How the “Curse of Oil” Could Spill Into Uganda & What That Would Mean for Conservation, the Economy & Community

Abby Schneider, Ph.D.
Assistant Professor, Marketing
SEED Institute Fellow
College of Business and Economics
Regis University

Extreme poverty is a major issue facing many sub-Saharan African nations, including the East African country of Uganda. According to the World Bank, as of 2013, 34.5% of the Ugandan population (or 13 million people) was living on $1.90 PPP per day or less. Additionally, many Ugandans lack access to amenities such as education, healthcare, clean water, and electricity (World Bank, 2016). However, efforts to develop economically and improve infrastructure often come into conflict with environmental conservation, and one such initiative that is currently causing tension involves drilling for oil in Uganda’s revered Murchison Falls National Park. While the project, which involves British, French, and Chinese oil companies, could potentially bring economic gains to this impoverished nation, the plan to extract oil from the park, under which 40% of Uganda’s oil lies, has incited significant controversy on multiple fronts (EnergyDesk, 2016).

First, the extent to which Uganda itself would profit from the extraction of oil is unclear, and any economic gains that Uganda might realize from the oil could be offset by a blow to the tourism industry (Akumu, 2013). Second, even if Uganda does profit from extraction, the extent to which the government elites, versus individual citizens, would benefit is debatable. As one Ugandan conservationist put it, “oil is political capital.” Third, the project poses threats to the park’s rich biodiversity and ecosystems, including species such as the Rothschild’s Giraffe that are already endangered (EnergyDesk, 2016). Finally, drilling for oil has cultural implications. While the economic, political, and environmental consequences have received quite a bit of attention, the cultural implications have been somewhat overlooked. Thus, the current post seeks to synthesize academic theory, news reports, and personal interviews to develop a more holistic view of how drilling for oil in Murchison Falls National Park could impact Uganda.

Uganda_Regions_mapEconomic Implications of Oil Extraction

While the presence of oil in Uganda has been discussed since 1927, 2006 marks the discovery of commercially viable oil (now estimated at over 3.5 billion barrels) that has the potential to be used for diesel, paraffin, and aviation fuel (Briggs and Roberts 2013; Akumu, 2013). Revenue from this oil could then be used to deliver myriad economic benefits to such sectors as healthcare (e.g., by improving hospitals) and education (especially primary education), helping to fuel the investment necessary for development (Briggs and Roberts 2013; Akumu, 2013). Oil money could also potentially be used to bring electricity to the 90% of Ugandans who live without it (Akumu, 2013). Thus, despite the fact that Murchison Falls National Park is the largest protected area in Uganda (Briggs and Roberts 2013), the government wants to proceed with exploration and drilling because the oil money could potentially fund the country for the next 20 years (Akumu, 2013). Similarly, citizens living in communities neighboring the park are optimistic about their own financial gain from the oil and the jobs that oil exploration could create (personal interview).

However, the economic potential of drilling is not without its limitations. First, tourism revenue currently accounts for somewhere between 4%-9.9% of Uganda’s GDP (Akumu, 2013; personal interview), and Murchison Falls National Park is one of Uganda’s top tourism destinations (Briggs and Roberts 2013).

With oil rigs obstructing the pristine view of the park and the wildlife being impacted, tourists are unlikely to continue frequenting Uganda as a safari destination. Furthermore, the loss in revenue from the tourism industry is unlikely to be offset by any potential gains from drilling for oil, especially in terms of the oil dollars trickling down to the average citizen.

Already, allegations of corruption have surfaced (Akumu, 2013). Supporting such claims, President Yoweri Museveni has proclaimed the oil to be his, and despite billions already having been paid by the oil companies in the pre-production stages, there has been no discernible change in the quality of services available to average citizens or the state of poverty in the country more generally (Akumu, 2013).

