For international peace. We are trying to show you as much as we can before things get started. [inaudible conversations] [inaudible conversations] ladies and gentlemen, thank you very much for coming. First of all we are into the season where the city tends to empty out, so we are all delighted that you are here to discuss a problem that, you know, is arguably as important in the us as it is around the world where we will focus on it. Lets me briefly introduce myself and who will be conversing with today. Im sarah cheneys. Simon is going to kick us off, simon taylor who is one of the founders of Global Witness, which is in my view one of the most innovative and effective organizations working in the space around the world and its very interestingly combined with advocacy with extremelyadvo regressed investigations and thats one of the things we will talk about today is a recent report by Global Witness about shells activities in nigeria. He also helped galvanize the coalition of Civil Society organization, 40 Countries Worldwide working for more accountability and openness in the sector. Is called publish what you pay. Sitting next to simon is steep call who is the dean of Columbia Journalism School and so has a whole other dimension in the current political space and he also, i mean, has one no less than two pulitzer prizes. The first one for reporting on the security and change commission which again has real relevance here and hes also the Office Author of private empire, which i recommend to all of you when youre done with this go out and buy private empire and it tells you a lot, not just about the industry, but also about quite an important element of us politics at the moment and we have a member of that human and Environmental Development agenda and i just love that. Like, lets put those two together, human and Environmental Development sidebyside. He is an expert on the oil sector in nigeria and participated in this investigation as well as some others. So, thank you again. D join lets come over here and join the conversation. Ust ask your forgiveness. While i do this. Askingjust start, by about this. It and what caused you at Global Witness to feel like this was such a critical subject to investigate . That is a good question. It is not just they who knew. Other people knew. Perhaps i can start with some boring stats that i think say quite a lot. Many of you would be familiar with the oecd Antibribery Convention from 1999. 14 in 2014 they did a study of some 400 Corruption Cases which looked at the period of the operation of the convention. Foley twothirds of the cases they looked at involved just for sectors. Guess what . The one that was, featured the most time was the sector with 19 of the cases. Most of these involved public procurement, and also included players who were from wealthy countries. I think we can say quite a lot about that. Ive spent i guess Something Like the less 20th looking at corruption in the gas and mining sector. Every way we look in certain regions i no longer ask where is the corruption. Its more which concession is not corrupt. I think thats a very true situation. W on top of that i would say there certain members of the oil industry who i view now as serial corrupt because everywhere we find that they been involved in corrupt deals. So thats the them thing i woule to set. One of the things weve been doing in this past 20 year time has been on the one hand, understand how corruption works and then look at policy prescriptions that might come to play along with otherrdoing prescriptions, because were not just talking about the oil industry. We are talking about how banks operate, how monies flow internationally if we can come back to that in the discussion about solutions a bit later. But actually to understand the different mechanisms of corruption got to investigate and thats where this comes along. This is merely the latest development in our work on this case study in nigeria called to 45. It is west africas largest oil block and the history, i wont go beyond high level detail, but essentially it boils down to a a deal that was concluded in aprie world secondbiggest oil company in the u. S. And the uk and the netherlands, together with its partner which is italys Largest Corporation acquired to 45. The problem is they had spent two years directly negotiating with the person who owned it which was none other than former nudging dictator in april 90 april 1998 someone set up a Shell Company called malibu, basically a piece with othersgether sort of acretary was lawyer in a backstreet office, for those of you who know the breaking bad theory. That is what we were involved with. Investmentiondollar going to bed with a piece of paper. No skill set, no knowledge, no backup. They mustve known this was a stolen piece of real estate. Battleslitigation happened. Malibu lost the block. Show built it. Various litigation processes. Then we realized in the beginning there was a twoyear time with delightful court cases. One particularly noticeable is one where a former miasix wascial helping them and saido some people it was difficult to come to an arrangement where they would be happy with the amount but we are getting on much better. Effort they went through collapsed. But then that general who also happen to be a lawyer rocard the deal. Billion dollars through nasco arrangement in london run by jp morgan and the money filtered off into Shell Companies in nigeria. Where did it go . This is interesting because we required intel emails which showed the highest levels in the company were in the loop. Go onnew the money would to the highest level officials yet they went on with the details anyway. Stolen goods, they did not pay the Nigerian Government and they are now