2006 is the year: Sri Lanka, LTTE and the oil alliance

In this year, the IV Eelam War broke out. After the attempt of the Peace Talks from 2001 to 2005, both parties strove to resume hostilities. Many reasons have been added for the failure of the peace process. For the LTTE and especially its leader, Prabhakaran, the agreement was to far away from full independence. Of course that target was impossible to reach through negotiations, therefore only the military way was open for that purpose. On the other side the Sri Lankan government had promised even too much in the eyes of its more nationalistic constituency. Therefore in 2006 everybody was keen to start again the war.

Erik Solheim and Velupillai Prabhakaran
Photo nation.lk

The biggest loser was Norway. The Nordic country in fact dedicated a lot of efforts to find a deal. If you consider that from 2001 TGS-Nopec, a company specialized in seismic survey for oil exploration, was showing enthusiastic reports about the possibility to find petroleum reserves, you may guess that the government in Oslo had some undisclosed interests. If you add that the special envoy, Mr Erik Solheim, just on the brink of the Peace Talks ending was nominated Minister for International Development¹, with specific interest in the oil sector, for the Norwegian initiative “Oil for development”,Norad², (see Solheim’s activity in Ghana³, Sudan⁴, Angola⁵).

 But Norway is not the only country in the world searching for opportunities in the oil sector. China and India in the same period were involved in a tough race to secure contracts for natural resources

Union Petroleum Minister Mani Shankar Aiyar with the President of China National Petroleum Corporation, Chen Geng in Beijing on January 13.

around the world. The competition was so strong, that their bidding war was driving prices up everywhere. Thus the two Asian giants decided to form an alliance. “The agreement aimed at preventing the two nations competition for oil assets pushing up prices, symbolises their increasingly assertive role in global energy politics” (source: Financial Time).⁶

 One of the first country to test this alliance, was precisely Sri Lanka. President Rajapaksa, soon after he received information about the possible presence of oil in the Mannar Basin, decided to get rid of Norway and offered India and China one block each ⁷⁸.

We are far from saying that the Peace Talks were interrupted for the oil discovery; we are also not affirming that the IV Eelam War was oil-driven and that the India and China support of Sri Lanka was motivated purely by the natural resource deal.

We can see a series of coincidences and we argue that oil played a role in Sri Lanka, maybe only a secondary one, but not completely marginal. Norway is our first indicator; the Nordic country didn’t though it could provide more transparency on its conduct, but had clearly a vested interest in the peace process in relation to the oil reserve. China and India had additional reasons to back

Anti-lankan protest led by politician and activist Vaiko in Tamil Nadu.
Photo onlanka.com

Colombo, but it was a clever and opportune gift from Rajapaksa to offer natural resources in exchange of their help. In particular it could have represent the convincing point for New Delhi, to intervene without hesitation. India has oil operations on its side of the Strait, and the idea of leaving oil reserve in the hands of the LTTE or China alone could have been the decisive argument to make move. The energy sector is more vital and strategic for India that any other alliance of convenience between China and Sri Lanka.

If you think that oil doesn’t play any role in conflicts around the globe, then you can ignore our thesis. On the other hand, if you assume that natural resources are too important in contemporary geopolitical scenarios, and so are always involved, maybe to different extent, you may be tempted to spend more time on this hypothesis.

 

 

1http://www.regjeringen.no/en/the-government/previous-governments/the-structure-of-the-registry/governments/modern-times/governments-since-1945/jens-stoltenbergs-second-government.html?id=449424

2 http://www.norad.no/en/about-norad

3http://www.dailyguideghana.com/?p=14300

4http://www.norway-sudan.org/News_and_events/Development-Cooperation/Minister-Erik-Solheim-leaves-office-/

5http://www.chathamhouse.org/media/comment/view/179785

6http://www.ft.com/intl/cms/s/0/25b30866-83a4-11da-9017-0000779e2340.html#axzz2GKs3EEjO

