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Viewing cable 06YAOUNDE1566, CAMEROON: EXXON FEARS EMPLOYEE UNREST IN SALE TO

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Reference ID Created Released Classification Origin
06YAOUNDE1566 2006-10-12 15:10 2011-08-23 00:00 UNCLASSIFIED Embassy Yaounde
VZCZCXRO7415
RR RUEHTRO
DE RUEHYD #1566 2851510
ZNR UUUUU ZZH
R 121510Z OCT 06
FM AMEMBASSY YAOUNDE
TO RUEHC/SECSTATE WASHDC 6824
INFO RUEHAB/AMEMBASSY ABIDJAN 0233
RUEHAN/AMEMBASSY ANTANANARIVO 0006
RUEHDK/AMEMBASSY DAKAR 0546
RUEHLC/AMEMBASSY LIBREVILLE 1308
RUEHLO/AMEMBASSY LONDON 1367
RUEHNR/AMEMBASSY NAIROBI 0087
RUEHNJ/AMEMBASSY NDJAMENA 1269
RUEHFR/AMEMBASSY PARIS 1593
RUEHTRO/AMEMBASSY TRIPOLI
RHEBAAA/DEPT OF ENERGY WASHDC
UNCLAS YAOUNDE 001566 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EINT ENRG ELAB ETRD EPET LY CM
SUBJECT: CAMEROON: EXXON FEARS EMPLOYEE UNREST IN SALE TO 
LIBYAN OIL FIRM 
 
 
1.  (U)  Summary.  ExxonMobil representatives told Charge 
October 11 that they feared their 85 employees in Cameroon 
might take "illegal action," possibly to include violence, to 
pressure Exxon to make cash concessions to its employees as 
part of the pending share sale of Exxon's Africa operations 
to Libyan oil company Tamoil Africa Holdings.  Company 
officials assessed Tamoil's interest in Exxon as part of 
Libyan leader Qaddafi's strategic decision to divest Tamoil 
of its European assets and focus instead on growing Tamoil's 
holdings in Africa.  End summary. 
 
2.  (U)  Jose Fabrega, Exxon Sales and Operations Manager for 
the West African Cluster, and two Exxon negotiators requested 
to brief CDA on their efforts to complete the sale of Exxon's 
fuel and lubricant businesses in Cameroon to Libya's Tamoil 
Africa holdings as part of a share sale that will also 
transfer ownership of Exxon assets in Gabon, Cote d'Ivoire, 
Kenya, Senegal, and Reunion.  Fabrega explained that, 
although the deal was signed on October 9, Exxon would retain 
day-to-day control over the operations pending CEMAC 
approval, a process he expected would take about two months. 
 
3.  (U)  In the meantime, Exxon officials worry, Exxon's 85 
office workers may resort to "illegal action" to further 
their demands that Exxon compensate them as part of the sale. 
 According the Fabrega, the employees claim compensation 
under Article 42 of the Cameroonian labor code, which 
establishes employee rights to compensation in the event of a 
merger or similar action resulting in a new employee 
contract.  Since the Exxon sale is a share sale, with no 
change of employee contract, argued Fabrega, Article 42 does 
not apply and the workers are due no compensation.  Exxon has 
met with the Cameroonian Prime Minister and the Ministers of 
Labor, Energy, and Finance.  Fabrega told us that the 
Cameroonian authorities uniformly share Exxon's assertion 
that Article 42 does not apply in this situation.  At the 
request of the Cameroonian government, Exxon is negotiating 
with the employees through a neutral "commission." 
 
4.  (U)  Nonetheless, Fabrega explained, given the worrying 
precedent where Cameroonian workers have been able to wring 
concessions from foreign companies through violence and 
threat of violence, Exxon remains worried that its employees 
may resort to illegal actions to further their demands. 
Recalling that local employees of Shell and Wackenhut 
kidnapped senior managers to win concessions in similar 
disputes, Fabrega lamented, in Cameroon, "there is a 
precedent that violence pays."  Exxon has contracted security 
firm Sterling Company, whose unarmed consultants will seek to 
preempt any violence against Exxon representatives.  CDA told 
the Exxon officials that the Embassy would be prepared to 
intervene with Cameroonian authorities to help prevent 
violence and to help ensure that relevant Cameroonian 
regulations were respected. 
 
5.  (U)  Fabrega assessed Tamoil's interest in Exxon as part 
of Libyan leader Qaddafi's strategic decision to divest 
Tamoil of its European assets (currently for sale) and focus 
instead on growing Tamoil's holdings in Africa. 
 
6.  (U)  Minimize considered. 
NELSON