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Oil giants ordered to leave Chad

Sun., Aug. 27, 2006

N’DJAMENA, Chad – Chad’s president on Saturday ordered oil companies Chevron Corp. and Petronas to leave the country, saying neither has paid taxes and his country will take responsibility for the oil fields they have overseen.

In remarks on state-run radio, President Idriss Deby gave the companies – part of the African country’s oil production consortium that is led by Exxon Mobil Corp. – a deadline of just 24 hours to start making plans to leave.

“Chad has decided that as of tomorrow (Sunday), Chevron and Petronas must leave Chad because they have refused to pay their taxes,” Deby said in a message broadcast on state-run radio.

Deby said Chad, which is one of Africa’s newest oil producers and is setting up a national oil company, would take over the oil fields that have been overseen by the American and Malaysian companies and account for some 60 percent of its oil production.

Sabri Syed, a spokesman for Kuala Lumpur-based Petroliam Nasional Berhad, said he could not comment on Deby’s announcement.

Chevron said in a statement it had not been behind on any tax payments and had not been told it must leave Chad.

“Chevron has not received any official notification from the Republic of Chad government asking Chevron to leave the country over tax issues,” the statement said. “However, Chevron has been in full compliance with all of our tax obligations.”

Mark D. Boudreaux, a spokesman for ExxonMobil, told the Associated Press by e-mail that neither his company nor affiliate Esso Chad has been asked to leave the country.

If the two companies are evicted, Chad could seek help from China, which has taken an active interest in Africa in its search for raw materials like oil and metals.

Earlier this year, Chad broke off diplomatic relations with Taiwan and turned instead to China, a move that could help it sell its oil to the energy-hungry power.

China is already the largest exporter of oil from Angola and it also exports oil from Sudan.

The production and export of petroleum in Chad are overseen by the ExxonMobil-led consortium. Under the mechanism, Texas-based ExxonMobil is responsible for 40 percent of the country’s production, while Chevron and Petronas each have 30 percent.

The three companies agreed to finance a risky $4.2 billion, 659- mile pipeline to deliver oil from landlocked Chad to the Atlantic port of Kribi in Cameroon.

The companies agreed to invest the money after the World Bank gave the project its blessing and after Chad passed a World Bank-backed oil revenues law that required most of the money to be allocated to health, education and infrastructure projects.


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