7http://articles.timesofindia.indiatimes.com/2007-12-21/international-business/27952014_1_exploration-blocks-oil-and-gas-cauvery-basin

8http://www.sundaytimes.lk/090920/FinancialTimes/ft08.html

The Trajectory of Norwegian peace-building:Sri Lanka, LTTE and the job experience of Mr. Solheim

LTTE chief negotiator S. P. Tamilselvan,Sri Lanka Government chief representative Minister Nimal Siripala de Silva and Norway’s International Development Minister Erik Solheim.
Photo/AsianTribune

In 2001 Norway brokered a truce between the Sri Lankan government and the separatist army of LTTE. The mission of the Nordic country is to negotiate with the parties. In an interview with BBC, the Norwegian envoy Mr Solheim justified the efforts of his country out of pure compassion: “Security policy for the 21^st century: if you want a peaceful Norway, you need a peaceful world.” A a safer place for our children.¹

Praiseworthy.

It is our evil nature to investigate the good deeds and we discover a coincidence: the very same year a Norwegian company, TGS-Nopec started seismic survey in the Mannar Basin in search of oil. From 2001 to 2006, the company amassed very promising data. The press release are nothing less than enthusiastic.

LTTE’s leader Prabhakaran with Norway’s envoy Mr Solheim.
Photo/Tamilnet

We don’t want to draw unnecessary conclusions. In scientific thinking you need to be very careful of two facts happening in the same time. Imposing causality or correlation could be in the eyes of the beholder. We see a strong effort by Norway to support the independence claim of a group of rebels. It is important to distinguish between LTTE and Tamil nationalism. The legitimacy of Tamil independence is not the subject. The debate concerns the fairness of giving such support to an organization that committed many heinous crimes. The Sri Lankan state is equally responsible of atrocities, with aggravating circumstances of being a governmental entity. The point is that Norway made a bold decision.

At the same time it is important to recall that Norway is a powerhouse in offshore drilling, with a first class expertise in the field. The Mannar Basin in Sri Lanka presents matchable conditions.

The peace process run in parallel with the oil exploration. And when the peace talks collapsed, so did the survey campaign.

Erik Solheim with workers of the oil sector

Erik Solheim, the man sent by Norway to negotiate the peace, was first a special envoy. In 2005 he was promoted Minister for International Development, with responsibility of leading the Oil for Development program, Norad². In this job he visited Ghana³ Sudan⁴, Angola⁵ with the clear purpose of consulting, advising, lobbying the oil sector for Norway. The Norwegian model of development is one of the most advanced, ethical and sustainable, so they are giving recommendations from a fair perspective. Yet, they are advising also on their own interest, to promote the Norwegian oil industry. This is the game of a governmental organization and it is neither good, nor bad. If your actions will cause harm, it will be negative. Positive otherwise.

Anti-Norway protest in Colombo.
Photo AP

The only anomaly in this series is the role of Sri Lanka: the Norwegian envoy is clearly working with an agenda driven by oil. But in Sri Lanka they allegedly acted as mere neutral observers with a only humanitarian purpose. I’m sure that Norway is advocating transparency and good practices in all the countries it is visiting in its oil for development programme. Therefore I’m sure that they welcome this insight about this activity,they forget to mention. An accidental omission. I consider this quite important for two reasons. First: was the role of Norway dispassionate? Were they working to bring peace amongst Sinhalese and Tamils or their priority was to get their hands on the oil? Their strategy to support the Tamil separatism was for the good of the Tamils or just to have a privileged partnership with a newly created state, which owned everything to them?

The second is that oil is a factor in Sri Lanka. Maybe it is only a secondary one. Yet nobody is discussing it. In the case of Norway, oil probably played a big part. Then it is our duty to investigate more about the connection of oil in the Mannar Basin with the IV Eelam War. Follow us and remember: you heard here for the first time.

