although the term “resource curse” seems an apt descriptor for the global pitfalls of hydrocarbon dependency, in its original usage it had a decidedly state-centered focus. The curse describes how exporters of high-valued natural resources become tied to a single major source of revenue in a form that stymies their domestic economic growth. Classic examples of this dynamic in the oil sector include Nigeria, and Venezuela up until the late 1990s. Sometimes called the “paradox of plenty,” this condition is associated with the accumulation of high-value natural-resource based capital in a particular state. The rapid accumulation of surplus through exports of this resource erodes social cohesion, encouraging spending on conspicuous consumption and imported goods rather than industrialization. Socially, this leads to magnified inequality as powerful elites claim “rents,” or kickbacks, in a cash-flooded national economy.4
The state socio-economic erosion associated with the “curse” includes deteriorating public services and infrastructure. Often, due to the consumption culture that the curse is said to foster, poor services are attributed to corrupt actors in commercial and governmental institutions. But the deterioration of infrastructure cannot be attributed merely to acquisitive values or—as often implicit in contemporary charges of corruption against developing countries—to “laziness” (a stigma laden with colonizing stereotypes). In fact, the concept of Dutch Disease, often equated with the resource curse, was coined to describe the deterioration of the Netherlands following the gas boom of the 1960s. And a similar curse has been used to explain the centuries-earlier deterioration of the Spanish economy as a result of rampant extraction of silver and natural wealth from the Americas. The rising exchange rate that results from accumulation during a boom period prompts de-industrialization, as manufacturing and agricultural sectors become less competitive on the global market, and even domestically. In various third world oil exporters, this phenomenon has encouraged divestment from these sectors, leading to “underdevelopment.”
Interestingly, those oil producers commonly identified as having “escaped the curse” include Mexico, where oil came under national control after the expropriation of foreign oil holdings in 1938.5 Mexican petroleum production after the expropriation was initially intended to be directed toward national industrial development in accordance with an import substitution model, although this was later to break down as a result of U.S. economic dominance, creeping privatization, and neoliberalism.
In contrast to the explicitly developmentalist and import-substitution model that prevailed in Mexico, advancing de-industrialization, associated with high-value resource extraction and the related export dependency, makes most resource-cursed countries less attractive sites for reinvestment of the energy and capital surplus extracted.6 In Nigeria, despite considerable need for domestic gas as a cooking fuel, gas associated with the oil extraction is primarily being liquefied for export. The transformation of Nigerian gas into LNG makes it a globally tradable substance—serving European and North American markets far afield. Contemporary military advances into West Africa through the expansion of the U.S. Africa Command, and the UK’s recent offering of policing support to assuage the Niger Delta crisis, echo the imperial histories of these regions. Indeed, historical and contemporary extraction of natural resources from these regions and the socio-political strategies that facilitate it may well be explained as ecological imperialism.7
Harnessing Gas
The construction of a global gas market, complete with dedicated LNG terminals, requires that legislators and a public wary of energy companies must first be convinced of its economic and environmental benefits. Moreover, particular technology must be put into place to move it trans-oceanically. As described by Gavin Bridge, the properties of gas as an ethereal substance shape a “stubbornly anachronistic geography of commodity supply.” Where terrestrial pipelines cannot be installed, overseas shipment demands liquefaction at extremely cold temperatures, allowing its transport on special tankers to distant terminals. Once it arrives at its destination, the substance is regasified and linked into domestic power grids.
Whether piped or shipped, this is an expensive undertaking and, until the recent upsurge in energy prices, much gas was considered “stranded” since the process was considered too costly to be viable.8 Today the context has changed, with concerns regarding a global fuel shortage prompting rising prices on gas futures markets that are beneficial for the promotion of LNG development. In the last ten years the international oil industry has placed a major emphasis on the development of LNG terminals and infrastructural connections in North America. Although there is widespread consensus that natural gas is preferable to coal burning for electricity generation, LNG is a doubtful candidate for an overall reduction in carbon emissions. Recent studies suggest that the carbon footprint of LNG transported long distances may be substantial.9 Building a North American domestic LNG infrastructure will also shape a set of commercial and worker interests tied to this industry, which may further postpone and/or create obstacles to non-hydrocarbon sources as a substitute.
Although LNG currently accounts for only about 30 percent of the inter-regional trade in gas, the International Energy Agency estimates that the figure may rise to 50 percent by 2030. National oil companies play a large role in gas liquefaction, with Indonesian and Brazilian parastatals among the most important. But Shell also figures in the top three for liquefaction capacity, and private energy companies primarily run LNG receiving terminals.10
LNG in Nigeria and Mexico and Capital’s Spatial Fix
The Nigerian LNG project at Bonny Island—a joint venture between the Nigerian National Petroleum Company, Shell, ENI (Agip) Italy, and Total—was first proposed in 1989, and became operational a decade later. The liquefaction and export of natural gas is the Nigerian oil industry’s external solution to the problem of flaring in the Niger Delta—where 70–80 percent of gas extracted alongside petroleum (known as associated gas) is burned, the highest rate in the world—leading to acid rain and erosion that effects fishing and local wildlife. Huge surface flares light up the night sky. Since the Ogoni mobilization and Ken Saro-Wiwa’s execution in the 1990s, these flares have become symbolic of the impunity with which environmental and human rights norms are disregarded by the global oil industry in Nigeria.11 Flaring occurs at a rate of at least 2.5 billion cubic feet per day with many riverine villages “never knowing a dark night.”12 Shell Nigeria is the largest single flarer.
Unsurprisingly, after fifty years of ongoing flaring, this industrial form of waste elimination is an indelible part of the region’s socio-ecology. Condemned by the Ogoni, Ijaw, and other Nigerian “oil minorities” as a violation of indigenous rights, flaring in the Delta is seen as a clear manifestation of environmental racism, or “global apartheid,” as applied to the exploitation of natural resources. In protest against oil extraction in the Delta in 1999, Ijaw youth initiated “Operation Climate Change” whose aim was to “extinguish the flares.” In the context of a history of harsh repression of protests and blockades, and the increased presence of militia groups acting as both security and threat to the oil industry, resistance in the Delta has been radicalized. In the last two years media reports on precarious oil supplies include references to the violent Deltan “crisis.”13
In addition to the release of toxic chemicals into the atmosphere, attention to global climate change makes flaring practices in the Delta a further target of criticism: The World Bank estimates that, due to flaring, Nigeria had contributed more greenhouse gases to the atmosphere than all other Sub-Saharan African countries combined by 2002. Environmental advocates inside and outside Nigeria have condemned the possibility of using flaring elimination to gain carbon credits (i.e., World Bank Clean Development Mechanism financing) under Kyoto, employing a recent Nigerian High Court ruling defining flaring as a violation of human/environmental rights and illegal on that basis.
The actual site of the LNG plant, Bonny Island, was a key port for the Trans-Atlantic slave trade—the lasting impact of which some theorists believe helps explain the salience of tribal divisions in the contemporary Nigerian state.14 On Bonny Island itself, an ecologically protected area at Finima was established as a requirement of the Nigerian LNG Environmental Impact Assessment. This protected area is administered by a Nigerian environmental NGO.15 The Nigerian LNG project and the public affairs programs it has advanced are today deployed as industry-community models, departing from divisive “host-community” policies which stoked inter-communal violence, and promoting improved social and environmental performance.
However, the harsh reality is that competitive violence over oil industry access payments and “piracy” (or contraband oil trade) in the Bonny region has continued, including kidnappings of Nigerian and expatriate oil workers. The marketing of the product elsewhere allows it to escape a region marked as too risky for domestic infrastructural investment. Concurrently the transfer of LNG allows capital an opportunity to engage in a kind of “spatial fix,” overcoming an over-exploited “socio-nature”/resource base, and a regime of overaccumulation of capital through the sale of LNG abroad.
The shipment overseas of LNG from Nigeria to Mexico allows the oil industry to benefit from the latter’s stability as well as its proximity to the largest domestic market in the world. Shell’s Altamira terminal in Tamaulipas State, of which it holds 50 percent—with Total and Mitsubishi holding another 25 percent each—is Mexico’s first regasification plant, operational prior to the Sempra/Shell terminal at Costa Azul. The port at Tampico, just South of Altamira, is a historical pivot in Mexican oil extraction. The broader Huasteca region of which it forms a part became famous for its “gushers” and was at once a “huge source of wealth and environmental destruction.” Its workers were central to the push for the 1938 expropriation of the former Shell and Standard Oil subsidiary companies—El Aguila and Huasteca.
Building on article 27 of Mexico’s revolutionary 1917 constitution, the 1938 oil expropriation put into practice the national exploitation of sub-soil resources. Through worker mobilization, and spurring major conflicts with the U.S. and UK governments, this expropriation was finally accepted, as it served U.S. financial interests. It provided Mexico the collateral to take out loans for industrial and infrastructural development. Not only did the expropriation express labor control over the means of production but, as Myrna Santiago demonstrates, it gave rise to an important conservationist sensibility—aiming to protect the resource for use by future generations of Mexicans.16
The Mexican expropriation marked a global turning point, the first case of a Southern oil exporter expelling multinational oil companies from its territory, over three decades prior to the creation of OPEC. But where OPEC would seek to control global prices of the commodity, Mexico’s expropriation expressed what would become a key tenet of Latin American import-substitution industrialization, the use of primary resources for national development rather than foreign exchange.