being investigated in criminal investigations throughout the countries. Reinforce something. So, you have got all of this shell with the shell arrangements, right . But, what is it that they are circumventing . In other words, theres a fairly clear nigerian law, correct . Theres multiple laws. It was illegal for him to give himself as minister nigerias biggest offshore block. Shell could not not know who he was. They got within four years. The. As though he were the private owner . Right. Than the parent structure went after an arrangement in london. We consider that to have been a because,e creation should they pay as required through the federation accounts. The money that was going into the whole of government wouldve had to be expropriated by the official process. It couldve no longer been used to pay people. That had to create an offshore system. Toi think that is the way, belabor the obvious here, with this whole thing is about is tell me if i have this right you have Nigerian Government people assets which by nigerian law, the payment for it needs to go into the federation account, which is like the federal budget, right . And they directed that payment not to go into it. That structure was created by the way in which the bill was constructed. The mechanism was created to bypass. The money was considered to be an off the back of the truck prize. So there is a question they are. This is an english expression. I apologize for that. A Bargain Basement price . Towhy would anyone want bargain a cell of price . Well, one of the things we see from in these emails is that there was a highest level discussion with an shell about how they knew there was a high likelihood the money would go on to various undetermined mechanisms to highest level officials, including johnson, who is specifically mentioned. So we have an internal discussions at high levels and they went ahead anyway. Shell shell is talking to about the fact that rather than by this asset from the nigerian people, they were going to buy it as so it were the personal property of this little Shell Company. And, by calling it the personal property of these three guys, they were able to get it wicked cheap whereas if they had had to buy it from the nigerian people, presumably the Nigerian Government would have negotiated. If it were a government acting on the behalf of its people, if it were that type of government, it wouldve put the screws into get a much higher price. It you would expect it wouldve looked after the interests of its people and sold it for the best price they could get it for. And, there are many other aspects of this that are very complicated to discuss, but in the actualy saw that someonef the asset was else. But they went through the process of trying to buy direct from malibu. Having negotiated for nearly two years and ended up concluding the detail brokered by the attorney general who used to be a lawyer. And, the arrangement they created was this offshore structure. This was not an arrangement the attorney general constructed. Designedan arrangement by the company. You been looking at well i has have Global Witness. I just wonder if you can place this story in, you know, again, you can place the story look at this in a number of other countries. Is this an aberration . Is it relatively typical . What are we dealing with in this sector . Its a fascinating case and it sounds like it will go on for a while. We will probably learn more as investigations by judicial authorities proceed. Yes, it is part of a much larger picture, as simon alluded to. Thought i would mention a couple of points of context, may, for my own reporting. Sarah was kind enough to mention private empire, its a book about exxon mobil and american foreignpolicy was the idea. I started out just to write about the geopolitics of oil in the age of constraints, the age of Climate Change, the age of increased competition, and i got out and did research and thought, i dont have a story here. I had no idea what i was getting into. I chose exxon mobil. It seemed like a good subject at the time, and so then i made a map of where exxon mobil produced its oil. I was interested in the distortions created by wealthy, Global Corporations extracting oil in very, very poor societies. Not even just developing societies. But the poorest. One of the examples was chad. They had been there, trying to develop some rather difficult landlocked oil that had difficult geological characteristics, was a long way from the ocean. Nigerias recurring scene of these kinds of crimes because nigerian oil is very appealing, its right near the ocean, its very easy to get to market, its sweet crude, and it produces well. But chads oil is difficult oil. And, chad is a very poor society, very unstable, subject coup attempts repeatedly. I flew in and i was starting to report, i drove down to the oil area, talked to people who live down there, people who worked on , governmentmpound officials, Civil Society activists. After a couple weeks i looked around and said, why is exxon mobil here . What are they doing here . I mean, they are producing a few hundred thousand barrels of oil a day in a consortium, that this is really difficult territory. Its politically unstable. Why is it necessary to be here doing this business . Theres an interesting, important answer. One of the dilemmas, at least until the shale revolution, Big Oil Companies phase was that faced is that they were producing more oil every year then they were finding. They had run out of easy oil, basically. They had run out of domestic oil, they had run out of simple oil to produce, and so they were going further and further into difficult frontiers, both difficult production frontiers like the arctic, where there were high risks, and