1http://www.youtube.com/watch?v=q-nkX22BQ20

2http://www.norad.no/en/about-norad

3http://www.dailyguideghana.com/?p=14300

4http://www.norway-sudan.org/News_and_events/Development-Cooperation/Minister-Erik-Solheim-leaves-office-/

5http://www.chathamhouse.org/media/comment/view/179785

Oil, Tigers and Sri Lanka: what everybody knew but never said

Oil presence in Sri Lanka

In Sri Lanka there is oil. And it was an old and very well known fact. Petroleum exploration began in the ’60’s and after that especially the Soviets undertook several geological surveys from 1972 to 1975. After that a Canadian company acquired seismic data in 1984.

Then the war broke out, leaving everything dormant(source: the Minister of Petroleum Resource Development Secretariat, PRDS)¹.

In fact the areas interested are offshore the coast controlled by the LTTE; moreover the separatist group had an extraordinary navy force, agile, well-trained, with perfect knowledge of the surroundings. The so called Sea Tigers were a crucial element of the strategic survival: the supply line was coming through the sea; thus for the LTTE was a priority to maintain a capable navy, which indeed was able to face up the Sri Lankan one.

In the ’80s technology and low prices made it uninteresting to search for oil. But in the 2000s, technology improved immensely in the field, countries like Brazil or Norway became expert in working in such conditions. The thirst for natural resources driven by China sparked a global race to exploit even secondary fields. And price went up.

Seismic survey

Norway’s interest in particular focused on Sri Lanka; in fact they developed an expertise for those geological conditions. So it was nothing but natural that a Norwegian company begun to work in Sri Lanka. TGS-Nopec started started seismic survey in the Mannar Basin (source: PRDS²). In December 2001, the company delineated a “major, unexplored Jurassi-Creataceous continental rift basin. Large structures, thick turbidite sequences and numerous direct hydrocarbon indicators have encouraged TGS-Nopec and CPC to now propose to the industry a major Phase II program” (source: TGS Nopec press release)³.

From 2002 to 2005 the company continued to acquired data about the potential of the Mannar Basin(source: PRDS) ⁴.

Column and cartoon about the breach of contract with TGS-Nopec from Lankanewspaper

From the enthusiasm expressed in public we can argue that the company felt of being close to a major discovery. But suddenly on the 3^rd of March, 2006, President Rajapakse spread the voice he wanted to stop the collaboration with TGS Nopec⁵. This produced a very odd case: the government of Sri Lanka had given concession rights to the company, but it rushed so badly, that it was in breach of the contract. At the time many didn’t understand why Sri Lanka should pay to re-acquire rights on its own land⁶.

Opinions about the breach of contract with TGS-Nopec.
From http://www.nation.lk

It should have been the other way round. Instead the government of Sri Lanka agreed to pay 10.5 USD in compensation ⁷. In the 2001 agreement, TGS Nopec had the right to sell to third parties its data. Sri Lanka wanted to rescind the contract and accepted to pay the termination fee. It seemed like a very odd behavior, given the information available in public at the time. You can assume that Colombo was crazy in terminating a collaboration with a long-standing partner if they weren’t sure. Or you can assume that confidential information was more convincing that the public one. Later on oil was actually found. So either Sri Lanka had gambled and won. Or they knew it for sure since then. These events happened in 2006. If you have some interest in the Sri Lankan civil war, this year should ring a bell.

More to come, stay tuned.

1http://www.prds-srilanka.com/exploration/origins.faces

2http://www.prds-srilanka.com/exploration/origins.faces

3http://www.tgsnopec.com/Subpage.aspx?id=2404

4http://www.prds-srilanka.com/exploration/origins.faces

5http://www.island.lk/2006/04/19/opinion6.html

6http://sundaytimes.lk/061008/FinancialTimes/ft16.0.html

7http://www.lankabusinessonline.com/fullstory.php?nid=883096206