Global Policy Forum

Deep in The Republic Of Chevron


By Norimitsu Onishi

Sunday New York Times Magazine
July 4, 1999

The delta region of southern Nigeria, where the mighty Niger River drains into the Atlantic Ocean, includes some of the most inhospitable territory on earth. It's the world's largest mangrove swamp, 14,000 square miles of thickets, channels and lagoons all but impenetrable to any but the most practiced eye. It's also oil country, dotted with wells and flow stations, where about two million barrels of crude are collected each day and piped to central stations for transport abroad.

Helicopter is the preferred mode of transport, for the lucky few who can afford it. One of those is Leonard Hutto, the superintendent of Chevron's operations in the eastern Niger Delta, and on this day it was his chopper that hovered tentatively above one of Chevron's 30-odd oil stations in the area. The landing pad, a few hundred feet below, was thronged with hundreds of angry young Nigerians peering up at the midmorning sky, clearly shouting and shaking their fists. Seeing that they did not have guns, Hutto finally told the pilot to land.

At the same moment, down on the flow station, standing atop a table inside a tiny office, surrounded by dozens of young men brandishing machetes, Hutto's Nigerian assistant, Tony Okoaye, was relieved to hear the helicopter's engine drown out the shouts of his captors. To hear Okoaye tell it, a predawn phone call had jerked him out of bed: 400 villagers had invaded the site, carrying with them a long list of demands. By 7 A.M. Okoaye had driven to the station, only to be taken hostage. Okoaye, an American-educated engineer normally prone to fits of delirious laughter, was not laughing. The young men, many drunk or high on marijuana, made him stand on the table for hours, slapping his pudgy frame and jabbing forefingers into the soft belly above his Tommy Hilfiger jeans. "Ah, hah!" they taunted. "You're a big man!"

They ordered him to shut down the oil wells. Okoaye did so, reluctantly. "You don't want to lose one barrel." Then they demanded to see his boss, Hutto. "We want to see the white man," they told him. "The American." And so after a half-hour helicopter ride from Chevron's eastern headquarters in the city of Port Harcourt, the American oilman from south Texas had arrived. "What a pain," Hutto remembers thinking, as his chopper descended from the sky and the Nigerians scattered.

What came next on this particular morning would nonplus the most seasoned executive at a Fortune 500 company, but to the Chevron oilman it was Kabuki. After the youths agreed to let him call a police escort, Hutto got into a Toyota pickup and drove a few miles to the village. There, in the shade of a huge tree, he sat on a folding chair through the afternoon, listening to the community's grievances and demands: more scholarships for its youngsters and more regular meetings with Chevron, which the locals would get, and other demands, which they would not, including 25 jobs on the spot, about $27,000 in cash and an unspecified amount for the wages they had lost while busy invading the oil station. Hutto instead slipped $50 to the town chiefs for drinks, $20 to the youths and another $20 to a group of young men who had let the air out of the tires of the Toyota -- to reinflate them. His assistant was released, the valves were opened at the oil wells and crude began coursing through the pipelines to the flow station. A few thousand barrels had been lost.

"Not a big deal," Hutto says. Routine, in fact, in the Niger Delta, where men usually focused on finding and extracting hydrocarbons are forced to act as politicians, diplomats and mediators. These are roles that Western oilmen are increasingly playing as they seek crude in war-ravaged and lawless places like Angola and Congo, nations in name alone. Hutto spent 12 years in Congo, the former Zaire, where frequent crises forced him to sleep on an offshore oil platform, a fortress in the Atlantic Ocean several miles from a land of chaos.

The Niger Delta is not just physically inhospitable. It is also the most combustible oil-rich corner on the planet -- simply the most difficult and dangerous assignment for an oilman. In Hutto's office, a framed black-and-white photograph hangs on the wall, a constant reminder of the price of peacekeeping in the delta. It shows Hutto standing next to some chiefs in Kula at the dedication of a $125,000 town-hall center built by Chevron.

