Developments in US$1.2 billion Chad-CNPC arbitration court hearing

The China National Petroleum Corporation (CNPC) has denied breaking environmental rules in Chad’s oil sector and demanded the Chadian government drops its US$1.2 billion claim at an arbitration court in Paris.

The dispute began in July 2013 after Chad said it discovered large quantities of crude had been dumped into pits dug in the Koudalwa region, where CNPC has held licenses to several oil blocks since 2009.

The CNPC was forced to suspend operations in Chad this May after refusing to pay the US$1.2 billion fine for "unacceptable practices" which led to "noxious spills" around drilling sites.

Secretary-general of the Chadian government, Abdoulaye Sabre Fadoul, at a news conference at the beginning of August, stated that "Amicable negotiations are no longer possible. All efforts have been in vain… That is why we have decided to take a complaint to the arbitration tribunal in Paris, as agreed under the terms of our contract with CNPC." 

As well as taking the case to the International Arbitration Chamber of Paris, the minister said the government had lodged a complaint against CNPC at a court in N'Djamena for ‘environmental destruction and endangering lives’ and had cancelled five exploration licences held by CNPC.

A spokesman for the Chinese oil company could not be reached for a response to the minister’s statement. Speaking this week at the arbitration hearing, however, a CNPC spokesperson said that the leaked oil consisted of a "small amount" and its own analysis had not shown penetration into the ground water.

The firm added that it was hoping for the "cancellation of this decision and an ongoing effort to resolve this negotiation amicably," adding that the government has declined to provide the firm with a breakdown of damage to justify the large claim.

Chad, which began exploiting its oil deposits in 2003, has a history of difficult relations with Chinese companies operating on its soil.  In March, Chadians working for Great Wall Drilling Corporation and China National Logging Corporation went on strike to denounce their working conditions and demand salary increases.

For more news and expert analysis about the Sahara region, please see Sahara Focus.

© 2014 Menas Associates

Chad to take CNPC to Paris arbitration court

Chad is reportedly making preparations to take China National Petroleum Corporation (CNPC) to an arbitration court in Paris after compensation talks stalled. Chad has levied a claim for US$1.2 billion in compensation from the Chinese state-owned company for breaking the country’s environmental rules, according to reports.

Chad's oil minister, Djerassem Le Bemadjiel, told a news conference on Saturday that the move was "to avoid further environmental degradation, not to make place for other companies".

The dispute began in July 2013 after Chad said it discovered large quantities of crude had been dumped into pits dug in the Koudalwa region, where CNPC has held licenses to several oil blocks since 2009.

The CNPC was forced to suspend operations in Chad this May after refusing to pay the US$1.2 billion fine for "unacceptable practices" which led to "noxious spills" around drilling sites.

Secretary-general of the Chadian government, Abdoulaye Sabre Fadoul, at a news conference last week, stated that "Amicable negotiations are no longer possible. All efforts have been in vain… That is why we have decided to take a complaint to the arbitration tribunal in Paris, as agreed under the terms of our contract with CNPC."

As well as taking the case to the International Arbitration Chamber of Paris, the minister said the government had lodged a complaint against CNPC at a court in N'Djamena for ‘environmental destruction and endangering lives’ and had cancelled five exploration licences held by CNPC.

A spokesman for the Chinese oil company could not immediately be reached for comment.

Chad, which began exploiting its oil deposits in 2003, has a history of difficult relations with Chinese companies operating on its soil.  In March, Chadians working for Great Wall Drilling Corporation and China National Logging Corporation went on strike to denounce their working conditions and demand salary increases.

For more news and expert analysis about the Sahara region, please see Sahara Focus.

© 2014 Menas Associates

Qadhafi is losing control of Libya's borders

While the media speculation on how long Colonel Mu'ammar Qadhafi will stay in power continues, one thing seems clear: he is fast losing control of his country's borders.

Thousands of foreign nationals have been fleeing the country by both its eastern land border into Egypt and its western land border into Tunisia in recent days as Tripoli's airport struggles to cope with the number of people wanting to leave.

Reports from the border with Egypt have suggested that opposition forces have gained control of the border. According to the BBC there are no government officials at the border and formalities are at a minimum. A new flag is flying and a picture of Col Qadhafi has been cross out.

There are a series of checkpoints as you drive into Libya, which are armed by army and police officers, but they have all defected to the opposition. The BBC reports that locals are even acting as traffic police.

It is estimated that 1.5 million Egyptians were in Libya. An Egyptian security official told the Associated Press that about 5,000 Egyptians have returned home and about 10,000 more are waiting to cross the Libya-Egypt border.

A Korean news source has reported the story of nine Koreans working in Libya who drove for 67 hours through the desert on mostly unpaved roads to escape the country to Egypt. Their office in Tubruk had been looted over the weekend and a number of public buildings in the city were set on fire, they said.

Reports so far indicate that Qadhafi's forces have fared better on the Western border, and the plain green Libyan flag of his regime is still flying. Huge bottlenecks are reported at border crossings, although large numbers are getting through.

The International Organisation for Migration said on Wednesday 23rd February that thousands of foreign nationals were leaving by the western land border as well.

"Although a significant number are from Egypt, Tunisia, Sudan, Chad, Niger, West Africa and the Horn of Africa, there are also migrants from other parts of the world including Asia," it said. "Among them are Filipinos, Sri Lankans, Bangladeshis, Pakistanis and Chinese."

It also mentioned Lebanese, Turkish, Syrian and German nationals have left through the land border. IOM spokesman Jean-Philippe Chauzy said the arrivals began on late Tuesday.

Fleeing migrants said they had been stopped at checkpoints by pro-government soldiers who confiscated mobile phones, passports and other belongings, Chauzy said.

Many foreign ministries, including that of the UK, have started or will start evacuating their citizens from Libya by air and sea.

Sources: BBC, Reuters, Associated Press, JoongAng Daily

For more news and expert analysis about Libya, please see Libya Focus and Libya Politics & Security.