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Viewing cable 08LAGOS57, NIGERIA: CHEVRON CONSIDERS GMOU MODEL SUCCESSFUL

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Reference ID Created Released Classification Origin
08LAGOS57 2008-02-13 16:05 2011-08-25 00:00 UNCLASSIFIED Consulate Lagos
VZCZCXRO7251
RR RUEHMA RUEHPA
DE RUEHOS #0057/01 0441605
ZNR UUUUU ZZH
R 131605Z FEB 08
FM AMCONSUL LAGOS
TO RUEHC/SECSTATE WASHDC 9744
INFO RUEHZK/ECOWAS COLLECTIVE
RUEHUJA/AMEMBASSY ABUJA 9476
RUEHNY/AMEMBASSY OSLO 0177
RUFOADA/JAC MOLESWORTH AFB UK
RUEKJCS/SECDEF WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHDC
RHMCSUU/DEPT OF ENERGY WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC
RUEAIIA/CIA WASHINGTON DC
RHEFDIA/DIA WASHINGTON DC
UNCLAS SECTION 01 OF 03 LAGOS 000057 
 
SIPDIS 
 
SENSITIVE BUT UNCLASSIFIED - HANDLE ACCORDINGLY 
SIPDIS 
 
STATE FOR AF/W, INR/AA, DS/IP/AF, DS/ICI/PII, DS/DSS/OSAC 
OSLO FOR HELENA SCHRADER 
DOE FOR GPERSON, CAROLYN GAY 
TREASURY FOR ASEVERENS, SRENENDER, DFIELDS 
COMMERCE FOR KBURRESS 
STATE PASS USTR FOR ASST USTR FLISER 
STATE PASS TRANSPORTATION FOR MARAD 
STATE PASS OPIC FOR ZHAN AND MSTUCKART 
STATE PASS TDA FOR NCABOT 
STATE PASS EXIM FOR JRICHTER 
STATE PASS USAID FOR GWEYNAND AND SLAWAETZ 
 
E.O. 12958: N/A 
TAGS: PGOV PREL SENV NI
SUBJECT: NIGERIA: CHEVRON CONSIDERS GMOU MODEL SUCCESSFUL 
 
REF: 07 LAGOS 628 
 
SENSITIVE BUT UNCLASSIFIED--HANDLE ACCORDINGLY 
 
1.  (SBU) Summary: Chevron has deemed its global memoranda of 
understanding (GMOUs) "largely successful" in building a 
sustainable community-driven approach to development, 
according to Femi Odumabo, Executive Director and General 
Manager of Chevron's Policy, Government and Public Affairs 
office.  Chevron hopes communities will be able to lobby 
state governments, international oil companies and other 
donors with a list of projects needed in their communities. 
While the GMOUs set up a community structure for identifying, 
approving and funding projects, Odumabo said this is 
complementary, not parallel to, government structures. End 
Summary. 
 
--------------------------------------- 
Government Rep: Chevron is a "Nice Guy" 
--------------------------------------- 
 
2.  (SBU) Compared to other international oil companies 
(IOCs), Chevron is a "nice guy," Femi Odumabo, Executive 
Director and General Manager of Chevron's Policy, Government 
and Public Affairs office told PolCouns on January 31. 
Chevron's Corporate Engagement (CE) office directs and 
manages assistance to oil producing communities in which the 
company operates; two thirds of the office's budget goes to 
communities through global memoranda of understanding 
(GMOUs).  One third of the CE budget goes toward Corporate 
Responsibility (CR) projects which are national in scope, 
including health (such as Rollback Malaria in Kano, Kaduna, 
and Zaria), education, water, and power projects. 
 
3.  (SBU) After the 2003 Warri conflict in Delta State, which 
damaged half a billion USD of Chevron's holdings, the CE 
office spent two years developing a GMOU approach to foster 
community-driven development.  Each GMOU is signed with a 
community (ethnic) group and creates the following: 
 
--Regional Development Council (RDC) composed of community 
members, NDDC, state government, Nigeria National Petroleum 
Corporation (NNPC), NGOs, donors and Chevron 
--Project Review Committee (introduces many projects) 
--Conflict Resolution Committee 
--Accounts Audit Committee (community, Chevron and government 
representatives are account signatories) 
--Community Engagement Management Board (CEMB) 
 
4.  (SBU) Each community, primarily through the Project 
Review Committee, develops a list of desired projects.  After 
receiving and reviewing bids, the community can fund a bid 
from its community account, which receives a percentage of 
Chevron's revenue from that area.  While Chevron reportedly 
gives USD 10.8 million a year to the Regional Development 
Councils, Odumabo noted Chevron never intended to be the sole 
financer and hopes the NDDC, state governments, and Oil 
Producing Area Development Commissions (OPADECs) of each 
state will also fund projects. 
 