In Northern Uganda, especially, local citizens are feeling “left out” because they are being casually employed in difficult, unskilled labor jobs from which they could be fired at any time (the lure of such jobs is also causing young people to drop out of school in order to make money, and the jobs available to local citizens only account for about 3% of the total oil jobs to begin with; personal interview). When exploration first began, average citizens also did not understand the refinement process, thinking that they could simply get oil for their cars directly from the well (personal interview). This misperception has left many Ugandans feeling as though the government and foreigners are taking their oil away (personal interview).

On top of losing their oil resource, local communities are seeing the price of land go up, leading to “land-grabbing” by the rich (personal interview). Such results of drilling are not uncommon in Africa, which is why the discovery of oil is often thought to be a “curse.”

In Nigeria, for example, it was found that, over time, the extraction and commercialization of oil has actually exacerbated inequalities, poverty, underemployment, and environmental degradation (Hutchful, 1985). Thus, if Uganda is to go ahead with drilling, it will be important to ensure that individual citizens, and not just large multinational corporations and politicians, benefit from the natural resource (Maathai 2009). To that end, educating local communities about the extraction process will be important so that average citizens do not get “left out” of the spoils. Already, conservationists are running oil awareness programs that provide neutral information about oil drilling to the impacted communities (personal interview). Moreover, if locals do gain financially from the oil, financial literacy training may be beneficial, as many locals do not understand how much certain amounts of money are worth (personal interview). Thus, any financial benefit of drilling for oil will require taking a holistic approach in local communities.

Political Implications of Oil Extraction

The question of who, or which country, benefits from this extraction creates a further challenge in this specific dilemma. Because some oil reservoirs beneath Murchison Falls National Park are shared between Uganda and the Congo, if there are profits to be made from extraction, Congo will surely want to share in the spoils (Briggs and Roberts 2013). As with many conflicts in Africa, the scramble for natural resources and the proceeds of oil could certainly fuel a military conflict along the Uganda-Congo border. Political tensions with other nations could arise, as well. Because the Rift Valley drains directly into the Nile, a potential oil spill could cause conflict with Sudan and Egypt. Thus, the prospect of drilling in Murchison Falls National Park is mired in political tension that extends beyond Uganda’s borders.

Environmental Implications of Oil Extraction

uganda-grey-crowned-crane-1502935_1280
The grey crowned crane is the national bird featured on the flag of Uganda. (Photo courtesy of Pixabay).

Perhaps one of the most expansive impacts of drilling will manifest in the environment. Murchison Falls National Park lies along the Albertine Rift, “one of the most biodiverse regions on the planet” (Jordahl, 2010). The area in question is the biggest game reserve in Uganda, and it includes about half of Africa’s bird species (Akumu, 2013). The park is also home to some of the last populations of the endangered Rothschild’s Giraffe (EnergyDesk, 2016). It is still unclear as to exactly how drilling will affect the wildlife, but it will unequivocally impact the ecosystem, which has repercussions for the rest of the world (Akumu, 2013; Berntsen, 1995; Maathai 2009). Not only could drilling mean the displacement of animals or higher stress levels among those that can’t migrate (Jordahl, 2010) but also, restricted habitat area could be problematic for animal reproduction. For example, some animals, such as cheetahs, require chases over long distances in order for the female to ovulate or become sexually receptive (Diamond, 1999). Thus, habitats diminished by the extraction process would be less conducive to the reproduction process of some species.

Diminished habitats are also likely to play into another economic and environmental tension prevalent in the region—poaching. Increased animal migration due to drilling could push animals, particularly elephants, toward the outer edges of the park, closer to settled communities and farmed areas.

