TAKEAWAY: Chevron wrote a new community development playbook in one of the world’s most troubled regions. The new model, which encourages and rewards compromise, is off to a promising start.
The Niger Delta region along Nigeria’s southwest coastline is one of the world’s most productive superfields. It offers 2 million barrels of petroleum a day and has more than 30 billion barrels of proven reserves. For more than a century, Chevron has been a part of Nigeria through its petroleum products division and since the ’60s, the company has operated in the Niger Delta, investing in oil recovery and production facilities, and in the people and communities of the region.
About the size of Pennsylvania, the Niger Delta spans nine of Nigeria’s 36 states, with 31 million people and more than 40 ethnic groups. Seven out of 10 people in the region live in poverty. Like many in Nigeria, those in the Niger Delta have endured serious conflicts among rival ethnic groups, including outbreaks of armed attacks.
In 2005, tensions in the Niger Delta reached a boiling point, with violent clashes between rival factions and direct action against Chevron and other oil companies. The tensions subsided and from it came a new way for energy companies to engage community leaders and collaborate with the people of Nigeria.
Chevron leveraged this opportunity by offering a pioneering concept with a decidedly unglamorous name: the Global Memorandum of Understanding, or GMoU. It was a new type of public-private partnership that switched the center of investment decision-making to the local communities. Through the GMoU, elected representatives from the communities of the Niger Delta would come together to discuss and decide priorities for development funds provided by Chevron. All would have a say in how and where community investment would proceed. All would share in Chevron’s ability to meet its operational, financial and corporate social responsibility goals.
“Turning over control of decisions on how to use community funding and having the community execute the projects had never been tried,” said Brikinn Esimaje, who is responsible for Chevron’s public affairs in Nigeria. “Before the GMoU, Chevron-funded projects were designed, planned, contracted for and built by us.”
Getting communities onboard the GMoU was an uphill fight. There were deep-seated rivalries and ongoing disputes among dozens of the groups to be represented. Some groups had taken up arms against others.
Despite these obstacles, Chevron and regional leaders brought together 95 Niger Delta communities of different sizes. Many of these communities spoke their own languages, and most of them had competed with each other over land ownership, compensation from land acquisition projects, and development resources from both the oil industry and the government.
Chevron forged partnerships with local NGOs and with Nigeria’s state and federal governments. The breakthrough was the formation of five Regional Development Committees, composed of elected representatives from the 95 local communities. These committees were charged with overseeing how projects were determined, prioritized, funded and executed. Representatives negotiated with each other and offered compromises to get projects built and operational. Everyone was at the table, and all sides had to give and take to reach consensus.
When the basic rules of development were agreed upon, the GMoU was signed by the communities. It established guiding principles of partnership, transparency, accountability, and project monitoring and evaluation. While the GMoU wasn’t legally binding, it was held by all to be “in force” in terms of commitments, responsibilities and rights. Through the GMoU, Chevron-funded Niger River projects are designed to deliver the biggest punch in the areas of greatest need, and include hospitals, housing, clean water sources, and investment in education.
Trust came slowly but it built with each project’s completion. Today, the GMoU is credited with helping to bring a sense of stability in the areas where Chevron operates, and since its founding, the company has supported roughly 680 projects that have benefitted more than 600,000 people. Joel Bisina of LITE-Africa, a Nigeria-based NGO, says “the model has brought relative peace to Chevron’s areas of operation, though more still needs to be done.”
Over time, Chevron recognized that the GMoU programs needed a regional strategy. That’s why in 2010, Chevron launched the Niger Delta Partnership Initiative (NDPI) and its Nigeria-based implementing partner, the Foundation for Partnership Initiatives in the Niger Delta (PIND). Both NDPI and PIND work to support Chevron’s operations in the Niger Delta by addressing regional issues related to conflict and poverty, and by focusing on supporting equitable economic growth.
The GMoU has been durable. In 2016, militant groups vandalized segments of Chevron’s pipelines and other assets in the Niger River Delta. Many community leaders and Regional Development Committee members stood up and spoke out against the violence.
Trust begets success, success begets more trust, and perhaps ignites a virtuous cycle that can lead to even greater accomplishment. In 2015, Chevron formed GMoU+, a program to bring what was learned in the Niger Delta to other parts of the world.