------------------------------------------- 
GMOU "Largely Successful", Not Parallel but 
Complementary to Government 
------------------------------------------- 
 
5.  (SBU) Odumabo deemed the GMOU model "largely successful" 
based on the Sustainable Livelihood Assessment (SLA) reports, 
which Chevron teaches communities to conduct on their own. 
The SLA is a five day teaching workshop which offers skills 
training in project assessment, critical thinking, and how to 
 
LAGOS 00000057  002 OF 003 
 
 
systematically approach government with a list of projects in 
need of funding.  According to SLA results, the Itsekiri and 
Ijaw have been most successful at identifying, funding, and 
completing projects.  In addition to successes recorded 
through SLAs, Shell wrote Chevron a letter recognizing the 
strengths of this program and said it would borrow the model. 
 
6.  (SBU) Odumabo said Regional Development Councils are not 
parallel, but complementary, to government efforts; there 
have been no local government challenges to RDCs to date. 
Chevron hopes RDCs will use their three year development 
plans to express to government their needs, Odumabo suggested 
this could serve as a government accountability mechanism. 
He said Governor Olusegun Agagu of Ondo State was the first 
to offer 40 percent of the state's derivation revenue to the 
Ondo Oil Producing Areas Development Commission.  Odumabo 
estimated approximately 750,000 Niger Delta inhabitants have 
been positively affected by RDCs. 
 
7.  (SBU) Odumabo commented USAID is probably reticent to 
partner on IOC-driven development schemes, especially ones 
that could be seen as parallel government structures. 
However, he requested the USG support positive and successful 
efforts in the Niger Delta, rather than frequently focusing 
on the negative. 
 
-------------------------------------- 
River Boat Clinic; Nationwide Projects 
-------------------------------------- 
 
8.  (SBU) While Chevron corporate spends USD 30 million 
annually in Africa on malaria, HIV/AIDS and tuberculosis 
prevention, Chevron Nigeria provides approximately USD 35 
million a year to the Niger Delta Development Commission 
(NDDC). 
 
9.  (SBU) Chevron spent approximately USD 1 million in 2006 
to operate and maintain a river boat clinic in Delta state. 
This mobile hospital operates in swamps near Escravos; 
Chevron estimates 23,000 people were treated in 2007.  The 
river boat clinic was created after a Chevron medical 
facility near Escravos was twice burned, once in 1999, once 
in 2003.  Odumabo believed the clinic was burnt by a 
neighboring ethnic group in the area.  Odumabo was surprised 
the Delta State government has not replicated the successful 
river boat clinic, despite Chevron's work with the state in 
operating the boat. 
 
10.  (SBU) Comment: The GMOU structure adopted by Chevron is, 
in principle, similar to one devised by the NGO Pro-Natura 
International (Ref A), which has recorded successes in 
community-driven development efforts.  Notably different in 
Chevron's model is that it deals with an entire ethnic group 
(either the widespread Ijaw or geographically close Itsekiri) 
as one community; given previous ethnic strife and community 
access issues, it remains to be seen whether this will prove 
a successful and sustainable model.  Chevron's GMOUs offer 
IOCs a new approach to working with communities, and these 
efforts appear to gain companies favor as many Niger Delta 
interlocutors have commented positively on Chevron's 
community relations. 
 
11.  (SBU) However, from a broader development perspective, 
regional development has not markedly improved, nor do GMOUs 
appear to have decreased regional conflict.  Despite its good 
intentions, Chevron's GMOU may not help communities hold 
local and state governments responsible for development. End 
Comment. 
 
12.  (U) This cable was cleared by Embassy Abuja. 
 
LAGOS 00000057  003 OF 003 
 
 
BLAIR