The photograph was taken a year ago, soon after Hutto arrived in Nigeria, just in time to see the death of Gen. Sani Abacha unleash a bewildering series of events that culminated in the installation of a new civilian Government in May. In the past year, the troubles in the Niger Delta have become more evident. Its boldest residents, whose anger had been contained by Abacha's fiercely repressive dictatorship, have invaded oil stations, kidnapped workers and committed sabotage against pipelines. Last fall, the unrest slashed Nigeria's daily oil production by a third. The revolt, deadlier, more widespread and better organized than the isolated protests of previous years, led many in Nigeria to talk of a coming civil war.

All of which has transformed the simple task of pumping crude into a strange exercise in diplomacy, civics and bluff, less the oil business than an exercise in velvet-gloved imperialism. "We've gone to a situation whereby we can produce oil with our eyes closed," says Okoaye, 42, who has worked in Port Harcourt for seven years. "Dealing with those guys, that's the toughest part now."

And so the Western oil companies find themselves in the peculiar position of providing services usually met by government -- supplying electricity and water, building roads, bridges, schools and hospitals. Mostly, they have done this to stop rising public discontent from making it impossible for them to pump oil.

"The Government is supposed to do something first," says Ajumogobia Wenike, 43, a fisherman living in a town, Kula, so deep in the mangrove swamp that he has never even visited Port Harcourt, although it's only about 50 miles away. "But if government doesn't, the companies should do two and three, because they benefit from the blessings of our soil. It's what God gave us that they are tapping."

The unrest is rooted in four decades of gross state neglect. Successive military regimes dominated by Muslim northerners have kept the Niger Delta and its seven million people severely undeveloped, while enforcing few, if any, environmental standards. The generals had already, in the late 1960's, fought the bloodiest civil war in post-colonial Africa. In that conflict, the Ibo, one of the three main ethnic groups in the country, had tried to secede, form their own country, Biafra, and take the oil with them. The generals feared that economic development in the delta would inevitably beget similar separatist yearnings.

"Our responsibility, our duty, our obligation is to redress the neglect of the past," the newly elected President, Olusegun Obasanjo, said during a visit this month to the delta. This was after a new wave of violence swept the area the day after his inauguration, leaving scores of Nigerians dead. "But please, please, give us the opportunity. Give us time." For now, while the roads in the rest of the country may be bad, they are virtually nonexistent here. While the state-owned power utility supplies infrequent electricity elsewhere, its power lines do not even reach here. Not only has little of the estimated $275 billion the country has earned from oil since the mid-1970's been spent here, but $50 billion of it has just disappeared overseas, according to a United States official in Nigeria.

There is only one major road in the delta -- a 120-mile stretch linking the oil cities of Port Harcourt and Warri. The road, with soldiers stationed every few miles to preserve order, provides sometimes grotesque scenes of misery. When a crater-size pothole forces me to stop my car, men and women wearing rags and straw hats surge forward and prostrate themselves on the road. The supplicants, my driver explains, are escapees from a local leper colony.

I am heading east to Port Harcourt, to meet Hutto at Chevron's offices in a walled-off compound of white one-story buildings. I find him standing under the canopy of the main entrance, dragging on a Marlboro and chatting with traditional leaders from the communities near Chevron's oil sites. The chiefs drop by one after the other, as they do every day Hutto is here. Overall, he says, he now spends at least 60 percent of his time on community relations.

Damian Obiagu, a chief in a town called Izombe, buttonholes Hutto: "Please, I have just dropped a letter for you. If they have been working on my land, I want them to employ -- I have dropped the letter in the office. So you have to tell them."

"Yeah, we'll talk," Hutto says. "Yes, thank you very much," the chief says, leaving. "Yes, thank you veeeeery much."

The chief's words may be disjointed, but his message is clear. A Chevron contractor has been doing some work at an oil well, and the chief is pressing Hutto to make the contractor hire local youths as casuals. In all likelihood, ghost workers will be hired. "They don't show up for work," Hutto explains. "You don't want them to. You don't want a person on a jack-up barge or drilling rig who doesn't know anything about safety."