As LNG terminals are a prime strategic investment for foreign industry, they are also a target for contemporary protests against the denationalization of the Mexican oil industry. Since the Salinas de Gortari presidency, portions of the Mexican national oil company have been decentralized and in some cases privatized. These shifts occurred in a general economic climate that committed Mexican energy sources to rapid development, a condition of the U.S. financial bailout to the country following the 1994 peso crash that trailed the implementation of NAFTA and the Zapatista uprising. The marketization of LNG as “non-extractive” is in fact an important arena in the current debate concerning the creeping denationalization and privatization of the Mexican oil and gas sector—which has deepened in the aftermath of the highly contentious 2006 presidential elections taken by the conservative PAN in dubious circumstances. The Mexican Constitution continues to prohibit foreign or private firms from extraction and production of energy although not marketing. Thus the legality of LNG projects in Mexico has been challenged by various national groups, including coalitions of professional staff and democratic workers associations of the Mexican national oil company (Pemex), as a threat to energy sovereignty.17
The movement of LNG from Nigeria to a terminal in Mexico provides us with a window on the socio-ecological crises of hydrocarbon consumption and the industry’s contradictory attempt to resolve these crises. In Nigeria, industry and government frames LNG as a solution to social and ecological ills more easily than in the North American context. The infrastructural and social marginalization of the Delta region and the country as a whole makes its domestic energy sector unappealing for investors—despite a considerably underserved domestic market in natural gas. The violence that has become an indelible part of the Nigerian operating environment, attributable in part to the community affairs practices of the oil industry, is avoided while the outcry associated with the flaring of the region’s gas is discursively countered. Shipping the gas out of Nigeria and into Mexico is clearly a more lucrative option for an industry that purports to address the curse associated with hydrocarbon dependency nationally and globally.
LNG and its Discontents
Yet, the shifting of LNG to terminals in North America, where it will be available for the North American market and distributed under relatively stable conditions, has run into opposition. Over the last two years, a series of proposed LNG terminals in California and Baja California have been defeated due to sustained citizen protest—not a single terminal has been approved in California. Recently LNG terminals have been cancelled near Long Island, New York, in Oxnard, California, and near Ensenada, Baja California, and deferred in Canada. Active opposition to proposed terminals in Maine has spurred a regional coalition that includes the Canadian province of New Brunswick.18In 2008, the Clintons and Barack Obama acknowledged popular campaigns against planned LNG terminals in Oregon.19 Public opposition to the terminals has revolved around negative environmental impacts, the risk of accidents, and the threat of terrorist attacks on them. Mother Jones referred to them as “floating targets” in 2007.20
According to official U.S. sources, ten serious LNG accidents have occurred since the 1940s worldwide but with few fatalities. As such, Congress gave LNG land terminals a relatively safe rating in a 2003 report. In 2005 a Washington state-based public interest group took issue with the U.S. Federal Energy Regulatory Commission’s LNG safety approval. The report for the Pipeline Safety Trust counters that “for a variety of significant reasons, past operating records do not provide an appropriate perspective for the analysis of LNG risks. Overemphasis on past operations to predict future failures is a characteristic of poor risk management techniques, particularly for such complex systems.”21
While proponents of LNG portray it as “methane that is colorless, odorless and non-toxic,” environmental groups marshal contrary data.22 Not only does LNG include additional hydrocarbons like ethane, propane, and other contaminants, the receiving facilities bring together four major risks: high-energy density, huge inventories, unusual release dynamics associated with extreme cold (cryogenic temperatures), and very large impact zones of potential explosions.23 Official U.S. regulatory discourse describes LNG as “non-explosive” in its liquid state, a trait that does not differentiate it from other flammable liquids. But critics point out that LNG varies since it is held at unnaturally cool temperatures. A major LNG spill in Cleveland in 1944 resulted in a fire that killed 128 people. In its opposition to projects in Baja California, Greenpeace Mexico cited accidents at Staten Island in 1975 with a death toll of 45; a gas cloud in Boston in 1988, and an accident in Algeria—the second largest exporter of LNG globally—that killed 23.
Alongside socio-environmental risks, the West Coast coalition under the Ratepayers for Affordable Clean Energy (RACE) banner highlights how LNG projects largely serve to guarantee profits for crony energy companies. A former member of the California Public Utilities Commission called LNG development the “single largest change in the state’s energy infrastructure” since the 1950s.24 Were these projects to proceed, capital investment would tie the West Coast to gas rather than renewables, under the thumb of an energy sector already tarnished by price and supply manipulation during California’s 2000–01 energy crisis. Crucially, the role of the state regulators in pushing through LNG at the behest of key industry actors is openly condemned by the RACE coalition. They point to a California Public Utilities Commission ruling allowing utilities “the right to not renew contracts for domestic natural gas so these utilities can enter into LNG supply contracts, in essence favoring LNG from abroad over supplies from the Western United States and Canada.”25 The correct policy choice, argues RACE, is the continued usage of domestic gas sources that are more easily monitored for environmental impacts, less costly, and less hazardous than LNG receiving terminals. Concurrently, the demand for natural gas should be reduced via implementation of California’s clean energy laws and policies.
Though proposed LNG sources vary, many are typical extractive areas: economically and spatially isolated locations, communities socio-historically marginalized in racial/cultural and class terms, which may be ecologically rich but in which environmental regulations are relatively weak or minimally enforced. Among the early ecologically controversial LNG projects was a Royal Dutch Shell project on Russia’s Sakhalin Island marked as a threat to the Western Gray Whale. The Sakhalin II project prompted opposition in California from the organization Pacific Environment, which eventually spearheaded the establishment of the RACE coalition.
In the case of North American LNG, marginality is similarly desirable for terminal sites, especially in the midst of the “terror-target” hype. Accordingly, this makes Mexico a relatively attractive terminal site. In addition to lower labor and construction costs, certain industrial practices are tolerated that would be prohibited on the other side of the border. For instance, in Mexico LNG terminals may employ sea-water to warm the gas to normal temperature. Greenpeace Mexico’s campaign against LNG terminals, launched in 2004, employed a discourse of resource sovereignty as well as ecology, merging environmental movements with nationalist branches of the energy sector.26
To date, on the West Coast, only one LNG terminal has proceeded in the state of Baja California but not without a struggle. This is the Sempra facility that became functional in April 2008. Initiated by Shell Mexico, the company began to distance itself from the project in 2005, following opposition from a coalition that included both a Tijuana housewives association and a San Diego surfer’s club.27 Sempra then took it over, with Shell purchasing 50 percent of Sempra’s interests, but Shell’s name is not publicly associated with the terminal.28 Another proposed LNG terminal nearby in Puerto Libertad, Sonora has received support from the Sonora state government. According to the U.S. Department of Energy the latter has signed an agreement for a pipeline system to distribute the gas in both Mexico and the United States.
In Baja California, as in California, opposition to terminals is buttressed by the relatively advantaged sectors that oppose its development. On both sides of this border, these include tourism and real estate as well as the environmental movement which holds historical weight on the U.S. West Coast. In Baja California press attention was successfully harnessed, and a major Mexican television network produced a twenty-minute documentary critical of the LNG projects complete with ominous music. Following protest by a cross-border group of ecologists, NGOs, and fishing cooperatives, a proposed Chevron LNG terminal at the Islas Coronados, Baja California was cancelled in April 2007. The islands provide a habitat for a vulnerable marine bird, the Xantus, on which basis a case was taken to NAFTA’s Committee on Environmental Cooperation in 2005.29
California and Baja California resistance differs quite markedly from that on the Gulf Coast. Nine of the ten existing North American LNG terminals are located in the Gulf region and the northeast. Five are sited in Texas and Louisiana, one in Georgia, and two in New England. Louisiana and Texas share a long history of petroleum industry presence reflected in the relative amenability of those sites to receiving terminals.30 Of the ten, two are Mexican terminals: the aforementioned Sempra Costa Azul terminal between Ensenada and Tijuana and the one at Altamira, Tamaulipas. Tamaulipas shares the U.S. Gulf Coast’s long oil industry history, and its Huasteca region saw severe environmental degradation through the first half of the twentieth century.31 Over time the presence of the oil industry and a powerful national petroleum workers’ union has tied generations of Mexico’s Gulf State inhabitants to hydrocarbon production.
The Shell Tamaulipas LNG was initially to be supplied by Venezuela. But this project was cancelled in 2005, as Venezuela’s PDVSA (oil parastatal) took an increasingly sovereigntist stance regarding extraction, and removed both Shell and Mistubishi from its Mariscal-Sucre LNG project. It was under these circumstances that Shell Mexico moved to supply the plant from further afield—the Nigerian LNG project. The Nigerian-Mexican LNG relationship under the aegis of U.S. capital is thus partly a response of North American capitalism to limits imposed by Venezuelan resistance to foreign capital and embrace of regional energy sovereignty.
In the face of such resource sovereignty movements in the Global South, the movement of LNG from Nigeria to a terminal in Mexico—for U.S. consumption—is an example of the industry’s attempt to resolve the crises associated with on-going hydrocarbon extraction. It also manifests the ongoing transfer of “natural capital” that has been central to the development of global capitalism.32 In Mexico, LNG terminals face weaker environmental regulations and a (somewhat) less oppositional public than in the United States toward which the gas is ultimately destined. Yet the privatized nature of LNG development in Mexico is hotly debated, and figures prominently in struggles over the future of the Mexican energy sector and the national economy. As a global “band-aid” for fossil capitalism, the costs and complications associated with LNG thus attract increasing public scrutiny and critique.
Notes
Elmar Altvater, “The Social and Natural Environment of Fossil Capitalism,” in Leo Panitch and Colin Leys, ed., Socialist Register 2007 (New York: Monthly Review Press, 2006).
See http://www.LNGpollutes.org.
John Bellamy Foster and Brett Clark, “Ecological Imperialism: The Curse of Capitalism,” in Leo Panitch and Colin Leys, ed., Socialist Register 2004 (New York: Monthly Review Press, 2003), 186–201. David Harvey, The New Imperialism (New York: Oxford University Press, 2003), and Spaces of Hope (Berkeley: University of Califonria Press, 2000). Lorenzo Meyer, Mexico and the United States in the Oil Controversy 1917–42 (Austin: University of Texas Press, 1972).
Texts include Richard Auty, Sustaining Development in Mineral Economies (London: Routledge, 1993); Terry Lynn Karl, The Paradox of Plenty (Berkeley: University of California Press, 1997); and M. Ross, “Does Oil Hinder Democracy?” World Politics 53, no. 3 (2001): 325–61. See M. Watts, “Resource curse?” Geopolitics 9, 1 (50–80) for critique of some conventional approaches to the oil-conflict nexus and K. Omeje, ed., Extractive Economies and Conflicts in the Global South (Aldershot, Ashgate, 2008).
