This article was first published in Platform’s Carbon Web newsletter, issue 11.
Despite relying on government funds and insurance for survival, RBS is still pumping millions into oil extraction in conflict zones.
In March 2009, RBS was part of a consortium of 14 banks that lent $1,890 million to the Irish company Tullow Oil – providing in the region of $100 million itself. The bank had already helped raise £402 million by placing shares for Tullow in January.
Tullow’s expansion plans are exacerbating conflict in Central Africa and South Asia. In early 2009, the company announced a major discovery of 400-1000 million barrels by Lake Albert in Uganda, just on the border with the Democratic Republic of Congo (DRC). Tullow also holds oil exploration rights across the border in North Kivu in the DRC, which continues to be torn by strife after more than a decade of resource-driven civil war. The border area has seen some of the fiercest fighting take place as rival armies and militias have struggled for control. An additional 30,000 refugees were displaced in North Kivu during two weeks of fighting in March, adding to the existing 1.4 million internally displaced people in the region.
Recent militia attacks appear to be a response to joint operations between the Congolese and Ugandan armies within Congo. In early March Presidents Museveni of Uganda and Kabila of DRC signed an agreement to continue military co-operation and to work together in exploiting oil discovered by Lake Albert. This marks a change from 2008, when Congo revoked Tullow’s exploration rights, accusing the company of enlisting the Ugandan army in violating its borders. Despite the shifting alliances, attempts to control oil and natural resources continue to drive military conflict in Eastern Congo.
Tullow also owns a significant stake in offshore oilfields on the Bangladeshi-Burmese border, which have led to recent naval escalation over maritime boundaries. The company has further been criticised for re-using single-hull tankers (which are widely phased out under environmental safety regulations) as floating production and storage vessels in its Ghana offshore operations.