Private Empire: ExxonMobil and American Power (23 page)

By the late 1990s, the resource curse thesis had become conventional wisdom among liberal-leaning development economists and policymakers, including some at the World Bank. As a decision about Exxon’s oil project neared, antipoverty groups with long experience in Africa, such as Oxfam and Catholic Relief Services, argued that the World Bank was moving too hastily. Their researchers agreed in principle that ordinary Chadians deserved the benefits of their oil wealth, but they doubted that the fragile, violent, embryonic half democracy over which Idriss Déby presided could offer the oversight of oil revenues imagined by the bank. These nongovernmental researchers chafed at optimistic assessments published by the bank, which seemed to them to ignore recent events such as Déby’s suppression of the F.A.R.F. “You really have to examine: What is the nature of the state?” said Ian Gary, who monitored the deal at the time for Catholic Relief Services. “You can’t just see what you want to see.”
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The Chad compact also suggested a double standard for Africa. The World Bank and the Clinton administration did not question the right of Saudi Arabia to use its oil revenue to enrich a corrupt royal family. They did not seek to control social spending in the new oil-producing states of Kazakhstan or Azerbaijan, despite the myriad ways those governments failed to serve their people. Why single out Chad? Why single out Africa? “The oil project is frankly the only hope on the horizon for the nearly eight million people of Chad,” argued Donald Norland, a former American ambassador to the country who used some of his retirement years to campaign for the oil project. “It seems particularly unconscionable, therefore, for outsiders surrounded by modern comforts to oppose the project and thereby condemn the people of Chad to a kind of pristine poverty.”
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It seemed Idriss Déby sent a cousin, Tom Erdimi, to Houston, where Erdimi took an office at Exxon’s upstream division and worked as Déby’s liaison to the corporation. Erdimi helped to manage and push Déby’s negotiations with the bank. The president also appointed Ahmat Hassaballah Soubiane as his ambassador to Washington. Soubiane was a political activist who believed the oil project would be good for Chad in the long run, but who doubted his own president’s sincerity. As the negotiations reached a climax, Déby continued to resist the World Bank’s oversight terms. He “talked about a plot against the sovereignty of Chad” and urged his ambassador to fight. Privately, however, Soubiane “felt very strongly” that the bank and its “instruments of control and surveillance” would help protect his country against “Déby’s desire to do whatever he wanted with the oil revenues.” Soubiane worked to bring Déby around to a compromise.
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In the spring of 2000, Soubiane met on a Saturday with James Wolfensohn at the bank’s headquarters, five blocks from the White House. They argued about Déby’s stubbornness. Soubiane promised to push his president harder. He described how Chadians had come to see the international arguments about their country’s oil. Northern nomads in Chad tell a creation story, “the camel and the jackal,” he explained: The camel was created first, followed by the jackal. The jackal then noticed that the camel was a weaker animal and so it followed wherever the camel went, waiting for it to fall down dead. “Chadians remain skeptical and they believe that Chad’s oil has become the camel,” Soubiane said. “The jackal, since the beginning of the world, has been waiting to watch it fall down.”
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Treasury Secretary Lawrence Summers made the Clinton administration’s policy decisions about World Bank projects; he took advice from Timothy Geithner, who then ran Treasury’s international division. After two years of interagency reviews, Geithner and Summers were united in their support for Exxon’s plans. “Clearly, the project has significant risks,” Summers wrote to the U.S. Catholic Conference, a religious group that had questioned the project. “However, the Bank and borrowers have made a serious and credible effort to deal with these inherent risks, to incorporate lessons learned from failures of the past, and to set a higher standard.”
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The World Bank at last approved the deal. Déby’s political party organized a mass gathering in the streets of N’djamena. The president appeared before the crowd and accepted his people’s congratulations. “The city burst into celebration,” Chris Goldthwait wrote home. “It was to a degree organized, but there was genuine feeling in the crowd that gathered at the parade grounds opposite the Presidential Palace. And there was spontaneity in the horn-honking motorists who sped around town. The President walked over . . .…relaxed and clad in a polo shirt for the evening warmth. The most important economic project in the country’s history would go forward.”