See for instance Lorenzo Meyer and Isidro Morales, Petróleo y nación (Mexico D.F.: Colegio de Mexico, 1990).
A problem that became more pronounced in the period following the debt crisis, a crisis that in fact resulted from the need for Northern banks to recycle the petro-dollars which Southern oil exporters deposited there during the oil shocks of the 1970s.
Foster and Clark, “Ecological Imperialism”; Jason W. Moore, “Environmental Crises and the Metabolic Rift in World-Historical Perspective,” Organization & Environment 13, no. 2 (2000): 123–57.
Gavin Bridge, “Gas, and How to Get It,” Geoforum 35 (2005): 395–97.
See Paulina Jaramillo, W. M. Griffin, and H. S. Matthews “Comparative Life-Cycle Air Emissions of Coal, Domestic Natural Gas, LNG, and SNG for Electricity Generation.” Environmental Science and Technology 41, no. 17 (2007): 6290–96.
Faith Birol, “LNG in the World Energy Outlook,” International Energy Agency Presentation to “Making Gas Market Global Workshop,” Paris, 2005.
See Ike Okonta, When Citizens Revolt (Trenton: Africa World Press, 2008); Don Pedro, Ibiba, Oil in the Water (Lagos, Foreword Communications,2006); Cyril Obi, The Changing Forms of Iden Nordiska Afrikainstitutet, Uppsala, 2001).
For detailed statistics see Environmental Rights Action Nigeria, (Friends of the Earth), Gas Flaring in Nigeria, 2005.
Ukoha Ukiwo, “From ‘pirates’ to ‘militants,’” African Affairs 2007 106, no. 425: 587–610; Peterside and Zalik “The Commodification of Violence in the Niger Delta” in Leo Panitch and Colin Leys, eds., Socialist Register 2009. (New York: Monthly Review Press, 2008).
Peter P. Ekeh, “Colonialism and the Two Publics in Africa,” Comparative Studies in Society and History 17 (1975): 91–112.
At Finima, the administering NGO often finds discarded pipes and other industrial waste on the protected site (author’s fieldwork 2003, 2006).
For further details on ecological destruction in this period see Myrna Santiago, The Ecology of Oil (Cambridge: Cambridge University Press, 2006), 133.
See http://UNTCIP.net.
See Tyler Hamilton, “Is LNG Flame Burning Out?” Toronto Star, April 12, 2008. Also See http://www.savepassamaquoddybay.org.
See The Daily Astorian, May 13, 2008. On visiting Astoria, Bill Clinton referred to Hilary’s opposition to the 2005 Energy Policy Act that placed approbatory power for LNG terminals with the Federal Energy Regulatory Commission. This is partially contested, see http://www.energycurrent.com/?id=3&storyid=9628.
James Ridgeway, “Homeland Security: Floating Targets,” Sept. 6, 2007.
Richard Kuprewicz, et al., Public Safety and FERC’s LNG (Bellingham, WA: Pipeline Safety Trust, 2005). The Pipeline Safety Trust was formed in 1999 following the Olympic Pipeline explosion near Bellingham.
http://www.ferc.gov/o12faqpro/default.asp?Action=Q&ID=464.
Kuprewicz, et al., Public Safety and FERC’s LNG. Various forms of LNG hazards are identified in the report—pool fires, flammable vapor clouds, and flameless explosions. In the case of pool fires the ignition of evaporating gas would lead to an increase in the “pool size” as LNG expanded away from its source. Due to inability to extinguish such a fire prior to the consumption of all the LNG at source, thermal radiation could injure people and property at considerable distance. If a similar spill does not ignite, it could drift some distance away where it might encounter a source of ignition and burn at varying degrees in various parts—dependent on concentration.
Loretta Lynch, formerly California Public Utilities Commissioner, http://pacificenvironment.org/article.php?id=2074.
The California Public Utilities Commission denied the RACE coalition’s demand for public hearings on LNG in the state. See Rory Cox and Robert Freehling, “Collision Course,” 24.
Greenpeace Mexico, Press Release, May 29, 2004. “To accept the Transnationals Liquefied Natural Gas project implies energy dependence, high risks and that we accept being the United States backyard.”
See http://www.surfrider.org.
See U.S. Energy Information Administration/Department of Energy, Mexico Country Analysis Brief, January 2007.
In a 2004 briefing on Mexican Gas projects, a business source highlighted Mexican Congressional opposition to the Chevron Islas Coronado project, twenty miles off the coast “under the argument that foreign multinational companies will end up having control of Mexican sovereign waters.” Haynes and Boone LLP, “Mexico’s Gas Markets.” Available at http://www.hg.org/articles/article_410.html.
William Freudenburg and Robert Gramling, Oil in Troubled Waters (Albany: SUNY, 2004).
On this point see Santiago, The Ecology of Oil.
Jason W. Moore, “Environmental Crises and the Metabolic Rift in World-Historical Perspective,” Organization & Environment 13, no. 2 (2000): 123–57; John Bellamy Foster, “Marx’s Theory of Metabolic Rift: Classical Foundations for Environmental Sociology,” American Journal of Sociology 2 (1999): 366–405.
The contemporary ecological crisis places a new spin on the notion of the “resource curse,” evoking widespread concerns regarding hydrocarbon dependency. Whether environmental, in the form of global warming, or socio-political, through wars over oil, “fossil capitalism” is now understood as a global problem.1 The development of a global market in natural gas, heavily dependent on the development of the Liquefied Natural Gas (LNG) industry, offers an example of a corporate-endorsed solution to the simultaneous ecological and economic “crises” associated with fossil capitalism. Yet, since 2004 a cross-continental mobilization against the development of LNG terminals in North America has successfully challenged the installation of some LNG infrastructure on the West Coast.2 These movements stress that the investment required to build the global gas industry displaces investment in renewables.
A key limitation on natural gas usage is the difficulty of transportation, particularly across oceans and over long distances. LNG is natural gas that has been cooled for purposes of transportation to approximately –163°C (–260°F), changing it from a gas to a liquid 1/600th its original volume. It is shipped in double-hulled seagoing vessels known as LNG carriers designed specifically to handle the low temperature of LNG. There are currently now more than 130 such ocean carriers in operation worldwide. Receiving or gasification terminals take the form of specially constructed ports devoted exclusively to the importing and exporting of LNG. Once it reaches its destination it is stored in insulated tanks built specifically to hold LNG. When there is demand for fuel the LNG is heated to return it to its gaseous state and delivered via pipelines as natural gas to customers. LNG is exported by countries with large natural gas reserves such as Algeria, Australia, Brunei, Indonesia, Libya, Malaysia, Nigeria, Oman, Qatar, and Trinidad and Tobago. There are some sixty LNG receiving terminals worldwide, mainly in high-income consuming nations such as Japan, Korea, the United States, and some European countries.
As the “cleaner” hydrocarbon, natural gas has been promoted as a partial solution to the problem of global warming. As the ecological critique of carbon-based fuel consumption grows louder, with supply concerns prompting energy price increases and OPEC members claiming greater sovereignty over petroleum assets, natural gas appears increasingly attractive both financially and environmentally. Multinationals displace lost oil reserves with gas, while they market themselves as greener energy companies (the most notable being BP’s new moniker: Beyond Petroleum). Daniel Yergin, Pulitzer-winning author of the book The Prize on the oil industry, referred to natural gas as “The Next Prize” in a 2004 article in Foreign Affairs. Making it prize-worthy, however, depends on LNG development that is high-risk, costly, and inefficient.
David Harvey’s theorization of the “spatial fix” provides insight into the formation of the global LNG market, since it is by nature a global industry, associated with overseas transport of fossil fuel. Although technically difficult, LNG development helps the oil and gas industry address some of fossil capitalism’s contradictions while creating others. The investment of surplus in LNG infrastructure allows for the use of excess capital in specific sites. Concurrently, certain social contradictions of the “state-tied” resource curse are avoided, transferring the product out of relatively insecure settings and into more profitable ones. Given rising criticism of the oil and gas industry, however, the promotion and connection of LNG to the North American power grid must be accomplished. So industry aims to persuade legislators and the public that LNG has some intrinsic value in terms of conservation, the environment, and energy security. But providing a convincing argument for LNG could become increasingly difficult with recent assertions that drilling for shale gas in the United States could preclude the need for these imports.
The analysis below examines how the LNG industry is commonly conceived as a partial, stop-gap solution to the ecological and economic crises arising from fossil-fuel dependence. By looking at the overseas transfer of LNG from Nigeria to Mexico in order to power the U.S. energy grid, this article seeks to explain ongoing spatial transfers associated with “ecological imperialism.” Mexico’s first LNG terminal, operational since 2006, is a Shell project in Tamaulipas State, which borders Texas, sourcing gas from its Nigerian LNG facility in Bonny Island. LNG development in the two sites in Nigeria and Mexico has interfaced with varying social conflicts and positions in the global political economy of oil — in the Nigerian case, highly volatile, in the Mexican relatively stable. Fostered by corporate subsidies, the gas ultimately enters the more lucrative U.S. market, servicing that country’s hydrocarbon-accumulation model.3
The Resource Curse
Although the term “resource curse” seems an apt descriptor for the global pitfalls of hydrocarbon dependency, in its original usage it had a decidedly state-centered focus. The curse describes how exporters of high-valued natural resources become tied to a single major source of revenue in a form that stymies their domestic economic growth. Classic examples of this dynamic in the oil sector include Nigeria, and Venezuela up until the late 1990s. Sometimes called the “paradox of plenty,” this condition is associated with the accumulation of high-value natural-resource based capital in a particular state. The rapid accumulation of surplus through exports of this resource erodes social cohesion, encouraging spending on conspicuous consumption and imported goods rather than industrialization. Socially, this leads to magnified inequality as powerful elites claim “rents,” or kickbacks, in a cash-flooded national economy.4
The state socio-economic erosion associated with the “curse” includes deteriorating public services and infrastructure. Often, due to the consumption culture that the curse is said to foster, poor services are attributed to corrupt actors in commercial and governmental institutions. But the deterioration of infrastructure cannot be attributed merely to acquisitive values or—as often implicit in contemporary charges of corruption against developing countries—to “laziness” (a stigma laden with colonizing stereotypes). In fact, the concept of Dutch Disease, often equated with the resource curse, was coined to describe the deterioration of the Netherlands following the gas boom of the 1960s. And a similar curse has been used to explain the centuries-earlier deterioration of the Spanish economy as a result of rampant extraction of silver and natural wealth from the Americas. The rising exchange rate that results from accumulation during a boom period prompts de-industrialization, as manufacturing and agricultural sectors become less competitive on the global market, and even domestically. In various third world oil exporters, this phenomenon has encouraged divestment from these sectors, leading to “underdevelopment.”