According to one Ugandan conservationist, the greatest concern, thus far, as a result of the arrival of the petroleum companies in Murchison Falls National Park, is that elephants are entering into settled communities and destroying farmers’ crops in search of food (personal interview). Farmers, financially devastated by the elephants’ destroying a season’s worth of crops in one night, then shoot and kill the elephants in retaliation and to prevent the crop raiding from happening again. Such encounters with the wildlife have led to the neighboring communities’ having negative views of the park and poor relationships with park managers (personal interview). As a result, park rangers are trying to change the locals’ mentality about the park and help them understand the economic and environmental importance of the park (personal interview). One way they are doing this is by allowing locals to visit the park for free on certain days and even providing cars to get there (personal interview). They are also participating in revenue sharing whereby 20% of the park’s proceeds go to neighboring communities to develop infrastructure such as hospitals and schools (personal interview). Conservationists are not, however, offering compensation to the neighbors whose crops are destroyed (personal interview).

uganda-elephant-pic-by-abby
Murchison Falls National Park, Uganda (courtesy of Abby Schneider)

With regard to improving human-wildlife relationships and protecting the elephants, conservationists are working with farmers and their communities, advising them on how to build buffer zones using trenches, fences, noxious plants, beekeeping, and organic repellants to keep the elephants out of their crop fields (personal interview). Conservationists are also advising the farmers on which crops do not attract elephants and are, therefore, potential growing alternatives (personal interview). If elephants do enter communities, conservationists are working to create reporting systems, and they are working with community scouts who herd the elephants back to the park (personal interview).

Finally, a more obvious environmental concern hails from explosions, flares, and the pollution of land and water (DeLancey, 2013). More research is required to determine the exact extent of the environmental damage that could result from drilling, but it is clear that the risk of environmental degradation is large.

uganda-murchison-national-park-2111157_1280
Murchison Falls National Park (courtesy of Pixabay)

Importantly, it must be understood that this apparent tension between environmental sustainability and economic development is a false dichotomy (Berntsen, 1995; Nyang’oro, 2013). As with any country, the long-term future of Uganda’s economic development depends on environmental preservation and sustaining the natural environment for future generations (DeLancey 2013; Maathai 2009). Economic benefit at the cost of environmental destruction is a short-term solution, and any real solution to poverty will require a holistic approach that puts environmental sustainability at the core, as the health of the ecosystem impacts the ability to achieve other development goals (Maathai 2009). This connection between the environment and development is especially apparent in the present context as those likely to be the most affected by drilling in Murchison Falls National Park are also the most vulnerable citizens, mired in poverty and lacking education (Akumu, 2013). Thus, the cultural and social implications are paramount.

Cultural and Social Implications of Oil Extraction

“The discovery of oil in this area is not a blessing for everyone. [Some people] are deeply affected” (Ugandan Conservationist)

While the economic, political, and environmental consequences of drilling for oil in Murchison Falls National Park have received considerable attention, the cultural and social implications have been somewhat overlooked. Already, the prospect of drilling has brought violence to surrounding communities. Citizens are being coerced into signing over their land, causing them to be separated from their communities, as the government decides where they relocate (personal interview). Other people are being arrested and beaten for questioning the government’s involvement with the project (Akumu, 2013). Even within families, the effects of oil exploration are disrupting cultural norms. For example, when families are compensated for oil, both the men and women feel entitled to receiving the money.

In addition, the presence of oil workers is impacting local cultures, as the workers impose their own cultures on the communities. For example, the dress codes are changing, and local citizens want to speak Luganda because many of the Ugandans employed by the oil companies do. The presence of oil workers has also fueled the growing social and public health concern of increased prostitution, which is potentially exacerbating the spread of HIV/AIDS (personal interview). In addition, many young girls are dropping out of school when they become pregnant as a result of prostitution (personal interview). Only now, after some training from conservationists, are people becoming aware of their rights as citizens (personal interview).

Still, communities are not empowered to dissent, and the government has compulsory acquisition and mineral rights of all land. “There is no way communities can stop the government [from drilling],” acknowledges one local conservationist. Given this situation, the prospect of drilling for oil continues to pose economic, political, environmental, and human rights tensions with communities in Uganda and ultimately—around the world.