At an inauguration ceremony, Déby seated the ExxonMobil delegation in front of the diplomats before the stage; “the Saudi charge, always sensitive to such matters, complained.” But Goldthwait felt that he “couldn’t fault the Chadians this little breach of protocol—they know where their bread is buttered.”

ExxonMobil’s oil deal in Chad signaled the shifting sovereignties of a rising era in which formal governments were losing relative power. A warlord running a teetering state surrendered prerogatives of his office in exchange for the private capital and cutting-edge technology he required to strengthen his reign. A multilateral lending institution brokered the agreement and afterward contracted with the London office of a global bank, Citigroup, to manage and control most of the revenues due to the warlord’s government. Oxfam, Catholic Relief Services, Global Witness, and other worldwide antipoverty campaigners organized conferences at which they taught Chadian civil society activists how to secure their rights. ExxonMobil, having conceived and financed the oil project in the first instance, and having achieved its business aims after more than two decades of effort, now moved to produce oil on a schedule of its choosing and under contract terms that enshrined its rights ahead of those of the Chadian government.

The United States embassy in N’djamena transmitted a “Sensitive” cable to Washington that candidly described its position in relation to ExxonMobil, when the embassy sought to advance American policies on human rights:

Exxon has been an operator in Chad for almost 30 years now and is self-sufficient working in this environment. To date they have not come to us for advice on how to confront particular human rights situations or how to advance specific political agendas. . . . It is our impression that on a number of fronts, they would probably prefer to keep a certain distance from the embassy. . . . Our experience has been that Exxon has not felt the need to request the presence of senior embassy officials during meetings with government officials.
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And why should it be otherwise? ExxonMobil’s investments in the Chad-Cameroon oil project would amount to $4.2 billion. Annual aid to Chad from the United States was only about $3
million
. “Only this pittance, in one of the ten poorest countries of the world,” Chris Goldthwait wrote.

As Exxon’s work around Doba expanded, Goldthwait traveled through the oil area and marveled at “just how much control the government [of Chad] has ceded to Esso over what happens in the south, almost a loss of sovereignty!” The company “calls the shots” in four of the country’s most populous administrative regions, he noted. Oil personnel managed security by suggesting travel routes and accompanying Chadian military and paramilitary patrols; they controlled local roads and ran their own satellite radio network reaching to the capital; and their spending on employment and construction in and around their oil fields dwarfed that by Chad’s government and foreign donors. Goldthwait observed: “Esso coordinates every step of the way with central and local authorities, but insists on what it needs; Esso rules the south.”
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W
illiam Foltz, a Yale University professor of African studies and political science, and the author of
Arms and the African
, visited N’djamena and delivered a lecture; Goldthwait went along to listen. The ambassador had been reading and reflecting on
Le Mendiant de l’Espoir
, or
The Beggar of Hope,
a novel by an imprisoned Chadian writer, Ali Abdel-Rhamane Haggar, who described the “root divisions” of Chadians, particularly “tribalism and corruption.” Foltz set Chad’s travails into the wider context of Africa’s transition from an earlier postcolonial era of periodic coups to “today’s much bloodier fighting in civil war,” a transition aided by the availability of weapons, the spread of dislocated refugees, and the ability of African governments to sell off resources to “finance the purchase of more weapons.” As he listened, Goldthwait jotted down other factors that the professor had not mentioned: “Ethnicity, a tradition of fighting, the fact that people have very little to lose, corruption, lack of results from government’s actions, lack of faith in democratic institutions.”