But the ghost workers serve an important purpose. They allow the chief to claim he has won jobs for his people and the oil company to say it has hired from the community. The fiction is necessary because it is virtually impossible to find qualified oil workers among the delta residents. Sometimes, though, one party does not stick to his lines. Chevron awarded Obiagu a contract to provide "security" at one of the wells. But one day, displeased with Chevron, the chief's men invaded the well. "No, no, Damian, you don't understand," Hutto recalls telling the chief. "You're our security contractor, to protect us. You're not looking to threaten us. 'Oh! oh!' he said. He's a nice old man."

Since taking over Gulf Oil in 1984, Chevron has pumped many billions of dollars' worth of oil in Nigeria, 418,000 barrels a day in 1998. In 1998, Chevron Corporation's total worldwide revenues amounted to $30.6 billion; Nigeria's gross national product was estimated by the World Bank to be $30.7 billion in 1997. Nigeria's G.N.P., while a pittance alongside the West's economies, is one of Africa's biggest.

Kingdom Dateme, the king of a town called Idama, also finds Hutto under the canopy. "Our Government cannot assist us for anything," the king tells me. "So, in effect, we now make all our demands on Chevron. Your own state cannot do anything for you. Your local governments cannot provide something for you. We are now like father and son. Are you getting me? I can even come here at 6 o'clock, 8 P.M. or 8 A.M. I can simply come."

"You must help me, your people," Hutto tells him.

"I'm creating the enabling atmosphere for you," the king says.

In return, Chevron is building a science laboratory for the town's secondary school. But to insure the loyalty of the king and other traditional leaders, Chevron awards them personal contracts, to provide security or, more typically, to supply the office with bottled water and office materials. "It's better than to just give them money," Hutto says after the king has left. "I'd rather see them work for it."

The king has been pushing for a bigger personal contract, Hutto tells his assistant, Okoaye, who has come outside. "He wants a contract so that he can get a big house now," Hutto says.

"In his village?" Okoaye asks.

"No, here.'

"Here in P.H.?" Okoaye laughs, adding, "That guy, he's something else, eh?"

"He's looking for a half-million, million Naira contract," Hutto says, the equivalent of $5,000 to $10,000. "With those he can buy his own big house here."

Okoaye laughs uproariously, before adding with some finality, "He's a pig." Then softening up a bit, Okoaye asks his boss: "But he doesn't really make trouble for you. He doesn't really bother you, does he? He's just greedy."

"Well," Hutto says, "they're all greedy."

After work, Hutto drives home in his white Toyota Landcruiser through Port Harcourt's "go slows," or traffic jams. Boys hawking everything from toilet paper to power tools dart to his side with cries of "Master!" But they turn away quickly: a Nigerian policeman, gripping a tear-gas rifle in his hands, rides shotgun.

More policemen guard Hutto's villa, a two-story white house. Never married, Hutto lives alone, not counting the houseboy in the backyard bungalow. In the kitchen, Hutto shows me a large refrigerator and freezer. He keeps inside the 50 New York sirloin and T-bone steaks that he brought back from his last visit to the United States and has been cooking, at the rate of one a week, on a grill that he keeps in his living room.

He drops off his briefcase and gets ready for a visit to an expat bar called Cheers. As Hutto pulls out of his driveway, a skinny African dog watches indifferently. When he moved in, Hutto explains, the houseboy told him that the previous tenant had left the dog behind.

"Now it's yours," Hutto told the houseboy.

Hutto, 43, grew up in the small town of Taft in south Texas, watching his father and grandfather supplement their farmers' incomes by working in oil fields. Hutto got a degree in petroleum engineering at Texas A&M, then joined Chevron and worked in west Texas and the company's headquarters in San Francisco. But it was the Congo that hardened him for battle. Like many expatriate oilmen in Africa, he worked nonstop for 28 days, then went home for 28 days, in his case to a ranch-style house in Las Vegas.

