The Angolan Oil Connection

[Chevron]    [Elf]    [Agip]    [BP]     [Norsk Hydra]     [Ranger Oil]     [Conoco]     [Texaco]     [Odebrecht]     [Citizens Energy]     [Exxon Mobil]     [Statoil]    [De Beers]

Tvind Alert has received detailed information about large sums of money being 'covertly' paid to ADPP (Tvind's southern African 'charity') by multinational oil companies.

The money is paid by oil multinationals working in Angola in 'Social Bonus Fund' payments to Sonangol, the Angolan state oil company, as a small part of oil prospecting and drilling concessions.    Sonangol passes it on to selected development agencies.

ADPP does extremely well out of this arrangement   -      proportionately much better than mainstream NGOs working in the same field.    Why?    There are strong indications that  ADPP is very close to the allegedly corrupt Angolan government. Basically, they make things very easy for Sonangol and do more or less what Sonangol wants, approaching them as a contractor rather than presenting their own programmes.

So who benefits?   The oil companies   -   yes.   And certainly Tvind.    But do the Angolan people benefit?

Several questions need to be answered.    Is all the money allocated to ADPP effectively used?      Is it properly accounted for?      Are the projects worthwhile?   Are other mainstream charities with better projects being denied funds?     And who runs the mysterious Chilean offshore fund used by Sonangol  -   Activa International   -  to receive these payments   -   does it have anything to do with the Teachers Group? 

The consultant's story

ADPP have a big operation in Angola  -  which is fast becoming a front-running petro-state.   Research into the funding of ADPP in Angola shows that ADPP has been successful in obtaining money from many oil companies.

Tvind Alert was contacted by a consultant to a major oil company, concerned about the indirect link between oil companies and ADPP.  He has chosen to remain anonymous.

He writes:  "The concerns over funding ADPP centre on the risk it poses to the oil company's reputation, particularly in Europe.

"One reason that oil companies consider that the risk is worth taking is because ADPP are believed to be well connected in Angola.  So perhaps some of the decisions made to fund ADPP were not thought through from the perspective of risk to public relations in our home countries, or on a professional appraisal of their ability to deliver services to Angolans, but rather on the basis of their apparent standing with the state oil company."

Interestingly, ADPP may indeed be well-connected in Angola.   A look at the website of the Angolan president's fund Fundao Eduardo dos Santos, (FESA)  (www.fesa.og.ao) shows that ADPP s country representative, Rikke Viholm, has a permanent place on the board alongside the Chief Executive of the state oil company, Sonangol.

FESA itself is widely criticised by observers and the independent press in Angola as a vote-buying apparatus for the President.   (ref: Messiant, C (1999) A Fundacao Eduardo dos Santos (FESA): A proposito de investida do poder Angolano sobre a sociedade civil In Politique Africaine V733 82-102).

The Humana website shows that ADPP claims to do three main things in Angola: teacher training, primary health care and income generating activities.

In addition, research into ADPP has revealed a complex mass of offshore banks and holding companies.   (Ref: Forum Syd report into ADPP Angola in "official reports" section of Tvind Alert). (Note:  this report will soon be available in PDF format)

In a recent article, Africa Confidential, a highly-respected journal of African political affairs stated: 

Government officials unofficially promise to spend at least US$16 million of new oil money on social projects. This may be a first tangible sign of the state oil company Sonangol's Social Bonus Fund, worth many tens of millions of dollars supposedly earmarked for social spending. The Fund benefits from secretive flows of money from oil companies; they have almost lost control of it and it risks becoming another vehicle for credit to the Angolan elite. Some oil companies have also given money to a non-governmental organisation called ADPP, which runs orphanages and other social projects in Angola. ADPP is part of a cult-like empire called Tvind, overseen by a reclusive Dane called Mogens Amdi Petersen. Chevron, in partnership with Elf and Agip, plus BP, has earmarked millions of dollars for ADPP, which calls Norsk Hydra, Ranger Oil, Conoco and Texaco project partners and whose website lists BP, De Beers, Elf, Odebrecht and Texaco as members of its general assembly... ".    Africa Confidential Vol 41.18.  Complete article

Oil companies make two kinds of payments to NGOs in Angola.   A company may make a grant of funding directly and unilaterally, and a few have funded ADPP in this way (though this direct funding is dwindling as concerns about the performance and image of ADPP become better known).  Foreign companies may also provide funding indirectly via the state oil company Sonangol through social bonus fund payments.  

ADPP were one of the first foreign NGOs to establish a presence in Angola as controls over NGOs were dropped when the socialist regime crumbled following the fall of the Soviet Union.  Unlike the mainstream NGOs, and in typical Tvind fashion, ADPP have adopted an unusual approach to fund raising: they have cultivated close relations with the state oil company and the Presidency.

An analysis of the ADPP Annual Report for 1998 shows some interesting budgeting:

From a total 1998 budget of $8.1m, ADPP received over half of their income (about $4.6m) from clothes sales and over $1.1m directly from the oil industry, namely the Cabinda Association (primarily Chevron but also Elf and Agip).     Block 18 social bonus funds (Sonangol, BP-Amoco and Shell ) were paid via Sonangol.

Other declared donors included Humana and the UN.    Unusually for a foreign NGO, ADPP also received funding from the Provincial Governments of Cabinda ($674,000) and Benguela.

A substantial sum ($676,000) was allocated to Humana Service Fees (Why?) or to Contribution to the construction of the Humana HQ in Zimbabwe.

It is not unusual for the local office of an international NGO to pay a service fee to head office for support services and administration.  But this seems a large sum.

In December1999, the UK-based watchdog NGO Global Witness (www.oneworld.org/globalwitness/). produced a report A Crude Awakening: the role of the oil and banking industries in Angolas Civil war and the plunder of State Assets which described how oil companies make payments to the Government of Angola.    Payments made via Sonangol are made as fixed or voluntary contributions to the Social Bonus Fund - a development fund primarily held and managed by Sonangol. Nobody knows exactly how much this fund is worth but Angolan media reports put it around $200m.

Some of the funds held in the Social Bonus Fund are disbursed by a board in Sonangol, and some are fed directly into Government programmes in the provinces.

Transparency and corruption are major issues in Angola.  Tony Hodges, author of Angola: From Afro-Stalinism to Petro-Diamond Capitalism. (James Currey, 2001) points to a bermuda-triangle of opaque financial dealings between the Presidency, the state oil company and the national bank of Angola.

The key corruption monitoring organization, Transparency International, ranked Angola 85^th out of 90 countries in the 2000 Corruption Perceptions Index,  ref http://www.gwdg.de/~uwvw/

The consultant concludes: "Independent internal audits for oil companies show that ADPP proposals are not developed along internationally-accepted norms.    In particular, they highlight the lack of adequate monitoring and financial management.   The blame lies in both camps."

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The De Beers connection (under construction)

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Angola/oil contacts:

A commentator writes:    "If you could check also the so-called "British Angola Forum" (BAF), based in London, which main sponsor is BP Amoco.    Even the British Defence Ministry (?) is member of this organization "BAF": its homepage www.riia.org/baf I hope that this information could help you to keep the international public opinion aware about the connections between some Western NGOs and Oil Multinationals which are fueling the war in Angola.   Best regards,
Angolan Anti-Militarism Initiative for Human Rights.
Iniciativa Angolana Antimilitarista para os Direitos Humanos (IAADH) www.snafu.de/~usp/iaadh.htm

British Angola Forum      http://www.riia.org/baf/