“The gap that bothers me the most,” Goldthwait wrote home, “is in our development model for a country as poor and isolated as Chad. We know what works at the grassroots to help farmers or herders take the first small step beyond subsistence. . . . And we can identify a handful of critical big-ticket infrastructure needs like paved, all-weather roads or reliable supplies of water or power. But this leaves a huge void before the country achieves sustainable economic growth—and we don’t know how to bridge it.”
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Shell and the French oil giant Elf Acquitaine originally joined ExxonMobil in the Chad project. Then an Elf chief executive, Loik Le Floch-Prigent, was indicted on embezzlement and international bribery charges; he was accused of skimming corporate funds and using some of them to pay off African and other overseas officials to win oil deals. (“It was like that before me,” Le Floch-Prigent claimed. “And my successors are doing it as well.”) Lee Raymond and his Dutch senior aide, Rene Dahan, once dined with Le Floch-Prigent in Paris and walked away shaking their heads. “I’m not doing that again,” Raymond barked at Dahan. ExxonMobil had its flaws, but outright crookedness was not one of them.

The scandal weakened Elf, led ultimately to a merger with Total, and forced ExxonMobil to find new partners in Chad. The Chad project had by now lasted three decades without producing a barrel of oil; it had turned out to be “a good example of long-term persistence, but a bad example of getting things done quickly,” as Harry Longwell, Raymond’s upstream lieutenant, put it dryly. The corporation finally roped in Chevron and PETRONAS of Malaysia as new nonoperating partners.

Chevron paid Déby’s government a “signing bonus” of about $25 million. The payment was not subject technically to the World Bank’s rules, but Déby had rashly pledged in public that he would apply the bank’s formula to all of his revenue. He changed his mind. There were rumblings of armed rebellions in the west, along his chronically troubled frontier with Sudan, near Darfur. Déby felt he needed to shore up his regime’s defense; he invested about $4.5 million in new military equipment before 2001 was out.
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A
fter years of absence from Chad following the cold war’s end, the Central Intelligence Agency reestablished a station in N’djamena around the time that ExxonMobil decided to go forward with the oil project. The threat of terrorism gradually drew its officers back. Even before the September 11 attacks, Al Qaeda menaced Africa. Osama Bin Laden, the group’s emir, lived in Khartoum, Sudan, between 1992 and 1996. He funded violence in Somalia and Ethiopia and built up cells in Kenya and Tanzania. The vision of pan-Islamic risings Bin Laden articulated reached the lightly governed regions of the Sahel, including northern Chad. From Sudan, Al Qaeda financed weapons shipments across the desert to sympathizers in Libya and Algeria. The reopened C.I.A. station in N’djamena was partially intended to address this threat. The station was “declared” to Déby’s government, meaning that the intelligence officers posted to Chad were known to their counterparts in the Chadian security services. The station evolved into a security liaison operation through which the United States could covertly provide training and equipment to counterterrorism units created by Déby for that purpose.
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After the September 11 attacks, the C.I.A. and the Pentagon’s Joint Special Operations Command no longer faced budget constraints; they charged into African capitals long neglected. At first, the coordination between the agency and the Pentagon in Chad and elsewhere in the Sahel was lacking. Deeply compartmentalized secrecy was the operational norm at both the C.I.A. and within the Special Forces. In the early months of 2002, the C.I.A.’s Africa division sometimes learned what the Pentagon was up to only through the reports of its paid local agents. The Pentagon lacked the language skills—particularly French—to set up new Special Operations liaisons with host governments like Chad’s without using translators. The translators would then be recruited as spies by the host government, so its leaders could keep track of what the Pentagon was planning. The C.I.A., running its own security liaisons, would hear about the Pentagon operators through the same translators. Once, in Ethiopia, local prostitutes were videotaped servicing American clients—the clients turned out to be Special Forces operators who were in the country without the knowledge of the local C.I.A. station, which then had to smuggle the Pentagon personnel out of the country before they were arrested. Gradually, the coordination improved. General Stanley McChrystal, a graduate of West Point, took charge of the Pentagon’s Joint Special Operations Command, which ran the operations against Al Qaeda in Africa. During the same period, after the September 11 attacks, C.I.A. director George Tenet appointed Mel Gamble, a longtime operations officer who had served in South Africa, Nigeria, Kenya, and Liberia, to run the Africa division in the C.I.A.’s Directorate of Operations. McChrystal and Gamble worked together on a series of covert counterterrorism initiatives in Chad and elsewhere in the Sahel.
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