Strategic and Tactical Objectives

By Anonymous

In addition to expanding exploration, increasing refining capacity and adding power generating capacity, Cameroon’s strategic and tactical plans also have strong components aimed at improving transportation and communication networks. Expanding the social, health and environmental protection programs that are already underway will also be keys to the country’s economic future.

All these efforts will be facilitated by an increasing stable business environment that welcomes investment.

Energy, water and electricity are crucial to economic development, said Sindeu Jean Bernard, Minister of Energy and Water. "This Ministry will play a key role in all these aspects of the fight against poverty," he said.

Minister Bernard is also interested in the In addition to having less impact on the environment, these technologies could be especially important in remote areas where localized production units could make energy more easily available.

Current business structure

World Bank guidelines have suggested more privatization for industry in Cameroon. Cameroon Petroleum Depot Co. (SCDP) was one of the first companies to be considered for privatization, according to Mr. Ibrahim Talba Malla, Chairman.

Currently, the Cameroon government owns 51% of SCDP and private ownership is 49%. "Even if we sell 5%, I think the private sector can run the SCDP more efficiently." said Mr. Malla. He notes that Cameroon’s refining company, Societe Nationale de Raffinage (SONARA), is different; state entities have 72% of SONARA. "I think that is too high," said Mr. Talba Malla.

The older of two frameworks for foreign participation in Cameroon’s petroleum business, the tax-royalty model, is outdated, said Pecten Cameroon Ltd.s Mr. Ruud Schrama. The new production sharing contract regime established by the 1999 petroleum code, allows the contractor to begin development as soon as commercial discoveries are made. Most of Pecten’s businesses are in the tax- royalty regime in which the "contractor" runs the day-to-day business but the state, through Societe Nationale des Hydrocarbures (SNH), has a 50% share in the partnership.

"We are in daily contact (with SNH)," said Mr. Schrama. SNH does have shares in Pecten, but the focus of the state company as it governs on behalf of the Republic is primarily on SNH’s 50% of the entire porfiolio instead of its 20% share of Pecten, he said.

Infrastructure needs

Air travel is important to the success of both Cameroon’s oil and gas development strategy and the country’s economic growth. Progress has been made in enhancing the air travel segment, but more needs to be done, according to Mr. Sama Juma, General Manager, Cameroon Civil Aviation Authority (CCAA).

Last year, the World Bank pledged significant investment in Cameroon through the West and Central Africa Air Transport Safety & Security Project to bring airports in line with international security and safety standards.

Foreign investment in this sector is not well developed, said Mr. Juma. "But the grant of $14.5 million from the World Bank to ensure the security of our airports, increase capacity and train personnel is a major breakthrough."

Part of the grant will go to building airport security fences in Douala and Yaounde. That is a priority project, said Mr. Juma, because the airport does not have enough personnel to carry out security checks.

The Energy sector has already contributed to the development of the aviation industry Cameroon Oil Transportation Co. (COTCO) and others have helped rehabilitate provincial airports, and COTCO built airstrips along its pipeline to facilitate inspection and maintenance.

Because it uses the Belabo airport on a daily basis, COTCO has made a significant investment there, as well as at Kribi, according to Jacky Lesage, General Manager, COTCO.

Since the country’s road network is not well developed, rehabilitation of secondary and third grade airstrips throughout the country would facilitate the movement of people and goods. "We welcome the initiative of the oil companies and others who might want to help us rehabilitate these runways," said Mr. Lesage.

CCAA is drawing up plans for those who might be interested in investing in the air transport infrastructure. "For now, we are looking for partners to come and build the runway, airport building, control tower and other facilities at Kribi airport," said Mr. Juma. Based on the "Build, Operate and Transfer" policy, an investor could operate the airport for some time before giving it to Cameroon.

Since independence, Cameroon has been a member of the International Civil Aviation Organization (ICAO). "We do all we can to ensure that we comply with the regulations set out by the ICAO," said Mr. Juma.

Cameroon has three international airports-Douala, Yaounde and Goroua. Its four secondary airports are Maroua, Ngaoundere, Bertoua and Bamenda. In addition to the national airline company, Cameroon Airlines, other small charter airlines and local airlines are entering the market.

The port of Limbe is another very important project, said Prime Minister Ephraim Inoni. Currently, the port of Douala is expensive to operate because it must be continuously dredged. Using smaller vessels adds to the expense.

"We need a deep sea port in Limbe or Kribi" said Prime Minister Inoni Limbe is in a volcanic area where silt is not a poblem; it could also serve as a hub for the central and western regions of Togo.

Enhancing quality of life

Part of Cameroon’s development strategy deals with improving health, safety and environmental protection. COTCO is an example of how energy industry companies can make social, economic and environmental contributions to Cameroon. The company provides work for about 1,200 people on a permanent basis.

"Safety is a top priority and we are very proud of our society record," said Mr. Lesage. "We just completed four years without lost- time incidents among both employees and contractors."

Through its "roll back malaria" program, aimed at reducing the occurronce of the disease along the pipeline corridor, COTCO has distributed 35,000 mosquito nets along the route. The company also has educational programs on AIDS and an effort underway to fight cholera.

Since the start of the pipeline project, COTCO has provided funds to individuals and communities as part of its responsibility for environmental protection. By the middle of last year, individual compensation totaled about $11 million and community compensation amounted to $5 million. The company has refurbished about 100 classrooms along the pipeline route and continues to drill and upgrade water wells along the corridor.

Oil inauguration, Cameroon-Chad pipeline.

"Energy, water and electricity are crucial to economic development. This Ministry will play a key role in all these aspects of the fight against poverty." Sindeu Jean Bernard. Minister of Energy and Water

Ports play a vital role in transport.

Copyright PennWell Corporation Jul 14, 2008

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