Can Turkana be the next Abu Dhabi?

www.nation.co.ke November 11, 2013 ·

Over the last few weeks, I was a spectator to three events that led me to ask if it was possible for Turkana, Kenya, in the year 2063, to resemble what Abu Dhabi look like today.
Oil in Turkana

First, I attended MindSpeak, which is a monthly talk session on people or points of interest in the local economy. The subject of this session was extractive industries. Second, the nightly TV news led with stories about people in Turkana protesting over jobs, causing Tullow Oil to temporarily shut its operations there.

Third, I got to spend a few days in Abu Dhabi,  a state in the United Arab Emirates which has used oil and gas to transform itself into a state with the richest citizens in the world.

The images from Turkana that were broadcast on TV were shocking.

In what looked to be an arid, desert area, residents led by local politicians and brandishing crude weapons and placards protested in front of a yard with huge drilling machines and temporary houses, as expatriate workers were escorted to a nearby airport by armed police.

Later, Tullow Oil, which is listed on the London Stock Exchange, broadcast news of their decision to suspend operations in Turkana to their investors and the world.

Abu Dhabi discovered oil and gas at about the same time Kenya gained independence, and the city that visitors see today, fifty years later, is a playground of the unlimited imagination of its rulers, with new high-rise towers and large ongoing construction projects, wide highways and bridges, hotels, malls, one of fastest growing airline networks, and even a Formula One racing track.

Like neighbouring Dubai, which is a one hour drive away, Abu Dhabi has diversified its economy to a point that revenue from oil and gas are almost matched by that from a combination of other sectors like real estate, finance, tourism and logistics.

The MindSpeak forum brought together people who were able to articulate points for the three crucial parts of the extractive industries story; mining companies, local residents, and governments.

Speakers included executives from natural recourse companies, human rights organization workers representing local resident and community interests, and diplomats from governments like Canada that have long histories with mining operations.

Amid the discussion on the blessing or curses that resources have been for countries like Australia, South Africa and DRC, there were a few answers to the scenario that played out in Turkana a few days later.

First, just because a place has proven natural resources do not mean that they will be exploited. Second, extraction is an unbelievably risky process for investors. It takes many years to develop, and millions of dollars with a success rate of about 1 in 1,000. Third, communities have to be included in mining processes that respect their land ancestry and usage.

Governments have to provide stable mechanisms for both communities and mining companies to mutually benefit including policies on revenue, taxation, land rights, employment, environment and infrastructure such as roads and electricity.

In turn companies can also deliver benefit to communities that are far greater than tax revenue, in the form of employment and education opportunities, supply contracts, and infrastructure enhancements.

Until recently, Kenya was not thought of as a country rich in oil or mineral resources, and there are many more chapters and years before the story of extractive industries here is completed. Time will tell if a city will grow out of Turkana by 2063 that resembles present -day Abu Dhabi.