Liam Fox’s Support For Oil Executives Mired In Scandal Shames His Government And This Country

Such uncritical support of the sector ignores the appalling impact that corruption has on developing countries, and shows this government is merely paying lip service to the Paris Climate Agreement
Peter Nicholls / Reuters

Nigeria’s recent presidential election comes at a time when the country is in worrying shape: its recovery from recession is slowing, nearly a quarter of the working age population are unemployed, and power shortages remain a common part of everyday life.

It shouldn’t be like this. Nigeria is the wealthiest nation in Africa, mostly because it’s the continent’s largest oil producer, pumping about 2.5 million barrels a day.

But, as we have seen elsewhere, large oil reserves can be a blessing or a curse.

Systemic corruption means that the proceeds from this lucrative industry have failed to be shared widely with Nigeria’s population, hampering its economic development: but it is crucial to understand that the roots of this corruption reach far beyond Nigeria’s borders, all the way to the UK.

This week sees the resumption of a criminal trial in Milan’s Palace of Justice that tells this story – and British corporate involvement in it – all too clearly. The court case in question is that of several former executives from UK-based oil and gas giant Shell, which infamously claimed in ‘WikiLeaks cables’ released in 2010 that it had penetrated every level of Nigerian government. The allegations are astounding.

In 2017, anti-corruption watchdog Global Witness published leaked emails allegedly showing that Shell’s most senior executives knew that a $1.1bn payment for a huge Nigerian oil block, known as OPL 245, would line the pockets of a convicted money launderer, and then flow into a vast bribery scheme allegedly set up to benefit some of Nigeria’s most senior politicians.

Just three months ago, Global Witness made fresh allegations that the deal that Shell secured also included hidden terms to boost their profits, depriving Nigeria of a further $5 billion dollars in estimated future revenue – more than double the combined annual education and healthcare budget of Nigeria – that should have been going into the country’s public services.

The case has been described as one of the biggest corporate corruption scandals in history. But as the trial continues this week, one of its defendants won’t be in the courtroom. Instead, Malcolm Brinded – a former executive director at Shell and a trustee of the Shell Foundation – was chairing a panel in a luxurious Mayfair hotel alongside our very own Secretary of State for International Trade, Liam Fox.

Fox and Brinded shared a stage as part of the International Petroleum Week conference, ‘one of the biggest events on the global oil and gas calendar’ – which convenes 1,500 of the great and the good from the international oil industry. For Brinded to moderate a discussion at this high-profile event shows a reckless disregard for the reputational integrity of the oil and gas industry, by the oil and gas industry. For the government’s trade minister to join him there is a damning sign of the UK Government’s uncritical support of the sector.

Liam Fox’s International Trade department has embraced deals with other corruption-embroiled fossil fuel companies. In 2015, UK Export Finance (UKEF), part of Fox’s department, provided £115 million in support to Brazilian oil company Petrobras, while it was at the centre of ‘Operation Car Wash,’ the largest corruption inquiry in Brazilian history.

There’s a wider question this line-up raises. Despite paying lip service to the Paris Climate Agreement, the UK Government continues to make huge subsidies to fossil fuels.

Research by CAFOD and the Overseas Development Institute has shown that in the last measurable period, UKEF gave a staggering 99.4% of its support for the energy sector to fossil fuels, leaving next to nothing for investment in clean energy.

In an extraordinary move last Sunday, former UN Secretary-General Ban Ki-Moon publicly criticised the UK Government on UKEF’s fossil fuel support and called on the Government to stop investing in fossil fuels overseas entirely. That’s why a Labour government is committed to ending overseas aid contributions to fossil fuels and has pledged to promote UKEF support towards low-carbon projects, reorienting it away from fossil fuel projects.

The OECD has found the oil, gas and mining sector to be the most corrupt on the planet. Liam Fox’s disproportionate and indiscriminate support of fossil fuels ignores the endemic and damaging corruption at play, and holds us back from the fossil fuel-free future we need to build now.

Science tells us we need to keep the majority of fossil fuels in the ground, and that we must urgently invest in renewable energy, and other alternative industries. Doing so would create millions of jobs, ensure a fair transition for fossil fuel workers into new industries, and avert the most catastrophic climate breakdown.

Science also tells us we’re running out of time. The future can be just and green – not corruption-mired and polluted. But only if we’re prepared to break with the past and embrace a healthier, cleaner energy system, and to do so quickly.


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