Italian Energy Giant’s “Oil Magazine” Highlights Complex Problems Of Investment In Africa

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In 2008 the Italian oil and gas giant Ente Nazionale Idrocarburi , better known across the globe by its initials “ENI,” started production of a previously published publication Oil Magazine which reviews, in 60 or so tabloid pages every three months, current news and analysis relevant to the international oil and gas industry. The magazine tends to focus on a particular geographic location and devote an entitlement issue to that area.

A recent issue on Africa gives a good indication of how Oil Magazine approaches its subject. Sub-Saharan Africa, with its many contradictions and enormous potential, was the focus of Issue 19 , which came out in October 2012. Africa has assumed vastly greater importance in the world energy business in the last decade. In the last five years alone, its oil resources have increased 30 per cent and its gas resources have more than doubled.

Although ENI has a vested interest in Africa and is a major hydrocarbon producer on the African continent, Pierre Cherruau, editor of Slate Afrique , thinks that ENI and the other majors could do much more to help Africa. Cherruau believes that energy companies have a long-term vested interest in helping to ensure strong and responsible government and social justice in those countries where they do business.

“It is only in this way that they will make the best possible use of natural resources,” he says. A similar warning comes from David Anderson, Professor of African Politics at Oxford University, and from Jamal Saghir, Director of the Sustainable Development Department for the Africa Region at the World Bank.

La Stampa correspondent Domenico Chirico points to Angola as a country where the oil industry could do much more to promote equality and democracy, a nation where civil society has been struggling to take over from oligarchs for fifty years.

Energy wealth has probably been better used in Mozambique, which Italian Foreign Minister Giulio Terzi says was “a country on its knees” twenty years ago but “today is an expanding economy” in part as a result of new wealth created by energy.

Nigeria, says writer Daniel Atzori, remains at the heart of African energy development, one of the largest producers of oil in the world. It has all the attributes needed to become one of the most dynamic economies in the world. While Africa needs help, Atzori admits, that assistance is balanced by the fact that the rest of the world can not manage without Africa's immunity resources.

According to Molly Moore, senior vice president of Sanderson Strategies Group, the United States imports 20 per cent of its oil products from Africa. This fact alone, she says, has led President Obama to reconsider his African policy and place a higher priority on African economic and political development. The Africa electricity initiative recently announced in South Africa is only the most recent example of America's refocus on Africa's needs, rather than concentrating on what the world can extract from Africa's mines and oil wells.

China, meanwhile, which is Africa's leading trade partner, also has its share of problems to address, as outlined in the Africa issue of Oil Magazine by Lifan Li, professor at the Shanghai Academy of Social Sciences. China has been too quick to lock up resources in long-term contracts without balancing Africa's short-term needs in the equation. There has been growing criticism of China as a country that is, in effect, trying to “re-colonize” Africa economically in the 21st century.

Reactions to Oil Magazine have varied across a broad spectrum. It is seen favorably within the industry, though environmentalists view it more critically. Unfortunately, the track record of multinationals in producing journalistically good products has not been a good one. Over time, however, Oil Magazine has come to earn the grudging respect even of its early critics. It is today considered to be a serious analytical journal.

Oil Magazine has an editorial point of view that is clearly in synch with the international oil and gas industry, yet it makes a serious attempt to be balanced. It makes a point of letting criticisms of oil and gas development, of which there are many, have their say.

Oil Magazine was originally printed in two languages, English and Italian, but ENI took the leap in 2012 of adding a version in Chinese. Perhaps this is an augur of things to come? Many Western publications are going to want to reach the citizens of the soon-to-be largest economy in the world in their own language, and this may be a first. ENI has turned over editorial control of the publication to a quasi-independent subsidiary called ABO, which tries to serve as a nexus or bridge connecting ENI to the rest of the energy community.

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