"I was there to make money," Hutto says of the Congo, and explains one trick. During his trips home, he would go to a Kmart and buy cheap wristwatches on sale and sell them for a mark-up to the Congolese. "And these guys, they would just see the original price sticker," he says. "The same guys would come to me in three months for another watch, so I knew they were reselling them. I was just getting my cut."

A year ago, Hutto accepted the assignment in Port Harcourt, a position Chevron considers difficult to fill because there is no rotation schedule, no other Americans and constant interaction with Chevron's delta neighbors. In Lagos, the Americans live inside Chevron's headquarters, a sprawling campus surrounded by high walls, a surreal replica of America with wide streets and suburban houses straight out of Westchester County. Here, Hutto is alone.

And to the thousands in the delta, Leonard Hutto is Chevron Oil. For years, the oil companies ignored the squalid conditions in the delta, content to pump oil and get their profits out. But they were forced to change their approach, particularly after 1995. General Abacha's regime hanged the writer Ken Saro-Wiwa after he demanded reparations for his Ogoni people, who remained impoverished despite the long presence of Royal Dutch/Shell in their region. Nigeria became an international pariah; Shell, the biggest producer in the country, suffered a public-relations black eye. Shell began a review of its relations with its host communities, and the other companies increased their community contributions.

But violence has risen and taken on different forms. The deadliest has been fighting among the delta's ethnic groups, competing against one another for jobs or claims to oil-rich areas. The Nigerian military has also engaged in battles with rioters, and the oil companies have been criticized for their coziness with the military. A recent report by the New York-based Human Rights Watch says the oil companies have looked away whenever the military has brutalized or killed protesters. In Chevron's case, Human Rights Watch says that twice in the last year the military used Chevron boats and helicopters to crack down on protesters. Four villagers were killed in one incident, according to the organization.

Chevron, like the other oil companies, argues that its hands are tied in these situations. The companies are minority partners in joint ventures with the Government and say they cannot refuse any requests by the military to use equipment leased by the joint venture. What's more, the companies point out, their workers have often been hurt. In December, six of Chevron's Nigerian employees were kidnapped and are presumed dead.

For Hutto, keeping peace in the town of Kula has been especially hard. At Chevron's quarterly meeting in Kula, the number of chiefs invariably increases, which means more contracts to hand out and more money to spread around. "Most Kula people are greedy; most of the chiefs are greedy," Hutto says. "They want money all the time. Money, money, money, money."

But, he says, he will stick with this job, maybe for another two or three years. An overseas assignment has always been good for an oilman's career, but especially so nowadays when Chevron is increasing the number of its positions overseas. And he reckons that he makes about 50 percent more than an executive at an equal level in the United States.

After several Heinekens at Cheers, we go to Charlie's, a restaurant for well-to-do Nigerians. Hutto flirts with Phyllis, the waitress, but complains when she brings him only two prawns on a platter. The food has been going downhill since Sylvia left; Sylvia always brought him three prawns. It is not 10 P.M. yet, but it is time to go home. Early morning. Lots of work. And Kula, always Kula. "He always leaves early," the host says, "before the pretty girls come."

Unreachable by road, Kula lies on the Atlantic coast, a two- to three-hour trip aboard a twin-engine boat from Port Harcourt, through a maze of swampy creeks that appear indistinguishable from one another. There are two other ways to get there: a 30-minute flight aboard a helicopter, which the oil companies use, or a big, slow, aging boat that takes about nine hours and is used by most people here.

Not too far north of Kula, one Chevron and three Shell stations pump tens of thousands of barrels of oil a day. In the creeks around Kula, children paddle by themselves in dugout canoes, cruising past mangrove trees that dig their sinister-looking roots, spiderlike, into the soft shore. On the waterfront, a Government-built concrete jetty is sinking into the river, seemingly ready to collapse at any moment. A stone's throw from there, the blackened and rotting pillars of a new Government jetty that was never finished are slowly giving way to the waves. Kula consists of a town center surrounded by scores of fishing settlements of mud-and-thatch houses. In the center, simple wood houses with dirt or concrete floors and zinc roofs are packed around narrow dirt alleyways. Open sewers, reeking of stagnant green refuse, crisscross the area.

