“Congo May Have Fabricated an Oil Find to Leverage Foreign Aid”, Der Spiegel

The precarious financial situation is also a function of the president’s own malfeasance. Denis Sassou-Nguesso is considered a notorious kleptocrat, with corruption and maladministration having spiked under his leadership. Last summer, the tiny country of San Marino seized 19 million euros from private accounts belonging to the president on suspicions of money laundering.

The president’s family maintains close ties with the head of the company that announced the alleged oil discovery, a man named Claude Wilfrid Etoka. According to files from a French investigation, Etoka benefits handsomely from his dealings with Congo’s state oil company.

The story of the alleged oil discovery is illustrative of the dark side of development aid. Poor countries are often similar to addicts waiting for their next injection and will do almost anything to get their hands on even more money. All too frequently, the money doesn’t end up helping the population, instead improving the offshore accounts of the ruling class, as a World Bank study recently suggested.

Nevertheless, industrialized countries continue to send over millions in aid, particularly when it comes to climate protection measures. Last September, the German government announced that it would be increasing its funding for rain forest protection by 250 million euros. German Chancellor Angela Merkel said on the sidelines of the UN Climate Action Summit in New York that “it is very important that, with regard to the preservation of rain forests, we also focus all our efforts in Africa. The preservation of rain forests in Africa is as important as it is in the Amazon region.” She may be right, but it is questionable whether the money always ends up where it is supposed to – as the example of the Republic of Congo illustrates.

The country should not be confused with the Democratic Republic of Congo, Congo’s large neighbor across the river of the same name. The smaller Congo is the largest crude oil producer of the Economic Community of Central African States, known as CEMAC. Until 2014, the country profited from high oil prices on the global market. But the plunge in prices since then has presented significant problems for the government of the former French colony. The salaries of civil servants, for example, could no longer be paid in a timely manner.

A Shopping Spree in Paris and Dubai

Denis Sassou-Nguesso, 76, has governed Congo with just a single interruption since 1979 and his weakness for status symbols is legendary. On one occasion, he is said to have spent 114,000 euros on a pair of crocodile-leather shoes. His son, Denis-Christel, who goes by the nickname “Kiki the Oil Man,” spent tens of thousands of euros, likely from state oil revenues, on shopping sprees in Paris and Dubai, according to Global Witness.

Yet whereas the president’s family lives in luxury, the population suffers from poverty and mass unemployment. In Brazzaville, there are just a handful of high-rises jutting out from the surrounding slums. One of them is the headquarters of the state oil company SNPC – two offset half circles of glass and stone, with carefully mown grass out front. This is where the country’s most important source of power is managed. The president’s son Kiki was deputy head of the company until 2018.

SNPC was also responsible for awarding drilling rights in the Ngoki Block, the site of the alleged oil discovery. Ngoki means “crocodile” in the local language of Lingala. The drilling area lies deep in the rain forests of northern Congo, an area that had previously been spared by the oil industry.

In 2006, SNPC reached an agreement with an Arab businessman on the exploitation of the Ngoki Block, but the project became too much for the man and he soon began searching for investors to help him develop the site.

Internal documents show that the oil companies Shell and Total indicated their interest. They examined the results of seismic tests and also made their own calculations. Ultimately, though, all potential investors declined to participate.

The French oil company Total was concerned about “high cost of drilling” and the “difficult access” to the remote area. In the minutes of one conversation from July 2015, it is noted that “leads in the block are too small to be attractive drill targets.” The British-Dutch company Shell reached the same conclusion, explaining in January 2016 that it had decided against investing in the site “based on the combination of high risk and modest size of the identified leads.”

The experts involved even expressed doubts as to whether there was any oil at all in the Ngoki Block. According to the documents, the reserves likely originated in the Paleozoic, more than 400 million years ago. The “principle risk” was that the reservoir had long since drained naturally.

One man, though, was not to be dissuaded: The Congolese businessman Wilfrid Etoka, 50, the richest man in the country with an estimated net worth of half a billion dollars. He initially made a 30 percent investment before pushing out the Arabs and becoming the sole head of Pepa, the company that had obtained a drilling allowance in the Ngoki Block.

