Reference

The name of the author: Prince Babiene Sona (Esq), Co- authored with Awa Rumarick Mokom
The year of publication: 26 December 2022
Name of the Website: Human Rights and Legal Research Centre,
The URL or link: https://hrlrc.org/2022/12/26/the-role-of-international-law-on-oil-and-gas-governance-in-cameroon-prospects-and-challenges/

The date on which you accessed the website:

Background

The economic development of any state is associated with the ability to extract and govern its endowed natural resources, among others.[1] It is worth noting that the integration of the natural resource industry with other sectors is important in creating synergy between them, thereby stimulating the development of other sectors in a holistic production chain.

As an invaluable resource, oil exploration in Cameroon began in 1947 during the colonial period, and led to the discovery of the first commercial deposits in 1972. Commercial production started in 1977 in the Rio del Rey basin on the west coast of Cameroon, run by the French oil company Elf Aquitaine.[2] With the retrocession of the potential oil and gas rich peninsula of Bakassi by Nigeria in 2006, new explorations have been registered and discoveries are expected to boost the country’s reserves considerably.[3] The significance of the oil sector is even more visible regarding its contribution to the country’s foreign exchange earnings and government revenues. Crude oil products are Cameroon’s main export, representing more than 55% of export revenues in 2007, far beyond timber and wooden constructions, at about 15% of revenues, and cocoa beans, at 0.2%.[4]

In fact, the greatest challenge that affects developing countries is how to translate the hard-fought struggle over natural resources sovereignty into the economic development of the people. It is rightly noted that, at the beginning of the debate, the developing countries and newly independent states were demanding for the recognition of their inherent right over the endowed natural resources. As such, the debate leveraged against the developed countries and the multinational corporations, which were largely controlling the substantial shares in the natural resources sector. It was alleged that developed countries had, through dubious agreements, exploited the developing countries’ natural resources.[5]

Today, the natural resources in these countries, instead of being a blessing, have turned out to be a curse. The peoples’ claims for the benefits derived from the exploitation of the abundant natural resources have, ironically, been directed towards governments. Prof. Chris Peter Maina commented thus; it would seem that Africa has gone around in a vicious circle. Thirty years later, the continent is back where it began. Multinational corporations, assisted by the local comprador elements are back with vengeance.

 For a number of decades now, the main concern is how the political elite in the entire African continent and Cameroon in particular is managing the natural resources. Contrary to the peoples’ expectations, what seemingly appears to be a common feature in the continent is the control of the natural resources under exclusive preserve of the governments while the majority of the population are left with few options at their disposal.[6]  

Notwithstanding the increased inflow of direct foreign investments in the continent, statistically, the poverty has increased steadily challenging the relevancy of the foreign investments in the developing countries in general and resource-dependent states, in particular.[7] Apart from the abject poverty striking the continent, as if the devil was born and buried there, natural resources have been sources of intrastate conflicts bedeviling the continent, in particular, in countries endowed with the abundant resources.[8]

There is an intensification of intrastate debates over the natural resource governance, particularly, the distributional concern of the benefits derived from these resources. In addition, the contemporary debate challenges the uncontested state’s sovereignty claims over the ownership of natural resources by charting out the means of developing ideals that are aimed at distributing the economic benefits to the entire population in the resource-rich states, among others.[9] 

However, the question of ownership over natural resources between the states and the people within a confined state’s boundaries, among others, never got a deserved attention of the parties, which equally, call for an international legal approach.[10] That said, the extraction of natural gas (oil and gas) sees the deepening of a range of the legal, political, economic and social challenges. In order to ensure that the natural gas resources will be used sustainably for the benefits of the present and the future generations, key issues of the public debate are; the need for a regulatory environment that fosters transparency during the negotiation and award of the oil and gas extraction contracts and the revenues accruing from the extraction.

The Concept of Governance as Applicable to the Oil and Gas Industry of Cameroon

Governance has become one of the most fashionable concepts in the past. It has become a part of many studies, papers, declarations and recommendations in a wide range of subjects at all levels of society. Although there could be an agreement on what constitutes “good” governance, and, its advantages, the difficulties actually lie in the vagueness of the term itself. Are we sure about the definition of the term governance? Do we not use the term to describe everything and nothing at the same time? Is there only one definition? or is it better to use plenty of characteristics and broad definitions? In all, the term governance is amorphous and cannot be limited to a single definition. At this point, we will try to define the concept and link it to the oil and gas industry.

In the past, “Governance” was mostly understood to be the result of government activities, and primarily dealt with political science. However, the term has evolved over time and cuts across various fields of study with law inclusive. Governance refers to a process of the act or functions of exercising (usually legitimate). Governance chiefly focuses on the process of governing involving interactions between various formal and informal institutions as well as influencing the policies and decisions that concern public lives.

