Oil & gas: finding success relocating people

Construction

 Good outcomes for relocated people a new success factor

Access road, drill pad, pipeline, tank farm, trans-shipment terminal or refinery – just about anything about the oil and gas sector takes up space. And in many cases, that “space” is already occupied – by the farms, grazing areas, dwellings, schools, medical facilities, places of worship, villages and towns of the people already there.

While oil and gas companies may try to cause as little disturbance as possible, it is almost inevitable that for development to take place, some people will have to move. Where they are moved to, and the outcome of the move, is becoming a key factor in the success of the oil and gas project.

Failing to stay current with expectations around relocation of populations affected by resource projects can have serious consequences for the project and for the companies involved.

 

Opposition

If people affected by the project feel that they have been mistreated with regards to relocation, they can oppose it in many ways, including vandalism to company assets and possibly, violence towards employees. Local and national governments may impose legal sanctions. Funding sources, including banks and shareholders, do not want to be associated with a project or company that attracts negative publicity. Non-governmental organizations, whether locally based or international, may decide to champion the causes of the people affected by the project, causing more negative publicity.

On the other hand, a well-managed relocation initiative, providing improved circumstances for the people affected, can result in local support when changes and expansions are planned, as well as good relations with other stakeholders.

One of the challenges is that among many people in Africa, resource companies’ reputations are less than stellar. Companies may be seen as primarily interested in extracting resources from the land and not giving anything back. Many people in Africa have experienced what they saw as ill treatment from resource companies, or have heard stories from others. Even though these stories may have originated from times when expectations and standard practices of resource companies were different from today, they are still the reality with which today’s companies must work.

 

Good planning vital to success

One of the trends in relocation is a greater emphasis on planning. Experience shows that developing a good plan for relocation is perhaps 80 percent of success in achieving a good outcome for the people affected by the project, and for the companies involved.

This is recognized by the International Finance Corporation, part of the World Bank, whose “Guidelines” on social, environmental and economic activities increasingly influence the lending decisions of financial institutions. The IFC’s guideline for resettlement (Performance Standard (PS) 5, read in conjunction with PS 7 (Indigenous Peoples) and PS 8 (Cultural Heritage)) sets out what are generally accepted as the current expectations around what the IFC calls “involuntary resettlement.”

Part of planning comes in finding ways to avoid the need to relocate people, the IFC says. This includes both “physical” relocation, as happens when people must move to make way for a new trans-shipment terminal, or “economic” relocation such as happens when their means of livelihood is made unavailable as might happen if a pumping station is located on what was their village cropland or grazing area.

 

Land or labour-based

Planning needs to take into account whether the ‘local’ economy is primarily land-based, as in agriculture, or labour-based as might occur if many people are engaged in manufacturing products such as handicrafts, or in retail as would be the case in a town with a market.

Another growing trend is towards greater participation in the planning process by stakeholders, particularly those directly affected by the expected changes. This includes establishing resettlement working groups, representative of the community. The resource company needs to work within the established political reality and comply with applicable legislation. However, it is not wise to stop with that – the Chief responsible for the affected area, for example, might not live in the area affected, and so it is important to also gain input from people who will be impacted by the project.

We see increasing trends to make greater effort to bring women into the planning process, and in some African cultures this is not easy.

It is important to note that the consultation and planning process is iterative – people need to be given time to think things over. It may well be that a point that was decided in one meeting – such as the location of the water outlets in the new village – becomes “un-decided” by the next meeting. This is normal, and trying to force the issue can result in bad feelings that increase opposition to the project.

The output of the consultative process is a plan that takes as many as possible of the local concerns into account.

Grievance procedures

There is growing awareness that a sound grievance procedure must be available, so people can air their concerns and feel that they have received a good hearing. It’s an issue of balance of power – local people may feel that the resource company has all the power and the money, and that their only option is to resist the changes any way they can. With meaningful participation that builds rapport, people have greater confidence that the issues they raise will be addressed.

A well-prepared consultation and disclosure plan, that details the way in which communities will be consulted and engaged in the project planning process, will go a long way clarifying what information will be disseminated at what point in the process and how companies will incorporate community concerns into the final plan. A grievance procedure provides the extra opportunity for affected persons to raise their concerns about company action, including the relocation process.

The process must be accessible. For example, if someone wants to discuss a problem but the company office is some distance away and might require a taxi ride to and from, it is less likely that the complaint will not be made. Rather, the issue will continue to fester and cause larger problems in future. This points to the importance of frequent meetings in which company officials come to meet with affected communities, to listen with care and respect to community feedback.

Of course, the people need to see effective action taken as a result of their complaints, such as company vehicles travelling more slowly and carefully through their communities.

The consultation process must be an ongoing thing. It’s much like someone moving into a new house – it may take time to discover that some of the kitchen cabinet doors don’t fit, and some of the windows don’t open. People going through a relocation process, and later getting accustomed to their new circumstances, may find issues to raise – and will need an effective forum in which to do so.

 

Leave sufficient time for the planning process

For resource companies, time is money. They plan a drilling programme or a pipeline route and want to start work as soon as possible. However, when peoples’ lives and livelihoods are at stake, and there may already be some distrust in the air, it is unwise to try to rush the process.

In our work helping achieve good outcomes for companies and local populations, we may be told by the resource company, “You’ve got four weeks.” Depending on the number of people involved and the complexity of the economy, the planning and relocation process may take six to 12 months. Failure to allow enough time may result in bad feelings, and more stones being thrown at company vehicles.

The growing importance of relocation, for the success of a resource project, indicates that this is an important success factor. Companies that develop the ability to plan their projects so that they avoid the need to relocate people as much as possible, learn to conduct effective consultation and planning programmes, and then allow sufficient time for the process, will have a strategic advantage in completing their projects on time and on budget.

 

Frank Snijder (MA (Anthropology), MBL) is Social Management Divisional Leader with Golder Associates, based in the company’s Johannesburg, South Africa office. Contact: This email address is being protected from spambots. You need JavaScript enabled to view it.; tel. 27.11.254.4849.

 

 

 

 

 

 

 

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