Interestingly, those oil producers commonly identified as having “escaped the curse” include Mexico, where oil came under national control after the expropriation of foreign oil holdings in 1938.5 Mexican petroleum production after the expropriation was initially intended to be directed toward national industrial development in accordance with an import substitution model, although this was later to break down as a result of U.S. economic dominance, creeping privatization, and neoliberalism.
In contrast to the explicitly developmentalist and import-substitution model that prevailed in Mexico, advancing de-industrialization, associated with high-value resource extraction and the related export dependency, makes most resource-cursed countries less attractive sites for reinvestment of the energy and capital surplus extracted.6 In Nigeria, despite considerable need for domestic gas as a cooking fuel, gas associated with the oil extraction is primarily being liquefied for export. The transformation of Nigerian gas into LNG makes it a globally tradable substance—serving European and North American markets far afield. Contemporary military advances into West Africa through the expansion of the U.S. Africa Command, and the UK’s recent offering of policing support to assuage the Niger Delta crisis, echo the imperial histories of these regions. Indeed, historical and contemporary extraction of natural resources from these regions and the socio-political strategies that facilitate it may well be explained as ecological imperialism.7
Harnessing Gas
The construction of a global gas market, complete with dedicated LNG terminals, requires that legislators and a public wary of energy companies must first be convinced of its economic and environmental benefits. Moreover, particular technology must be put into place to move it trans-oceanically. As described by Gavin Bridge, the properties of gas as an ethereal substance shape a “stubbornly anachronistic geography of commodity supply.” Where terrestrial pipelines cannot be installed, overseas shipment demands liquefaction at extremely cold temperatures, allowing its transport on special tankers to distant terminals. Once it arrives at its destination, the substance is regasified and linked into domestic power grids.
Whether piped or shipped, this is an expensive undertaking and, until the recent upsurge in energy prices, much gas was considered “stranded” since the process was considered too costly to be viable.8 Today the context has changed, with concerns regarding a global fuel shortage prompting rising prices on gas futures markets that are beneficial for the promotion of LNG development. In the last ten years the international oil industry has placed a major emphasis on the development of LNG terminals and infrastructural connections in North America. Although there is widespread consensus that natural gas is preferable to coal burning for electricity generation, LNG is a doubtful candidate for an overall reduction in carbon emissions. Recent studies suggest that the carbon footprint of LNG transported long distances may be substantial.9 Building a North American domestic LNG infrastructure will also shape a set of commercial and worker interests tied to this industry, which may further postpone and/or create obstacles to non-hydrocarbon sources as a substitute.
Although LNG currently accounts for only about 30 percent of the inter-regional trade in gas, the International Energy Agency estimates that the figure may rise to 50 percent by 2030. National oil companies play a large role in gas liquefaction, with Indonesian and Brazilian parastatals among the most important. But Shell also figures in the top three for liquefaction capacity, and private energy companies primarily run LNG receiving terminals.10
LNG in Nigeria and Mexico and Capital’s Spatial Fix
The Nigerian LNG project at Bonny Island—a joint venture between the Nigerian National Petroleum Company, Shell, ENI (Agip) Italy, and Total—was first proposed in 1989, and became operational a decade later. The liquefaction and export of natural gas is the Nigerian oil industry’s external solution to the problem of flaring in the Niger Delta—where 70–80 percent of gas extracted alongside petroleum (known as associated gas) is burned, the highest rate in the world—leading to acid rain and erosion that effects fishing and local wildlife. Huge surface flares light up the night sky. Since the Ogoni mobilization and Ken Saro-Wiwa’s execution in the 1990s, these flares have become symbolic of the impunity with which environmental and human rights norms are disregarded by the global oil industry in Nigeria.11 Flaring occurs at a rate of at least 2.5 billion cubic feet per day with many riverine villages “never knowing a dark night.”12 Shell Nigeria is the largest single flarer.
Unsurprisingly, after fifty years of ongoing flaring, this industrial form of waste elimination is an indelible part of the region’s socio-ecology. Condemned by the Ogoni, Ijaw, and other Nigerian “oil minorities” as a violation of indigenous rights, flaring in the Delta is seen as a clear manifestation of environmental racism, or “global apartheid,” as applied to the exploitation of natural resources. In protest against oil extraction in the Delta in 1999, Ijaw youth initiated “Operation Climate Change” whose aim was to “extinguish the flares.” In the context of a history of harsh repression of protests and blockades, and the increased presence of militia groups acting as both security and threat to the oil industry, resistance in the Delta has been radicalized. In the last two years media reports on precarious oil supplies include references to the violent Deltan “crisis.”13
In addition to the release of toxic chemicals into the atmosphere, attention to global climate change makes flaring practices in the Delta a further target of criticism: The World Bank estimates that, due to flaring, Nigeria had contributed more greenhouse gases to the atmosphere than all other Sub-Saharan African countries combined by 2002. Environmental advocates inside and outside Nigeria have condemned the possibility of using flaring elimination to gain carbon credits (i.e., World Bank Clean Development Mechanism financing) under Kyoto, employing a recent Nigerian High Court ruling defining flaring as a violation of human/environmental rights and illegal on that basis.
The actual site of the LNG plant, Bonny Island, was a key port for the Trans-Atlantic slave trade—the lasting impact of which some theorists believe helps explain the salience of tribal divisions in the contemporary Nigerian state.14 On Bonny Island itself, an ecologically protected area at Finima was established as a requirement of the Nigerian LNG Environmental Impact Assessment. This protected area is administered by a Nigerian environmental NGO.15 The Nigerian LNG project and the public affairs programs it has advanced are today deployed as industry-community models, departing from divisive “host-community” policies which stoked inter-communal violence, and promoting improved social and environmental performance.
However, the harsh reality is that competitive violence over oil industry access payments and “piracy” (or contraband oil trade) in the Bonny region has continued, including kidnappings of Nigerian and expatriate oil workers. The marketing of the product elsewhere allows it to escape a region marked as too risky for domestic infrastructural investment. Concurrently the transfer of LNG allows capital an opportunity to engage in a kind of “spatial fix,” overcoming an over-exploited “socio-nature”/resource base, and a regime of overaccumulation of capital through the sale of LNG abroad.
The shipment overseas of LNG from Nigeria to Mexico allows the oil industry to benefit from the latter’s stability as well as its proximity to the largest domestic market in the world. Shell’s Altamira terminal in Tamaulipas State, of which it holds 50 percent—with Total and Mitsubishi holding another 25 percent each—is Mexico’s first regasification plant, operational prior to the Sempra/Shell terminal at Costa Azul. The port at Tampico, just South of Altamira, is a historical pivot in Mexican oil extraction. The broader Huasteca region of which it forms a part became famous for its “gushers” and was at once a “huge source of wealth and environmental destruction.” Its workers were central to the push for the 1938 expropriation of the former Shell and Standard Oil subsidiary companies—El Aguila and Huasteca.
Building on article 27 of Mexico’s revolutionary 1917 constitution, the 1938 oil expropriation put into practice the national exploitation of sub-soil resources. Through worker mobilization, and spurring major conflicts with the U.S. and UK governments, this expropriation was finally accepted, as it served U.S. financial interests. It provided Mexico the collateral to take out loans for industrial and infrastructural development. Not only did the expropriation express labor control over the means of production but, as Myrna Santiago demonstrates, it gave rise to an important conservationist sensibility—aiming to protect the resource for use by future generations of Mexicans.16
The Mexican expropriation marked a global turning point, the first case of a Southern oil exporter expelling multinational oil companies from its territory, over three decades prior to the creation of OPEC. But where OPEC would seek to control global prices of the commodity, Mexico’s expropriation expressed what would become a key tenet of Latin American import-substitution industrialization, the use of primary resources for national development rather than foreign exchange.
As LNG terminals are a prime strategic investment for foreign industry, they are also a target for contemporary protests against the denationalization of the Mexican oil industry. Since the Salinas de Gortari presidency, portions of the Mexican national oil company have been decentralized and in some cases privatized. These shifts occurred in a general economic climate that committed Mexican energy sources to rapid development, a condition of the U.S. financial bailout to the country following the 1994 peso crash that trailed the implementation of NAFTA and the Zapatista uprising. The marketization of LNG as “non-extractive” is in fact an important arena in the current debate concerning the creeping denationalization and privatization of the Mexican oil and gas sector—which has deepened in the aftermath of the highly contentious 2006 presidential elections taken by the conservative PAN in dubious circumstances. The Mexican Constitution continues to prohibit foreign or private firms from extraction and production of energy although not marketing. Thus the legality of LNG projects in Mexico has been challenged by various national groups, including coalitions of professional staff and democratic workers associations of the Mexican national oil company (Pemex), as a threat to energy sovereignty.17
The movement of LNG from Nigeria to a terminal in Mexico provides us with a window on the socio-ecological crises of hydrocarbon consumption and the industry’s contradictory attempt to resolve these crises. In Nigeria, industry and government frames LNG as a solution to social and ecological ills more easily than in the North American context. The infrastructural and social marginalization of the Delta region and the country as a whole makes its domestic energy sector unappealing for investors—despite a considerably underserved domestic market in natural gas. The violence that has become an indelible part of the Nigerian operating environment, attributable in part to the community affairs practices of the oil industry, is avoided while the outcry associated with the flaring of the region’s gas is discursively countered. Shipping the gas out of Nigeria and into Mexico is clearly a more lucrative option for an industry that purports to address the curse associated with hydrocarbon dependency nationally and globally.