In other words, Kula is a typical delta town. The only medical facility for a population estimated at more than 40,000 is a three-bed dispensary in a squat concrete building constructed decades ago by the British, Nigeria's former colonial rulers. Its three primary schools and one secondary school have stood empty for the last four months, since the teachers, who had not been paid in months, went on strike. Electricity is provided by a generator that is maintained by Shell. It is turned on around 7 P.M. and switched off around 6 A.M. Chevron built the only paved road. At Kula's request, Chevron is now constructing staff quarters and dormitories for the secondary school, projects that were begun but abandoned by the Government in the early 1980's. Overall in Nigeria, Chevron reports spending $30 million from 1994 to 1998 in community-development projects.

The projects are agreed on during meetings between Chevron and the Kula chiefs. Because the Kula chiefs spend most of their time in Port Harcourt, the meetings are never actually conducted in Kula. And usually the meetings are held over catered lunches. "Free food!" Hutto says.

Typically, the Kula chiefs make requests of Chevron and, to keep the peace, the oil company agrees to them -- if the projects fall within budget. It does this even with projects that are patently unsound. For instance, Hutto says, Chevron warned against paving a road through a wet area, but the chiefs insisted. Now the road has collapsed. Another strategy to keep Kula and the other communities happy, Hutto says, is to drag out construction of projects, so that Chevron is almost always building something in each community, reaping the political rewards.

In Chief Anthony Opuari's house hangs the same photograph of the town-hall ribbon-cutting ceremony that hangs in Hutto's office. "Leonard Hutto is a kind man," says Opuari, who is Kula's senior chief. "He is always listening to our problems."

But away from the town center, next to a fishing bay in a cluster of shacks made of driftwood, the cozy relations between the oil companies and the chiefs kindle fires of resentment. "The chiefs punish us, combining with Shell and Chevron not to develop this town," says Dokubo Obene, 27, who is wearing a Michael Jordan T-shirt but says he has never heard of the basketball star. "When they want to develop this town, the chiefs collect the money as bribes." Obene belongs to a group that calls itself Chevron Youths. Its members, who squat on a piece of land across the river from the Chevron oil station, demanded a $2,000 "development" fee so that they could build a house.

Hutto has never heard of the Chevron Youths, though he does not doubt their existence. He knows that most residents of Kula say the oil companies have not done enough and accuse their leaders of selling them out. He admits that the Kula people are "probably right" that the chiefs are embezzling money. But the oil companies have no choice, he says, but to deal with leaders selected by the communities. "We can't start meddling with internal politics. You have to stay outside the boundaries of the community."

The chiefs routinely barge into Okoaye's office, greedily eying, for instance, the Chevron pen on his desk. "They take it!" Okoaye says, making a swiping movement with his arm. "Oh, I like it!' You try to be a nice guy, because those few things can count in the future. When you get into trouble, you want them to be there to help you."

Behind his cynicism, however, Okoaye conveys a passionate sense of mission. He is a Nigerian who chose to return home from the United States, not on a lucrative expat's salary but on the far-smaller wage of a local hire. Educated overseas, married at one time to an American woman and a member of the Yoruba, the most highly educated group among Nigeria's 110 million people, Okoaye is nearly as much a stranger as Hutto is to the people from the swamps and creeks. "Sometimes maybe the oil companies are too rigid," he says. "The oil companies should reach out to people in the villages, who genuinely live in the villages, maybe some religious leaders."

The chiefs maintain that by living in Port Harcourt they can lobby the oil companies more effectively. Besides, some of them work as civil servants there. When I first meet Opuari, he demands a "courtesy call" of 100,000 Naira, about $1,000, for an interview. He assures me the proceeds will be spread out among all the chiefs. The price drops gradually, all the way to $100, until he drops the subject altogether after half an hour.

