AFRICA IN WASHINGTON - The Permanent Guide #13 - 01/01/00

AFRICA/UNITED STATES : THOMAS PICKERING

Often described as the "most experienced diplomat" within the State Department, Pickering is the number three of American diplomacy.

He has served as ambassador in six countries (Jordan, 1974-78; Nigeria , 1981-83; El Salvador, 1983-85; Israel, 1985-88; India, 1992-93 and Russia, 1993-96), and occupied the United States' seat in the United Nations' Security Council between 1989 and 1992.

Pickering began his career in 1956 in the American Marine Corps, leaving three years later with the title of Lieutenant Commander. He subsequently joined the State Department where he worked in the Bureau of Intelligence and Research and in the Arms Control and Disarmament Agency.

Later he was posted to Zanzibar and to Dar Es Salaam, returning to Washington in 1969 to head the State Department's Bureau of Political and Military Affairs. He was then named assistant to Secretary of State Henry Kissinger before departing for Jordan in 1974. After returning from Amman, he became Undersecretary for Scientific, Environmental and Oceanic Affairs.

Thomas Pickering is a graduate of Bowdoin College in Maine and of the Fletcher School of Law and Diplomacy of Tufts University.

AFRICA ENERGY & MINING #243 - 06/01/99

UNITED STATES/AFRICA : DRAFTING AN OIL POLICY?

A closed-door meeting in Washington just before New Years gave rise to what could appear as an American effort to dovetail activity concerning the oil industry in sub-Saharan Africa. Nobody came forward to talk of an "African oil policy" for the U.S. Indeed, such a concept is taboo, like the thought of any oil policy at all. Indeed, the very existence of an Energy Department is still the subject of debate in Washington, which sticks to the market forces approach on every occasion, as was the case concerning conferences between producers and consumers proposed by Venezuela and France in the early 1990s, prompting several gatherings of a consultative nature. Sponsored by the State Department, the meeting in Washington was aimed at "establishing a policy of cooperation between a number of U.S. government agencies and corporations," an unidentified senior Energy Department (DOE) official declared.

The government side was represented by under-secretaries of state Stuart Eisenstat and Thomas Pickering, the assistant secretary of state for Africa, Susan Rice (who recently toured central Africa, and particularly Democratic Republic of Congo and Angola), and officials from DOE, USAID, the National Security Council and the Central Intelligence Agency, which has become increasingly involved in business intelligence since the end of the Cold War. On the corporate side were executives from American oil groups that operate in Africa, starting with Exxon, Mobil, Chevron and Texaco. But the few reports about the meeting that leaked out said the two sides only traded notes, drew up an inventory of American oil assets in central and western Africa and made note of investments, trade patterns and the regulatory environment in the region. According to the senior DOE official, various government agencies have some money available to support U.S. commercial policy by, for example, funding legal reform in the area.

The oil companies, for their part, were not whishing to voice comments about the meeting even though some officials did tell news agencies that the initiative could prove beneficial if it did not result in the government pushing companies too aggressively to serve U.S. foreign policy goals that didn't take economic realities into account. Indeed, one of the major issues thought to have been broached is the potential conflict between Washington's foreign policy goals and corporate goals, particularly in the highly volatile nations of Nigeria , Angola and the Democratic Republic of Congo.

Gerald Kepes, managing director of Petroleum Finance Co. in Washington, seemed doubtful about what the government could offer the U.S. oil industry which already had deep roots in the region. Up to recently, the DOE's dealings with Africa were restricted to only South Africa, Ghana and Senegal, none of which were big producers. And Kepes pointed to what he called the government's "disastrous" backing for an oil pipeline from Baku in Azerbaijan to a Turkish port on the Mediterranean. The initiative, he said, was "ill considered and damaged government credibility in the industry." (Washington's backing for the scheme could be said to stem essentially from its propensity to decree sanctions – in the instance, the sanctions that ruled out a trans-Iranian pipeline.)

A.E.M. - Although a recent draft law aimed at spurring U.S. investment in Africa ran into a wall in Congress it's rather hard to believe oil isn't a key factor in American policy towards West Africa. Indeed, countries in the region provide nearly 15% of the oil that the U.S. imports, with Angola and Nigeria in the forefront – the latter nation alone provides 10% of imports. To be sure, the United States buys around half of Nigeria 's output of 2 million bpd of oil (the amount dropped recently because of unrest in the south) due to the heavy presence of American companies and the quality of Nigerian crude, well suited to American refining needs. Elsewhere, American oil firms have been increasingly active throughout the entire region in recent years. Sometimes spectacularly so, as has been Exxon's case in the deep offshore in Angola and Congo; a lot can be expected from its merger with Mobil which, for its part, is well established in Nigeria , Equatorial Guinea and, most recently, in the Sao Tome et Principe offshore (AEM 241).

Indeed, the quest for better coordination in the U.S. industry coincides with the drop in crude prices which could well hasten the move by governments to withdraw from the oil sector and to adopt legislation to facilitate investment. The outlines of this were apparent in Nigeria two months ago (AEM 236) and on Jan. 1, when the government announced tax credits aimed at spurring investment in the deep offshore, including on licenses that had already been awarded. On Dec. 30 the government adopted a draft 1999 budget based on oil at a price of $9 per barrel (compared to $17 in the draft 1998 budget). Nigerian president Abdusalaam Abubaker estimated that the collapse in oil prices had cost Nigeria some 200 billion nairas (over $2.2 billion) in 1998. It has also led to a cutback in investment in exploration. A survey by the Salomon Smith Barney investment bank calculated that exploration budgets would drop by 11% world-wide this year to $79.2 billion. But, like other establishments, the bank came to the conclusion that Africa has become a prime area for E&P investment and would not be hit by the reduction.

--------------------------------------------------------------------------------

INTELLIGENCE ONLINE is published by INDIGO PUBLICATIONS

142 rue Montmartre 75002 Paris France

Tel. : +33 1 44 88 26 10

Fax : +33 1 44 88 26 15 Managing Editor : Maurice Botbol

Webmaster : Eric Michel

Electronic Accounts : Muriel Leclert

Subscriptions : Marie-José Arbiturer