LNG and its Discontents
Yet, the shifting of LNG to terminals in North America, where it will be available for the North American market and distributed under relatively stable conditions, has run into opposition. Over the last two years, a series of proposed LNG terminals in California and Baja California have been defeated due to sustained citizen protest—not a single terminal has been approved in California. Recently LNG terminals have been cancelled near Long Island, New York, in Oxnard, California, and near Ensenada, Baja California, and deferred in Canada. Active opposition to proposed terminals in Maine has spurred a regional coalition that includes the Canadian province of New Brunswick.18In 2008, the Clintons and Barack Obama acknowledged popular campaigns against planned LNG terminals in Oregon.19 Public opposition to the terminals has revolved around negative environmental impacts, the risk of accidents, and the threat of terrorist attacks on them. Mother Jones referred to them as “floating targets” in 2007.20
According to official U.S. sources, ten serious LNG accidents have occurred since the 1940s worldwide but with few fatalities. As such, Congress gave LNG land terminals a relatively safe rating in a 2003 report. In 2005 a Washington state-based public interest group took issue with the U.S. Federal Energy Regulatory Commission’s LNG safety approval. The report for the Pipeline Safety Trust counters that “for a variety of significant reasons, past operating records do not provide an appropriate perspective for the analysis of LNG risks. Overemphasis on past operations to predict future failures is a characteristic of poor risk management techniques, particularly for such complex systems.”21
While proponents of LNG portray it as “methane that is colorless, odorless and non-toxic,” environmental groups marshal contrary data.22 Not only does LNG include additional hydrocarbons like ethane, propane, and other contaminants, the receiving facilities bring together four major risks: high-energy density, huge inventories, unusual release dynamics associated with extreme cold (cryogenic temperatures), and very large impact zones of potential explosions.23 Official U.S. regulatory discourse describes LNG as “non-explosive” in its liquid state, a trait that does not differentiate it from other flammable liquids. But critics point out that LNG varies since it is held at unnaturally cool temperatures. A major LNG spill in Cleveland in 1944 resulted in a fire that killed 128 people. In its opposition to projects in Baja California, Greenpeace Mexico cited accidents at Staten Island in 1975 with a death toll of 45; a gas cloud in Boston in 1988, and an accident in Algeria—the second largest exporter of LNG globally—that killed 23.
Alongside socio-environmental risks, the West Coast coalition under the Ratepayers for Affordable Clean Energy (RACE) banner highlights how LNG projects largely serve to guarantee profits for crony energy companies. A former member of the California Public Utilities Commission called LNG development the “single largest change in the state’s energy infrastructure” since the 1950s.24 Were these projects to proceed, capital investment would tie the West Coast to gas rather than renewables, under the thumb of an energy sector already tarnished by price and supply manipulation during California’s 2000–01 energy crisis. Crucially, the role of the state regulators in pushing through LNG at the behest of key industry actors is openly condemned by the RACE coalition. They point to a California Public Utilities Commission ruling allowing utilities “the right to not renew contracts for domestic natural gas so these utilities can enter into LNG supply contracts, in essence favoring LNG from abroad over supplies from the Western United States and Canada.”25 The correct policy choice, argues RACE, is the continued usage of domestic gas sources that are more easily monitored for environmental impacts, less costly, and less hazardous than LNG receiving terminals. Concurrently, the demand for natural gas should be reduced via implementation of California’s clean energy laws and policies.
Though proposed LNG sources vary, many are typical extractive areas: economically and spatially isolated locations, communities socio-historically marginalized in racial/cultural and class terms, which may be ecologically rich but in which environmental regulations are relatively weak or minimally enforced. Among the early ecologically controversial LNG projects was a Royal Dutch Shell project on Russia’s Sakhalin Island marked as a threat to the Western Gray Whale. The Sakhalin II project prompted opposition in California from the organization Pacific Environment, which eventually spearheaded the establishment of the RACE coalition.
In the case of North American LNG, marginality is similarly desirable for terminal sites, especially in the midst of the “terror-target” hype. Accordingly, this makes Mexico a relatively attractive terminal site. In addition to lower labor and construction costs, certain industrial practices are tolerated that would be prohibited on the other side of the border. For instance, in Mexico LNG terminals may employ sea-water to warm the gas to normal temperature. Greenpeace Mexico’s campaign against LNG terminals, launched in 2004, employed a discourse of resource sovereignty as well as ecology, merging environmental movements with nationalist branches of the energy sector.26
To date, on the West Coast, only one LNG terminal has proceeded in the state of Baja California but not without a struggle. This is the Sempra facility that became functional in April 2008. Initiated by Shell Mexico, the company began to distance itself from the project in 2005, following opposition from a coalition that included both a Tijuana housewives association and a San Diego surfer’s club.27 Sempra then took it over, with Shell purchasing 50 percent of Sempra’s interests, but Shell’s name is not publicly associated with the terminal.28 Another proposed LNG terminal nearby in Puerto Libertad, Sonora has received support from the Sonora state government. According to the U.S. Department of Energy the latter has signed an agreement for a pipeline system to distribute the gas in both Mexico and the United States.
In Baja California, as in California, opposition to terminals is buttressed by the relatively advantaged sectors that oppose its development. On both sides of this border, these include tourism and real estate as well as the environmental movement which holds historical weight on the U.S. West Coast. In Baja California press attention was successfully harnessed, and a major Mexican television network produced a twenty-minute documentary critical of the LNG projects complete with ominous music. Following protest by a cross-border group of ecologists, NGOs, and fishing cooperatives, a proposed Chevron LNG terminal at the Islas Coronados, Baja California was cancelled in April 2007. The islands provide a habitat for a vulnerable marine bird, the Xantus, on which basis a case was taken to NAFTA’s Committee on Environmental Cooperation in 2005.29
California and Baja California resistance differs quite markedly from that on the Gulf Coast. Nine of the ten existing North American LNG terminals are located in the Gulf region and the northeast. Five are sited in Texas and Louisiana, one in Georgia, and two in New England. Louisiana and Texas share a long history of petroleum industry presence reflected in the relative amenability of those sites to receiving terminals.30 Of the ten, two are Mexican terminals: the aforementioned Sempra Costa Azul terminal between Ensenada and Tijuana and the one at Altamira, Tamaulipas. Tamaulipas shares the U.S. Gulf Coast’s long oil industry history, and its Huasteca region saw severe environmental degradation through the first half of the twentieth century.31 Over time the presence of the oil industry and a powerful national petroleum workers’ union has tied generations of Mexico’s Gulf State inhabitants to hydrocarbon production.
The Shell Tamaulipas LNG was initially to be supplied by Venezuela. But this project was cancelled in 2005, as Venezuela’s PDVSA (oil parastatal) took an increasingly sovereigntist stance regarding extraction, and removed both Shell and Mistubishi from its Mariscal-Sucre LNG project. It was under these circumstances that Shell Mexico moved to supply the plant from further afield—the Nigerian LNG project. The Nigerian-Mexican LNG relationship under the aegis of U.S. capital is thus partly a response of North American capitalism to limits imposed by Venezuelan resistance to foreign capital and embrace of regional energy sovereignty.
In the face of such resource sovereignty movements in the Global South, the movement of LNG from Nigeria to a terminal in Mexico—for U.S. consumption—is an example of the industry’s attempt to resolve the crises associated with on-going hydrocarbon extraction. It also manifests the ongoing transfer of “natural capital” that has been central to the development of global capitalism.32 In Mexico, LNG terminals face weaker environmental regulations and a (somewhat) less oppositional public than in the United States toward which the gas is ultimately destined. Yet the privatized nature of LNG development in Mexico is hotly debated, and figures prominently in struggles over the future of the Mexican energy sector and the national economy. As a global “band-aid” for fossil capitalism, the costs and complications associated with LNG thus attract increasing public scrutiny and critique.
Notes
Elmar Altvater, “The Social and Natural Environment of Fossil Capitalism,” in Leo Panitch and Colin Leys, ed., Socialist Register 2007 (New York: Monthly Review Press, 2006).
See http://www.LNGpollutes.org.
John Bellamy Foster and Brett Clark, “Ecological Imperialism: The Curse of Capitalism,” in Leo Panitch and Colin Leys, ed., Socialist Register 2004 (New York: Monthly Review Press, 2003), 186–201. David Harvey, The New Imperialism (New York: Oxford University Press, 2003), and Spaces of Hope (Berkeley: University of Califonria Press, 2000). Lorenzo Meyer, Mexico and the United States in the Oil Controversy 1917–42 (Austin: University of Texas Press, 1972).
Texts include Richard Auty, Sustaining Development in Mineral Economies (London: Routledge, 1993); Terry Lynn Karl, The Paradox of Plenty (Berkeley: University of California Press, 1997); and M. Ross, “Does Oil Hinder Democracy?” World Politics 53, no. 3 (2001): 325–61. See M. Watts, “Resource curse?” Geopolitics 9, 1 (50–80) for critique of some conventional approaches to the oil-conflict nexus and K. Omeje, ed., Extractive Economies and Conflicts in the Global South (Aldershot, Ashgate, 2008).
See for instance Lorenzo Meyer and Isidro Morales, Petróleo y nación (Mexico D.F.: Colegio de Mexico, 1990).
A problem that became more pronounced in the period following the debt crisis, a crisis that in fact resulted from the need for Northern banks to recycle the petro-dollars which Southern oil exporters deposited there during the oil shocks of the 1970s.