Etoka has made a significant portion of his wealth in deals with state-owned companies, including the national oil company SNPC. It likely doesn’t hurt that Etoki is a member of the Mbochi people, to which President Sassou-Nguesso also belongs. Their homeland isn’t far from the Nboki Block. According to Global Witness, one of the president’s nephews was appointed director general of the oil company Pepa, which Etoka did not deny when contacted.

Suspicious Activity

Etoka’s ties to the president’s clan also got the attention of French investigators. They are looking into Sassou-Nguesso on suspicions of corruption, embezzlement of state funds and money laundering.

During a search of a car dealership in Paris in 2012, police discovered that Etoka – apparently using the fictitious name of Pierre Etoka – bought two Land Rovers at a combined cost of 148,000 euros. They believe that the SUVs were acquired “on behalf of the Sassou-Nguesso family and their relatives.” Etoka denies the accusation, claiming that he had purchased the cars for himself.

One-and-a-half years ago, investigators then seized documents at the bank BNP Paribas that hint at further suspicious activity. BNP had provided loans to companies belonging to Etoka in the past, but the bank had broken off business ties to Etoka due to his “close friend relationship with the wife of the president of Congo.” In addition, profits from Etoka’s deals with the state-owned SNPC were too high, the bank noted. Etoka, for his part, claims that BNP closed his accounts due to U.S. sanctions against the bank.

The links between Etoka and the Sassou-Nguesso family likely explain why the businessman invested in the Ngoki Block. One former high-ranking member of government referred to Etoka in comments to DER SPIEGEL as the president’s “straw man.”

Perhaps the two really did believe that the Ngoki Block could produce significant amounts of oil. More likely, though, is that they recognized the area’s true value – as home to the world’s second-largest rain forest, the preservation of which was worth a significant amount of money to wealthier countries.

In 2015, the European Union, Germany, Norway, France and Britain joined six African countries in founding the Central African Forest Initiative with the goal of supporting efforts to preserve the rain forest. The initiative provides money to recipient countries in return for putting a stop to logging activities, for example. The 60 million euros that President Macron promised last year are also to run through the Central African Forest Initiative.

The countries redoubled their efforts when scientists a few years ago surveyed the peat bogs in the Congo Basin and determined that around 30 billion tons of carbon is stored there. That was likely the moment that Sassou-Nguesso and Etoka realized the treasure they held in their hands. The Ngoki Block lies at the edge of the sensitive ecosystem.

The president suddenly began presenting himself as a climate protector and in 2017, he established an environmental fund, called “Fonds Bleu,” to protect the Congo Basin. It was to be the collection point for funds provided from other countries. Germany participated in the establishment of the fund, according to the minutes of a preparatory meeting. According to the Environment Ministry in Berlin, the German federal government provided 550,000 euros.

The former high-ranking member of the Congolese government told DER SPIEGEL that Sassou-Nguesso founded the environmental fund “to take the money for himself.” He said that the fund targeted wealthy countries with high environmental awareness, with the Ngoki Block serving the purpose of ratcheting up the pressure on Europe. The message, according to the former member of government, was clear: “If you don’t give us money, we’ll destroy the jungle.” He continued: “They’re bandits.”

Congo’s Energy Independence?

In 2018, Etoka signed a contract with the French company SMP Drilling for exploration work and a drilling rig was set up in the Ngoki Block, as video footage from the project’s website shows. The company’s legal affairs director, Christian Cottenceau, told Mediapart that Etoka had promised to obtain the necessary funds with help from the president.

Cottenceau says the first drill test began in March 2019 under extremely difficult circumstances. The workers, he said, had nothing to eat for an extended period and were unable to find lodging in the area. As such, the drilling was delayed by several months.

When the drilling license expired on May 31, 2019, work was still underway, but that proved to be but a small hurdle. On July 26, President Sassou-Nguesso issued a retroactive decree providing for the “exceptional” extension of the license for one year.