Conclusion

uganda-162449_1280Uganda, like many African nations, is affected by a large percentage of its population living in extreme poverty. With the discovery of commercially viable oil reserves in 2006, the government sees the potential of oil revenue to improve healthcare, education, access to electricity, and investment in other amenities that could help the country achieve its development goals. However, drilling for oil is not without its consequences, as the prospect of drilling is causing tension with other economic sectors, political priorities, environmental sustainability initiatives, and human rights issues. In order to further understand and monitor the effect of big business on the environment and human rights, it will be important for future research and journalistic agendas to continue to explore the effects of drilling for oil in Uganda’s most revered National Park, Murchison Falls.

Summary

Despite the potential economic benefits of drilling for oil in Murchison Falls National Park, proceeding with oil extraction is likely to lead to increased corruption (Akumu, 2013), damage to the tourism industry (Akumu, 2013), environmental degradation (Akumu, 2013; Berntsen, 1995; DeLancey, 2013; Jordahl 2010; Maathai 2009), international political strife (Briggs and Roberts 2013), and violence aimed at local communities (Akumu, 2013). Moreover, human rights violations may extend beyond physical violence to the psychological ramifications of shifting cultural and social norms. It will be important for future research and journalistic agendas to continue to explore the effects of drilling for oil in Murchison Falls National Park.

Discussion Questions

  1. What are the potential benefits and limitations of drilling for oil in Murchison Falls National Park, and do the potential benefits of economic growth for Uganda outweigh the potential consequences?
  2. How can big business operate in such a way that it conserves environmental resources for future generations?
  3. What effect would diminishing the Ugandan ecosystem have on the rest of the world?
  4. What role, if any, should the West play in conservation efforts in Africa or other parts of the developing world?
  5. What are the similarities and differences between the prospect of drilling for oil in Murchison Falls National Park, Uganda and the Dakota Access Pipeline, USA?

References

Akumu, Patience. (2013, December 28). Ugandans Fear Curse of Oil Wealth As It Threatens to Blight “Pearl of Africa.” The Kampala Observer. Retrieved from https://www.theguardian.com/world/2013/dec/29/ugandans-oil-blight-pearl-africa

Berntsen, Thorbjorn (1995). Challenging Traditional Growth. Our Planet, 7(1), 11-12.

DeLancey, Virginia (2013). The Economies of Africa. In April A. Gordon & Donald L. Gordon (Eds.), Understanding Contemporary Africa (5th ed.) (115-165). Boulder, CO: Lynne Rienner Publishers.

Diamond, Jared (1999). Guns, germs, and steel: The fates of human societies. New York: W.W. Norton & Company.

Energy Desk Staff (2016, September 26). British Government Backing Big Oil’s Plans for Drilling in Africa’s National Parks. MintPress News. Retrieved from http://www.mintpressnews.com/british-government-backing-big-oils-plans-drilling-africas-national-parks/220790/

Hutchful, Eboe (1985). Oil Companies and Environmental Pollution in Nigeria. In Claude Ake (Ed.), Political Economy of Nigeria (113-140). London: Longman.

Maathai, Wangari (2009). The challenge for Africa. New York: Anchor Books.

Mark Jordahl. (2010, October 5). Impact of Oil Development on Wildlife Not Always Obvious (Web log comment). Retrieved from http://wildugandablog.com/impact-of-oil-development-on-wildlife-not-always-obvious/

Nyang’oro, Julius E. (2013). Africa’s Environmental Problems. In April A. Gordon & Donald L. Gordon (Eds.), Understanding Contemporary Africa (5th ed.) (243-275). Boulder, CO: Lynne Rienner Publishers.

World Bank (2016, September 20). Uganda Poverty Assessment 2016: Fact Sheet. Retrieved from http://www.worldbank.org/en/country/uganda/brief/uganda-poverty-assessment-2016-fact-sheet

Prof. Abby Schneider at Regis University:

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