Foster and Clark, “Ecological Imperialism”; Jason W. Moore, “Environmental Crises and the Metabolic Rift in World-Historical Perspective,” Organization & Environment 13, no. 2 (2000): 123–57.
Gavin Bridge, “Gas, and How to Get It,” Geoforum 35 (2005): 395–97.
See Paulina Jaramillo, W. M. Griffin, and H. S. Matthews “Comparative Life-Cycle Air Emissions of Coal, Domestic Natural Gas, LNG, and SNG for Electricity Generation.” Environmental Science and Technology 41, no. 17 (2007): 6290–96.
Faith Birol, “LNG in the World Energy Outlook,” International Energy Agency Presentation to “Making Gas Market Global Workshop,” Paris, 2005.
See Ike Okonta, When Citizens Revolt (Trenton: Africa World Press, 2008); Don Pedro, Ibiba, Oil in the Water (Lagos, Foreword Communications,2006); Cyril Obi, The Changing Forms of Iden Nordiska Afrikainstitutet, Uppsala, 2001).
For detailed statistics see Environmental Rights Action Nigeria, (Friends of the Earth), Gas Flaring in Nigeria, 2005.
Ukoha Ukiwo, “From ‘pirates’ to ‘militants,’” African Affairs 2007 106, no. 425: 587–610; Peterside and Zalik “The Commodification of Violence in the Niger Delta” in Leo Panitch and Colin Leys, eds., Socialist Register 2009. (New York: Monthly Review Press, 2008).
Peter P. Ekeh, “Colonialism and the Two Publics in Africa,” Comparative Studies in Society and History 17 (1975): 91–112.
At Finima, the administering NGO often finds discarded pipes and other industrial waste on the protected site (author’s fieldwork 2003, 2006).
For further details on ecological destruction in this period see Myrna Santiago, The Ecology of Oil (Cambridge: Cambridge University Press, 2006), 133.
See http://UNTCIP.net.
See Tyler Hamilton, “Is LNG Flame Burning Out?” Toronto Star, April 12, 2008. Also See http://www.savepassamaquoddybay.org.
See The Daily Astorian, May 13, 2008. On visiting Astoria, Bill Clinton referred to Hilary’s opposition to the 2005 Energy Policy Act that placed approbatory power for LNG terminals with the Federal Energy Regulatory Commission. This is partially contested, see http://www.energycurrent.com/?id=3&storyid=9628.
James Ridgeway, “Homeland Security: Floating Targets,” Sept. 6, 2007.
Richard Kuprewicz, et al., Public Safety and FERC’s LNG (Bellingham, WA: Pipeline Safety Trust, 2005). The Pipeline Safety Trust was formed in 1999 following the Olympic Pipeline explosion near Bellingham.
http://www.ferc.gov/o12faqpro/default.asp?Action=Q&ID=464.
Kuprewicz, et al., Public Safety and FERC’s LNG. Various forms of LNG hazards are identified in the report—pool fires, flammable vapor clouds, and flameless explosions. In the case of pool fires the ignition of evaporating gas would lead to an increase in the “pool size” as LNG expanded away from its source. Due to inability to extinguish such a fire prior to the consumption of all the LNG at source, thermal radiation could injure people and property at considerable distance. If a similar spill does not ignite, it could drift some distance away where it might encounter a source of ignition and burn at varying degrees in various parts—dependent on concentration.
Loretta Lynch, formerly California Public Utilities Commissioner, http://pacificenvironment.org/article.php?id=2074.
The California Public Utilities Commission denied the RACE coalition’s demand for public hearings on LNG in the state. See Rory Cox and Robert Freehling, “Collision Course,” 24.
Greenpeace Mexico, Press Release, May 29, 2004. “To accept the Transnationals Liquefied Natural Gas project implies energy dependence, high risks and that we accept being the United States backyard.”
See http://www.surfrider.org.
See U.S. Energy Information Administration/Department of Energy, Mexico Country Analysis Brief, January 2007.
In a 2004 briefing on Mexican Gas projects, a business source highlighted Mexican Congressional opposition to the Chevron Islas Coronado project, twenty miles off the coast “under the argument that foreign multinational companies will end up having control of Mexican sovereign waters.” Haynes and Boone LLP, “Mexico’s Gas Markets.” Available at http://www.hg.org/articles/article_410.html.
William Freudenburg and Robert Gramling, Oil in Troubled Waters (Albany: SUNY, 2004).
On this point see Santiago, The Ecology of Oil.
Jason W. Moore, “Environmental Crises and the Metabolic Rift in World-Historical Perspective,” Organization & Environment 13, no. 2 (2000): 123–57; John Bellamy Foster, “Marx’s Theory of Metabolic Rift: Classical Foundations for Environmental Sociology,” American Journal of Sociology 2 (1999): 366–405.
TIME Engineering Participates In Gerak Usahawan Programme In Egypt
TIME Engineering Participates In Gerak Usahawan Programme In EgyptBy Lat Zaharah Abd MutalibCAIRO, Dec 1 (Bernama) -- Time Engineering Bhd (TIME), a leading player in the information, communications and technology (ICT) sector, is participating in the Gerak Usahawan programme organised by the Ministry of Entrepreneur and Cooperative Development here.The programme, in collaboration with the Ministry of Higher Education, is meant to increase awareness and instil an interest in entrepreneurship among Malaysian students abroad.It is also meant to create a platform for them to embark on entrepreneurship upon graduation.The Deputy Minister of Entrepreneur and Cooperative Development Datuk Saiffuddin Abdullah launched the programme here today, with Egypt chosen as the first country for it.TIME, a government linked company(GLC) is participating as well as sponsoring, the Gerak Usahawan programme."We would like to thank the Ministry for giving us an opportunity to support the Gerak Usahawan programme."Our participation in it is also very much in line with our Corporate Social Responsibility(CSR) initiative, with education and human capital development as its core theme," said TIME managing director Amiruddin Abdul Aziz in a statement here Monday.He said developing a sizeable pool of local entrepreneurs was important as the country would benefit from this.Entrepreneurs, known for their resourcefulness and creativity, can help develop new markets as well as introduce new ways of doing business, which in turn generates more opportunities and spurs productivity for the country, he said."As most tend to be innovators and reasonable risk-takers,entrepreneurs seem to be more responsive to taking advantage of business opportunities while introducing new and exciting products and services that contribute significantly to the development of the country's economy," he added.In addition, entrepreneurship also helps create employment opportunities, not only for entrepreneurs, but others as well, Amiruddin added.He said under the Bumiputera Vendor Development Programme, TIME supplied multimedia teaching equipment in the Teaching and Learning of Science and Mathematics in English (PPSMI) project, by the Ministry of Education."TIME has designed its Bumiputera Vendor Development Programme to help develop Bumiputera companies and entrepreneurs by engaging and partnering with them in various business opportunities," said Amiruddin.He said TIME had developed 33 companies as training contractors and 127 system installers, including 39 companies as authorised service providers, while training more than 250 qualified technicians to support and maintain equipment for the project."TIME's pool of system installers are provided with relevant assistance including ICT skills training conducted and certified by multinational companies such as HP, Dell, Acer, NEC, Lenova and Samsung, whose products are being supplied and maintained under the PPSMI."TIME through the partnership with these multinational companies, conducts training for local technical professionals from these system installers companies to become certified authorised technicians," he highlighted.According to Amiruddin,in addition to ICT skills training, these companies are also given coaching and mentoring and at times, even financial assistance, to help them effectively manage their businesses and prepare them to stand and compete on their own.TIME has also trained and certified in collaboration with Microsoft, more than 800 trainers, comprising about 95 percent Bumiputeras, to provide ICT training for teachers, he said.-- BERNAMA
FOR MISC Bhd, the world's single largest owner-operator of liquefied natural gas (LNG) tankers, the concept of corporate responsibility (CR) goes beyo
FOR MISC Bhd, the world's single largest owner-operator of liquefied natural gas (LNG) tankers, the concept of corporate responsibility (CR) goes beyond philanthropy and public relations.
The shipping giant's CR programmes propel quantitative and qualitative long-term growth that benefits the group, shareholders as well as stakeholders.
Its CR programmes also support Malaysia's bid to become a prominent maritime nation.
Dealing with the complex and advanced LNG and other types of energy transportation, MISC has long anticipated the present shortage of skilled seafarers.
It has been working on and investing in various educational and training programmes for youths.
It is speculated the global shortfall in shipping manpower has doubled to 20,000 in the last two years.
Group corporate affairs general manager Fiona Clare Pereira told StarBiz that MISC CR-related programmes continued to focus on youth development this year.
“As Malaysia is envisioned to be a maritime nation, MISC is committed towards the provision of efficient human capital to support this vision, focusing on our very own Malaysian Maritime Academy (Alam).
“For the financial year ended March 2007, more than RM16mil was invested in our cadet sponsorship programme at Alam,” she said.
Today, she added that many of the sea captains in Malaysia's maritime-related industries were Alam graduates and MISC was proud to be the contributing factor behind their success.
“And many more graduates of calibre are already in the making.she said.
“Although they may not be on life-long employment with MISC, our CR towards fulfilling Malaysia's aspirations of becoming a maritime nation will always be at the forefront of our commitment,” she said, adding that this also ensured the availability of seafarers for MISC's growing fleet.
According to Pereira, its latest CR programme, “Navigate Your Career” is an effort to prepare university students to enter the real “working world”.
“MISC wishes to prepare them to be more adaptive to the changes and progression of the job market,” she said, adding that the programme was launched last July in various universities across the nation.
She said the three-part programme, “Educate, Engage & Expose - Navigate Your Career”, was geared towards enhancing employment awareness via guidance initiatives imparting soft skills and insights into career development.
This CR programme is inclusive of road shows, an online resource centre and practical attachment.
About 3,000 undergraduates participated in this programme whilst eight students have just completed the student attachment pilot project.
“We believe our latest effort in social development will help create a more buoyant local graduate pool in the near future,” Pereira said.