"I asked Chevron for assistance to finish my house," Opuari says, referring to a concrete house he has been building in Kula. "But no assistance." The people of Kula wonder, though, how Opuari, a low-ranking civil servant with a secondary-school education, can afford a house in Port Harcourt, one in Kula and now a third one.

It is Saturday night in Kula. The town center sinks under a haze of smoke from countless small fires and the flicker of individual lamps. The brightest light in Kula, shining even brighter than the full moon on this night, is a Shell flow station's gas flare a few miles north. The flare lights up the sky with an orange tint, making the whiteness of the clouds eerily visible at midnight.

When I drop by unannounced at Kula's Anglican church on Sunday morning, a lay leader is delivering a sermon from the Acts of the Apostles. She reads the story of the couple, Ananias and Sapphira, who sell a piece of land and keep part of the proceeds for themselves. "But Peter said, 'Ananias, why has Satan filled your heart to lie to the Holy Spirit and to keep back part of the proceeds of the land?"'

In Kula, everyone believes his neighbors to be Ananias and Sapphira. The alienation from the community, from traditional authority, has made Kula a fertile ground for increasingly desperate actions, especially takeovers of oil stations. About a year ago, 25 youths were jailed after invading a Chevron oil rig. Shell, which has three stations and an extremely strained relationship with Kula, experienced an average of two shutdowns a month last year. Last month, 50 young men invaded a Shell station and closed it for five days, for a loss of 134,050 barrels of oil, worth about $2.4 million.

The takeovers are evidence that Kula's traditional social structure has collapsed, says Matthew Alabo, 40. A businessman born in Kula and one of the few to have been educated abroad, in London, Alabo returned last year to try to restore order in the largest fishing settlement in Kula. He has made some strides, helping depose a corrupt chief and organizing an election to select a successor.

The town's more successful men now jockey to be on the council of chiefs so that they can deal directly with the oil companies, Alabo says. While chiefs were once chosen for their wisdom, you can now buy a seat on the council for about $500, if one of your ancestors was a recognized chief; about $1,000 otherwise. Accordingly, the number of chiefs has risen from 5 to 18 in the last two years alone.

Young men mill around the oil operations, demanding that contractors pay a $100 "landing" or "youth" fee to pass through a certain creek, waiting for a spill to demand compensation or, Alabo says, causing sabotage. "Even if you are 12 years old, you don't want to stay behind and watch what others have come to give you," Alabo says. "Everyone wants his piece directly."

The same, naturally, can be said about all of Nigeria. If Nigeria is the story of Ananias and Sapphira told a thousand times, from its top military rulers all the way down to a chief in Kula, only the dollar amount needs adjustment.

On the boat back from Kula to Port Harcourt, a violent storm breaks suddenly. The bow, the mangrove trees, the creeks, the muddy river beds, the gas flares of the oil stations, all of the Niger Delta vanishes in the rain. Will President Obasanjo's pleas for time and another chance be heeded? Will he push through policies to reform the entrenched system of corruption and pay-offs? Or will the angriest people of the delta grow ever more angry? And will they be emboldened -- now that civilians, not soldiers, rule the country -- to create more disorder?

At Chevron's office in Port Harcourt, Hutto and Okoaye are standing outside under the canopy on a rainy morning. Hutto's voice is raspy, sore from several days of negotiating for the release of an American worker. The worker, "a big guy from Alabama," took his boat up a canal near Chevron's oil station in Kula to check on a well when half a dozen young men jumped him. The worker spent nine days in the mangrove swamp with his captors pointing guns at his head. After a $25,000 ransom is paid, the Alabama man is released.

"I don't know how we'll operate," Okoaye says, worried that such incidents will rise under the new civilian Government. "I don't know, because security is going to be a big problem."

Hutto rubs his forefinger and thumb together.

"Sometimes it doesn't go far enough, money alone," Okoaye says. "Yeah, spend more money?"

"Spend more money."

"Keep them quiet? Make them happy?"



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