Wednesday, October 22, 2014

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Review − The New Kings of Crude

Luke Patey's new book tells the nuanced story of China and India's struggles to extract oil in the high-risk settings of Sudan and South Sudan.
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China’s role in Africa seems to a subject of almost limitless interest − especially when it comes to ideas of large-scale resource extraction. Evoking images of another imperial struggle for dominance on the continent, much debate focuses on the perception of China being in the driving seat in its dealings with African governments. And, particularly in the American press, Chinese policy is often portrayed as ‘locking up’ access to crude supplies, making it increasingly difficult for private Western companies, with their different business models, to acquire oil security in a world of increasing demand.

Luke Patey’s intricately researched book, The New Kings of Crude, aims to correct some of these Western stereotypes of China and its ambitions in Africa − specifically the oil rich nations of Sudan and South Sudan. Patey's mastery of the subject is clear and, despite the proliferation of international conferences and media debates over China’s role in Africa, this long-form analysis is a welcome addition to a surprisingly empty bookshelf on the subject.

From Tigers to Dragons

Patey’s book begins in 1984 when a group of southern Sudanese rebels in Unity State attacked the Rubkona base camp which had been set up by the US multinational energy corporation Chevron in the 1970s. Three workers died in the incident, which seemed to have been a bungled stunt gone wrong and which had rapidly escalated into horror on that dark, malarial night. The Rubkona attack is a stark reminder of both the deep-rooted nature of the current conflict in South Sudan and the extraordinary risks international oil companies take to secure oil concessions.

The book goes on to tell the story of pioneering contractor Brian Kay who took on the challenge of prospecting for resources in Chevron’s enormous half a million square kilometre concession, much of which was dominated by the Sudd, a huge swamp formed by the White Nile basin. Patey describes machines with names such as the Ty-Ty Tiger and the Lily-chopper, which were flown in by helicopter to allow the crews to work on the wetlands, though Chevron’s dreams in the end amounted to nothing. In 1992, the company pulled out of Sudan after 20 years and $1 billion of investment without ever having drilled a drop − a consequence of the continual threat of insecurity and disruption.

In 1995, the Chinese stepped into Chevron’s shoes and used the US oil company’s geological maps and basic infrastructure to help them get started in production which would eventually yield over 400,000 barrels per day. The New Kings of Crude details the rapid development of the pipeline infrastructure to transport the oil from Bentiu and Unity states in the south to an oil terminal at Port Sudan in the north. The legacy of this arrangement is ever present in the complex situation today. In 2012, shortly after the south seceded to become South Sudan, arguments over what it should pay to Khartoum in transit fees for the oil caused a shut-down in production. Furthermore, South Sudan's President Salva Kiir seems determined to break its reliance on north pipelines by constructing a new pipeline to Lamu on the Kenyan coast.

A nuanced account

Rather than paint a picture of the China National Petroleum Company (CNPC) as omnipotent and in full control of its own destiny in Sudan, Patey tells a rather more nuanced story of inter-dependence between the company and the Sudanese government. He also reflects upon the almost unknown history of Indian national oil companies in Sudan and describes in detail how the CNPC was indelibly affected when five of its workers were kidnapped and killed by disaffected Misseriya fighters in the so-called ‘10.18’ incident in 2008. Patey suggests that the experience greatly shaped the company’s security practices and community liaison efforts.

The author further recounts how the CNPC came to feel the pressure from a divestment campaign launched by students in the US in response to the conflict in Darfur and China’s perceived failure to criticise the actions of the Khartoum government. While these efforts ultimately had limited results, it did lead to other civil society campaigns against Chinese national oil companies investing in US markets. And this in turn arguably led former Chinese president Hu Jintao to break the sacred Chinese commitment to non-interference and urge Sudan's President Omar al-Bashir to find a resolution to the Darfur crisis on a visit to Khartoum in 2007.

With the ongoing crisis in South Sudan and the CNPC‘s current operational difficulties, it would have been preferable for Patey to include more focus on the unresolved issues relating to oil in Sudan’s Comprehensive Peace Agreement (CPA) in 2005 − which established the roadmap that led to South Sudanese independence − and the South’s decision to secede in 2011.

In the book, there is also an occasional tendency to tell the story in a non-chronological way, which makes it difficult to discern exactly which events were the most crucial. Nevertheless, the book is written in a personable and character-driven style, making it accessible to the general reader and those with an academic interest. Its greatest strength, however, is that it provides a comprehensive history to the never-ending complexities of Sudanese politics which continue to dictate events to this day.

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For further reading around the subject see:

 

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