Also last February, MISC and Universiti Teknologi Malaysia (UiTM) signed a memorandum of agreement (MoA) for the establishment of Professorship Chair in marine technology at UiTM.
The chair is tasked with bridging the gap between what the academic institution is offering and the maritime industry’s needs for qualified personnel and technological advancement to meet the present and future challenges.
The establishment of the chair would further enhance research in maritime technology, which would benefit the maritime sector in Malaysia.
MISC and UiTM have also jointly established a Marine Technology Research and Development Database at UiTM.
The database focuses on marine technology research and development data throughout Malaysia.
In terms of health and safety in the workplace, MISC does not confine itself to a specific programme or scheme.
Its corporate health, safety and environment general manager Captain M.K. Ganesan said several programmes usually ran all year round.
“Promoting healthy lifestyle, safety and protecting the environment are some of the programmes that have been rolled out,” Capt Ganesan said.
“Onboard our vessels, we have an ongoing campaign - Zero Incident Zero Accident (ZIZA) - for our officers and crew to be vigilant at all times,” he added.
In the last financial year, 13 ships recorded their third year ZIZA safety performance; seven ships, their second year; and 13 ships passed their first year.
Capt Ganesan said another significant project launched in 2006 was the MISC fuel efficiency campaign.
“The fuel saving measures not only reduce consumption but also environmental pollution.
“Burning one or two extra tonnes of fuel oil on a voyage can have much effect on the overall fuel cost and environmental pollution.
“The cost becomes substantial when this is extrapolated within MISC's entire fleet,” he said.
To MISC, CR is not only about making a positive impact on society and the environment but also generating sustainable benefits to society as part of maintai ning a long-term competitive business.
The shipping giant's CR programmes propel quantitative and qualitative long-term growth that benefits the group, shareholders as well as stakeholders.
Its CR programmes also support Malaysia's bid to become a prominent maritime nation.
Dealing with the complex and advanced LNG and other types of energy transportation, MISC has long anticipated the present shortage of skilled seafarers.
It has been working on and investing in various educational and training programmes for youths.
It is speculated the global shortfall in shipping manpower has doubled to 20,000 in the last two years.
Group corporate affairs general manager Fiona Clare Pereira told StarBiz that MISC CR-related programmes continued to focus on youth development this year.
“As Malaysia is envisioned to be a maritime nation, MISC is committed towards the provision of efficient human capital to support this vision, focusing on our very own Malaysian Maritime Academy (Alam).
“For the financial year ended March 2007, more than RM16mil was invested in our cadet sponsorship programme at Alam,” she said.
Today, she added that many of the sea captains in Malaysia's maritime-related industries were Alam graduates and MISC was proud to be the contributing factor behind their success.
“And many more graduates of calibre are already in the making.she said.
“Although they may not be on life-long employment with MISC, our CR towards fulfilling Malaysia's aspirations of becoming a maritime nation will always be at the forefront of our commitment,” she said, adding that this also ensured the availability of seafarers for MISC's growing fleet.
According to Pereira, its latest CR programme, “Navigate Your Career” is an effort to prepare university students to enter the real “working world”.
“MISC wishes to prepare them to be more adaptive to the changes and progression of the job market,” she said, adding that the programme was launched last July in various universities across the nation.
She said the three-part programme, “Educate, Engage & Expose - Navigate Your Career”, was geared towards enhancing employment awareness via guidance initiatives imparting soft skills and insights into career development.
This CR programme is inclusive of road shows, an online resource centre and practical attachment.
About 3,000 undergraduates participated in this programme whilst eight students have just completed the student attachment pilot project.
“We believe our latest effort in social development will help create a more buoyant local graduate pool in the near future,” Pereira said.
Also last February, MISC and Universiti Teknologi Malaysia (UiTM) signed a memorandum of agreement (MoA) for the establishment of Professorship Chair in marine technology at UiTM.
The chair is tasked with bridging the gap between what the academic institution is offering and the maritime industry’s needs for qualified personnel and technological advancement to meet the present and future challenges.
The establishment of the chair would further enhance research in maritime technology, which would benefit the maritime sector in Malaysia.
MISC and UiTM have also jointly established a Marine Technology Research and Development Database at UiTM.
The database focuses on marine technology research and development data throughout Malaysia.
In terms of health and safety in the workplace, MISC does not confine itself to a specific programme or scheme.
Its corporate health, safety and environment general manager Captain M.K. Ganesan said several programmes usually ran all year round.
“Promoting healthy lifestyle, safety and protecting the environment are some of the programmes that have been rolled out,” Capt Ganesan said.
“Onboard our vessels, we have an ongoing campaign - Zero Incident Zero Accident (ZIZA) - for our officers and crew to be vigilant at all times,” he added.
In the last financial year, 13 ships recorded their third year ZIZA safety performance; seven ships, their second year; and 13 ships passed their first year.
Capt Ganesan said another significant project launched in 2006 was the MISC fuel efficiency campaign.
“The fuel saving measures not only reduce consumption but also environmental pollution.
“Burning one or two extra tonnes of fuel oil on a voyage can have much effect on the overall fuel cost and environmental pollution.
“The cost becomes substantial when this is extrapolated within MISC's entire fleet,” he said.
To MISC, CR is not only about making a positive impact on society and the environment but also generating sustainable benefits to society as part of maintai ning a long-term competitive business.
Execution: The Discipline of Getting Things Done
Execution: The Discipline of Getting Things Done
by Larry Bossidy (Author), Ram Charan (Author), Charles Burck (Author) "LARRY: My job at Honeywell International these days is to restore the discipline of execution to a company that had lost it..."
Disciplines like strategy, leadership development, and innovation are the sexier aspects of being at the helm of a successful business; actually getting things done never seems quite as glamorous. But as Larry Bossidy and Ram Charan demonstrate in Execution, the ultimate difference between a company and its competitor is, in fact, the ability to execute.
Execution is "the missing link between aspirations and results," and as such, making it happen is the business leader's most important job. While failure in today's business environment is often attributed to other causes, Bossidy and Charan argue that the biggest obstacle to success is the absence of execution. They point out that without execution, breakthrough thinking on managing change breaks down, and they emphasize the fact that execution is a discipline to learn, not merely the tactical side of business. Supporting this with stories of the "execution difference" being won (EDS) and lost (Xerox and Lucent), the authors describe the building blocks--leaders with the right behaviors, a culture that rewards execution, and a reliable system for having the right people in the right jobs--that need to be in place to manage the three core business processes of people, strategy, and operations. Both Bossidy, CEO of Honeywell International, Inc., and Charan, advisor to corporate executives and author of such books as What the CEO Wants You to Know and Boards That Work, present experience-tested insight into how the smooth linking of these three processes can differentiate one company from the rest. Developing the discipline of execution isn't made out to be simple, nor is this book a quick, easy read. Bossidy and Charan do, however, offer good advice on a neglected topic, making Execution a smart business leader's guide to enacting success rather than permitting demise. --S. Ketchum From Library JournalBossidy, an award-winning executive at General Electric and Allied Signal, came out of retirement to tend to Honeywell (and bring it back to prominence) after it failed to merge with General Electric. Charan has taught at Harvard and Kellogg Business Schools. Collaborating with editor and writer Burck, they present the viewpoint that execution (that is, linking a company's people, strategy, and operations) is what will determine success in today's business world. Bossidy and Charan aver that execution is a discipline integral to strategy, that it is the major job of any business leader hoping not just to be a success but to dominate a market, and that it is a core element of corporate culture. Details of both successful and unsuccessful executions at corporations such as Dell, Johnson & Johnson, and Xerox, to name a few, support not only their how-to method for bringing execution to the forefront but also the need for it. Each author addresses specific topics in paragraphs that begin with either "Larry" or "Ram," and this easy style adds to the appeal of a very readable book. Recommended for academic and public libraries.Steven J. Mayover, PhiladelphiaCopyright 2002 Reed Business Information, Inc.
Larry Bossidy is clearly a five-star leader, and Ram Charan is a gifted consultant and teacher. It surprised me that their book didn't work as well as I had hoped.
Execution's title confused me. Hopefully, you won't have that problem. I thought Execution would be all about how to take a strategy and operating plan and implement them well. Instead, Part III makes it clear that Execution is about meeting overall financial objectives through being an effective organization in setting strategies and operating plans to serve customers well while building an organization that can implement the plans for outperforming competitors. Part I, by contrast, makes it sound like Execution is only about implementation, noting that almost all organizations have the same strategies (or can quickly get them from consultants), access the same top talent and can easily acquire and employ competitively effective innovation.
I also thought Execution would apply to all business people. Instead, the context for most of the AlliedSignal (Honeywell International's name when Mr. Bossidy became CEO there the first time) and General Electric examples which dominate the book is that of the CEO or group executive to whom divisions report in a large conglomerate. In this sense, Execution is like reading the latter chapters of Mr. Welch's book, Jack.
The main difference between Jack and Execution is that Execution tries to build a framework for the book's concepts while sharing examples (mostly of failure) from other organizations. Mr. Charan's sections of the book mostly focus on that positioning. Mr. Bossidy mostly tells about his own experiences at AlliedSignal and Honeywell. Mr. Bossidy, of course, worked with Mr. Welch at General Electric for many years. Mr. Bossidy reports that you could take execution for granted at GE, but that it was lacking at AlliedSignal when he arrived. The two coauthors alternate in providing long monologues on the chapter topics and subtopics.
Three aspects of Execution are valuable to almost any business leader: how to hold a strategy review (chapter 8), building an organization (chapter 5) and the "Dear Jane" letter to a new leader (conclusion).
For those who would like to become CEOs and heads of divisions of large, disparate organizations, Mr. Bossidy's many anecdotes from his experiences at Honeywell International about how to do the leader's job will provide a valuable model that can be used repeatedly. In many such organizations, there are no good leadership examples and this book can help fill the gap.