difficult engineering challenges, but also difficult clinical frontiers. Political frontiers. Because they just needed the oil. Because every 200,000 barrels a day counted trade that was the answer as to why they were in chad. That is also why they were in which oil ginny and in other places were no reasonable company would want to do business, to be honest. In equatorial guinuea and also in other places. In places where no reasonable company would want to do business, to be hone its about proving to your shareholders, right . That for every barrel of oil you sell, you found a new one. Because who would want to buy shares in a supermarket that only has as much milk as is on the shelf . Is at the right way . That pressure was especially strong about the time that i was working on this book but yes,rs thats it. Barrel of oil you sell, you found a new one. Because who would want to buy shares in a supermarket that only has as much milk is on teh shelf. That pressure was especially strong around the time i was working on this, but yes. Thats it. The other thing you have to understand, and im sure you run into this, and it is putting bribery cases like involving shell, and maybe more shell than any into it, into a larger context, if you look at a list of the 20 largest Oil Companies in the world, 18 of them are state owned. Owned by russian entities, by china, by india. Its an exception, exxon mobil, to be fully privately controlled to the extent that you consider exxon mobil independent of the United States, they see themselves as independent of the United States. What interesting about what simon and folks do, and we will get to this in the solutions part, the very fact that these companies are accountable to stakeholders other than governments that own them actually creates a point of leverage. They have different vulnerabilities, there have shareholders, securities and Exchange Commission, Civil Society groups they meet with, whereas rosner doesnt feel those pressures. Its a complicated structure to think about trying to change because you have all these privately Held Companies that feel, why are we the guinea pigs for a global government system that doesnt touch our state owned competitors. It also means theres probably quite a lot of these transactions. Summary even worse that we cannot access despite the best investigators in the world. I would say the u. S. , the last point i wanted to make by way of context is that i think its important to say out loud that this administration, unlike the last republican administration, is actively departing from transparency as a solution to corruption in the extracted administration. The Extractive IndustriesTransparency Initiative which we will talk about later which isus by no means a magic bullet but it is part of a suite of transparency efforts that were developed in the early 2000s with the support of the bush administration, and that the Trump Administration has come in and basically, one of its first acts of rolling back obama era rules pulled the plug on transparency requirement that the securities and Exchange Commission was meant to bring forward and has been signaling that theyre going to withdraw the United States from participation in the iti, and even more advanced form of participation developed during the obama administration. D and n signaling they are going to withdraw the United States from participation in the iti and even more advanced forms of participation than developed under the obama administration. And we will get to this. I was writing something yesterday about journalism in these times. One of the things that occurred to me, piecing through some details and this isnt surprising, maybe not that interesting. I think of the practical matter, all these rights and norms are intertwined. We tend to take them on in silos, whats happening to environmental regulation, whats happening to pressure attacks on professional journalism, whats happening to transparency. Whats happening to Civil Society, not just in this country, but in lots of other places. If you look back to the pressures on Civil Society groups like Global Witness over the last 10 years, globally, and the space in which groups like that operate, it has been narrowing quite steadily. And now it has just pivoted off a cliff. When we talk about corruption and strategies to combat it, and the extractives, looking at the next 3 or 4 years, you have to place the question in context of a general repudiation by the United States government of a whole series of comparable to transparency. This is a real departure, a departure, just to put a punctuation mark on it, its a departure from the republican partys conspiracy. We are to circle back on a number of these points. Youve done some work on mobile exxon mobil in nigeria, havent you . What have you been working on . Its important to detain in which the oil industry thats what i wanted to get that. Youre on the receiving end of a lot of these practices. Tell us what it feels like to be working with people who are on the ground where this extraction is taking place. I get a little bit worried, listening to the United States is actually pushing around the area of transparency and accountability. Coming from a background where you have seen the capacity of very key sectors, operating a colony operating like a criminal enterprise, thats majorly about the key 5 Oil Companies operated around the world, sometimes nondeclaration of the leasing of this oil. This is a country where it is possible for 200,000 barrels of crude oil to disappear on a daily basis, either to the sea or the port. What does that look like . Can you help us picture, imagine what does it look like on the ground, and how is it possible for 200,000 barrels of oil jus