Here's the book's structure:
Part I: Why Execution Is Needed
Chapter 1. The Gap Nobody Knows
Chapter 2. The Execution Difference
Part II: The Building Blocks of Execution
Chapter 3. Building Block One: The Leader's Seven Essential Behaviors
Chapter 4. Building Block Two: Creating the Framework for Cultural Change
Chapter 5. Building Block Three: The Job No Leader Should Delegate -- Having the Right People in the Right Place
Part III: The Three Core Processes of Execution
Chapter 6. The People Process: Making the Link with Strategy and Operations
Chapter 7. The Strategy Process: Making the Link with People and Operations
Chapter 8. How to Conduct a Strategy Review
Chapter 9. The Operations Process: Making the Link with Strategy and People
Conclusion: Letter to a New Leader
Execution addresses these problems. First, many company and division heads have little knowledge about the businesses or the most important functions and processes needed to prosper. Boards, for example, often bring in a brilliant person who has performed as a "role player" elsewhere, and they cannot scale up into the CEO job. When a company has had poor leadership, its processes and organization also become weak and it's hard to get anything done. There are several poignant examples including Richard Thoman at Xerox and Richard McGinn at Lucent Technologies. It's hard to fix that problem. It took years at AlliedSignal and can be quickly lost (which happened in the two years after he retired the first time). That's why Mr. Bossidy had to come back to restore execution (as he means it) at Honeywell International. Lacking these perspectives, the business system is misdirected (see The Fifth Discipline).
Second, many leaders make bad assumptions about their circumstances. Acting on those assumptions makes matters worse.
Third, companies plan to pursue strategies for which they lack the processes and organizations to implement. The strategies need to match the ability to execute.
As a solution, you as leader must:
"--Know your people and your business--Insist on realism--Set clear goals and priorities--Follow through--Reward the doers--Expand people's capabilities--Know yourself."
I was uncomfortable with many of the examples. The unending praise of Dick Brown at EDS didn't seem to make any sense knowing that EDS's stock melted down and he was asked to leave. He was in big trouble when Execution was written, having encouraged his people to grow by taking on large unprofitable new accounts. It seems like he might have been executing the wrong strategy, one that couldn't be executed. Most of the "failure" examples are anonymous which makes them less credible and less compelling. Finally, Dell is heralded for executing very well (which it certainly does). However, in describing how the company has evolved its business model to outperform competitors, Execution fails to notice that its business model innovation has been essential to success. No competitor has this business model. Execution's assumption that everyone can have the same strategy ignores research that shows that business model innovation creates unique strategies and superior execution compared to making the old business model and strategy more efficient.
Unless you are shooting to be CEO of GE or Honeywell International, I suspect that you would do better to read Good to Great for getting ideas related to improving effectiveness.
After you finish this book, ask yourself what one thing you could improve would make the most difference in your organization's performance over the next week, month, quarter, year and three years.
by Larry Bossidy (Author), Ram Charan (Author), Charles Burck (Author) "LARRY: My job at Honeywell International these days is to restore the discipline of execution to a company that had lost it..."
Disciplines like strategy, leadership development, and innovation are the sexier aspects of being at the helm of a successful business; actually getting things done never seems quite as glamorous. But as Larry Bossidy and Ram Charan demonstrate in Execution, the ultimate difference between a company and its competitor is, in fact, the ability to execute.
Execution is "the missing link between aspirations and results," and as such, making it happen is the business leader's most important job. While failure in today's business environment is often attributed to other causes, Bossidy and Charan argue that the biggest obstacle to success is the absence of execution. They point out that without execution, breakthrough thinking on managing change breaks down, and they emphasize the fact that execution is a discipline to learn, not merely the tactical side of business. Supporting this with stories of the "execution difference" being won (EDS) and lost (Xerox and Lucent), the authors describe the building blocks--leaders with the right behaviors, a culture that rewards execution, and a reliable system for having the right people in the right jobs--that need to be in place to manage the three core business processes of people, strategy, and operations. Both Bossidy, CEO of Honeywell International, Inc., and Charan, advisor to corporate executives and author of such books as What the CEO Wants You to Know and Boards That Work, present experience-tested insight into how the smooth linking of these three processes can differentiate one company from the rest. Developing the discipline of execution isn't made out to be simple, nor is this book a quick, easy read. Bossidy and Charan do, however, offer good advice on a neglected topic, making Execution a smart business leader's guide to enacting success rather than permitting demise. --S. Ketchum From Library JournalBossidy, an award-winning executive at General Electric and Allied Signal, came out of retirement to tend to Honeywell (and bring it back to prominence) after it failed to merge with General Electric. Charan has taught at Harvard and Kellogg Business Schools. Collaborating with editor and writer Burck, they present the viewpoint that execution (that is, linking a company's people, strategy, and operations) is what will determine success in today's business world. Bossidy and Charan aver that execution is a discipline integral to strategy, that it is the major job of any business leader hoping not just to be a success but to dominate a market, and that it is a core element of corporate culture. Details of both successful and unsuccessful executions at corporations such as Dell, Johnson & Johnson, and Xerox, to name a few, support not only their how-to method for bringing execution to the forefront but also the need for it. Each author addresses specific topics in paragraphs that begin with either "Larry" or "Ram," and this easy style adds to the appeal of a very readable book. Recommended for academic and public libraries.Steven J. Mayover, PhiladelphiaCopyright 2002 Reed Business Information, Inc.
Larry Bossidy is clearly a five-star leader, and Ram Charan is a gifted consultant and teacher. It surprised me that their book didn't work as well as I had hoped.
Execution's title confused me. Hopefully, you won't have that problem. I thought Execution would be all about how to take a strategy and operating plan and implement them well. Instead, Part III makes it clear that Execution is about meeting overall financial objectives through being an effective organization in setting strategies and operating plans to serve customers well while building an organization that can implement the plans for outperforming competitors. Part I, by contrast, makes it sound like Execution is only about implementation, noting that almost all organizations have the same strategies (or can quickly get them from consultants), access the same top talent and can easily acquire and employ competitively effective innovation.
I also thought Execution would apply to all business people. Instead, the context for most of the AlliedSignal (Honeywell International's name when Mr. Bossidy became CEO there the first time) and General Electric examples which dominate the book is that of the CEO or group executive to whom divisions report in a large conglomerate. In this sense, Execution is like reading the latter chapters of Mr. Welch's book, Jack.
The main difference between Jack and Execution is that Execution tries to build a framework for the book's concepts while sharing examples (mostly of failure) from other organizations. Mr. Charan's sections of the book mostly focus on that positioning. Mr. Bossidy mostly tells about his own experiences at AlliedSignal and Honeywell. Mr. Bossidy, of course, worked with Mr. Welch at General Electric for many years. Mr. Bossidy reports that you could take execution for granted at GE, but that it was lacking at AlliedSignal when he arrived. The two coauthors alternate in providing long monologues on the chapter topics and subtopics.
Three aspects of Execution are valuable to almost any business leader: how to hold a strategy review (chapter 8), building an organization (chapter 5) and the "Dear Jane" letter to a new leader (conclusion).
For those who would like to become CEOs and heads of divisions of large, disparate organizations, Mr. Bossidy's many anecdotes from his experiences at Honeywell International about how to do the leader's job will provide a valuable model that can be used repeatedly. In many such organizations, there are no good leadership examples and this book can help fill the gap.
Here's the book's structure:
Part I: Why Execution Is Needed
Chapter 1. The Gap Nobody Knows
Chapter 2. The Execution Difference
Part II: The Building Blocks of Execution
Chapter 3. Building Block One: The Leader's Seven Essential Behaviors
Chapter 4. Building Block Two: Creating the Framework for Cultural Change
Chapter 5. Building Block Three: The Job No Leader Should Delegate -- Having the Right People in the Right Place
Part III: The Three Core Processes of Execution
Chapter 6. The People Process: Making the Link with Strategy and Operations
Chapter 7. The Strategy Process: Making the Link with People and Operations
Chapter 8. How to Conduct a Strategy Review
Chapter 9. The Operations Process: Making the Link with Strategy and People
Conclusion: Letter to a New Leader
Execution addresses these problems. First, many company and division heads have little knowledge about the businesses or the most important functions and processes needed to prosper. Boards, for example, often bring in a brilliant person who has performed as a "role player" elsewhere, and they cannot scale up into the CEO job. When a company has had poor leadership, its processes and organization also become weak and it's hard to get anything done. There are several poignant examples including Richard Thoman at Xerox and Richard McGinn at Lucent Technologies. It's hard to fix that problem. It took years at AlliedSignal and can be quickly lost (which happened in the two years after he retired the first time). That's why Mr. Bossidy had to come back to restore execution (as he means it) at Honeywell International. Lacking these perspectives, the business system is misdirected (see The Fifth Discipline).
Second, many leaders make bad assumptions about their circumstances. Acting on those assumptions makes matters worse.
Third, companies plan to pursue strategies for which they lack the processes and organizations to implement. The strategies need to match the ability to execute.
As a solution, you as leader must:
"--Know your people and your business--Insist on realism--Set clear goals and priorities--Follow through--Reward the doers--Expand people's capabilities--Know yourself."
I was uncomfortable with many of the examples. The unending praise of Dick Brown at EDS didn't seem to make any sense knowing that EDS's stock melted down and he was asked to leave. He was in big trouble when Execution was written, having encouraged his people to grow by taking on large unprofitable new accounts. It seems like he might have been executing the wrong strategy, one that couldn't be executed. Most of the "failure" examples are anonymous which makes them less credible and less compelling. Finally, Dell is heralded for executing very well (which it certainly does). However, in describing how the company has evolved its business model to outperform competitors, Execution fails to notice that its business model innovation has been essential to success. No competitor has this business model. Execution's assumption that everyone can have the same strategy ignores research that shows that business model innovation creates unique strategies and superior execution compared to making the old business model and strategy more efficient.
Unless you are shooting to be CEO of GE or Honeywell International, I suspect that you would do better to read Good to Great for getting ideas related to improving effectiveness.
After you finish this book, ask yourself what one thing you could improve would make the most difference in your organization's performance over the next week, month, quarter, year and three years.
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