The success of governance depends on the reinvention of the government, reinvigoration of non-government sectors, with a social motive. There is a need to have political will, normative concerns and organizational flexibility. Because, it is imperative to pay attention to the mechanisms and modalities followed by governments to determine public policies and equally important, to critically examine whether the policies are being efficiently and honestly implemented by the government agencies and organizations responsible for performing the assigned tasks. It also needs to be seen whether, and to what extent, the governments have established meaningful linkages with various elements of civil society, which can support the concern for good governance.[11]

Governance needs to be transformed to make it the key instrument towards effective implementation of public policies. This requires a multi-pronged strategy to strengthen the capacities of all the actors involved in the governance process. Governance as sustainable human development needs to be given a wider connotation, so as to bring within its fold, not just good government, but also other formal and informal institutions, public-private interface, legal and regulatory reforms, decentralization of economic functions, and empowerment of communities.[12]

Governance is therefore guided by several principles. Such principles include accountability, control, responsiveness, transparency, public participation, efficiency, and economy. It involves an efficient public service, an independent judicial system and legal framework to enforce contracts and responsible administration of public funds. Other aspects of good governance includes an independent public auditor to a representative legislator, respect for the law and human rights, and a pluralistic institutional structure.[13]  Apart from the above, governance is predicated on three segments of the society. These three segments includes the type of political regime, the process by which authority is exercised in the management of the economic and social resources with a view to development, and the capacity of governments to formulate policies and have them effectively implemented.[14]

The concept is very relevant to this study as its principles will aid the understanding of the study as it can be used as indices to measure or assess the extent of effective governance in the oil and gas industry and its implications on the environment. Therefore, a proper understanding of the theory of good governance and its principles is a sine qua non to a proper understanding of governance in Cameroons oil and gas industry. Unfortunately, when it comes to good governance practice in the oil and gas industry in Cameroon, the same is lacking behind expectations.

The overall state of governance in the country is considered poor according indexes of government quality. Various measures of governance have been devised in the past decade to access governance quality, that is, the institutional structure and decision-making environment at the political and economic level. Most of these measures emphasize three main characteristics: (i) efficient and capable state, (ii) accountability to citizens (iii) respect for the rule of law. According to the world bank indicators of good governance, there exists six indicators of good governance, including inter alia; i) control of corruption, (ii) rule of law, (iii), voice and accountability, (iv) government effectiveness, (v), regulatory quality, (vi) political stability. The percentile rank of Cameroon on each of these six is presented in Table 1 along with the average values for African and middle income countries.[15]  Cameroon ranks in the bottom quintile of countries overall for all dimensions of governance, except political stability, where it is in the bottom third, and is below that of other middle income and other African countries on all dimensions. 

Table 1: Governance Indicators: Cameroon, African and middle income countries (World Governance Indicators 2007)

Governance Indicators		Percentile Rank (0-100)
Cameroon	Sub-Saharan African countries	Mimiddle income countries
Control of Corruption	15.9	30.7	37.4
Rule of Law	12.9	28.3	37.7
Voice   and Accountability	21.2	33.2	38.4
Government Effectiveness	17.1	26.8	37.2
Regulatory Quality	24.3	27.8	36.9
Political Stability	31.3	34.2	39.4

Source: Kaufmann D., Mastruzzi M. and Kraay A. (2008), “Governance Matters VII: Aggregate and Individual Governance Indicators, 1996-2007” World Bank Policy Research Working Paper No. 4654, The World Bank, Washington, DC.

According to various other measures of governance, institutional quality, in particular the level of corruption, is very problematic in the country. According to Transparency International Global Corruption Barometer 2007, 79% of citizens in Cameroon report having paid bribes to government officials during the past 12 months –the highest rate of bribe payments among African countries surveyed. Businesses operating in the country also cite corruption as one of their main problems, being reported as the second most important constraint for doing business according to the World Economic Forum’s Global Competitive Index, just after access to financing.[16]

Various other governance quality indicators also point to a very low governance level in the country. For instance, according to the World Economic Forum’s 2007 Global Competiveness Index, Cameroon is the third worst country overall in the international index in terms of diversion of public funds (126^th out of 128 countries). The country also ranks very near the bottom with regard to strength of auditing and accounting standards and public trust of politicians (respectively 122^nd and 120^th). Overall, it ranks 120^th out of 128 countries for its institutional environment as measured by the independence of its judiciary, the efficacy of government and the level of corruption.[17]

The natural resource governance is a complex phenomenon in the contemporary world where natural resources are the requisite ingredients for fueling production in the different economic sectors.[18] However, the conditions surrounding the extraction of natural resources are convoluted. The parallel, yet contentious interests between various stakeholders asserting their respective interests exacerbate this. The State, the private sector and the NGOs especially the community based organizations should cooperate and coordinate with each other to make good governance possible.

The Importance of Oil and Gas Resources to the Cameroonian Economy

Oil and gas operations can contribute to improving the livelihoods of communities living in producing areas by promoting the sustainable development of the often-marginalized regions were these were the resources are typically located. Local development impacts of hydrocarbons development can be realized in various ways: in the form of revenue transfers to the government and to the local economy by generating employment.[19]Oil and gas products, especially motor gasoline, diesel, and jet fuel, provide virtually all the energy consumed in the transportation sector. Distillate fuel oil, which includes diesel oil, heating oils, and industrial oils, is used to power diesel engines in buses, trucks, trains, automobiles, and other machinery. It is also used to heat residential and commercial buildings and to fire industrial and electric utility boilers.[20]

 Furthermore, there is asphalt or bitumen, which is used to pave roads; and naphtha, which is the main feedstock for petrochemicals. Liquefied petroleum gas also known as butane and propane are an automotive fuel and are used for household heating and cooking. Kerosene is used for residential cooking in many parts of Cameroon and commercial production processes. The oil industry is a major, and one of the largest, employers of labour across Africa. In 2010, 6 out of the 10 largest companies in terms of revenues were from the energy and mining sectors.[21] The oil sector has also accounted for a rapid growth and boost in tourist activities in several oil producing oil communities across Africa. Given the importance of the oil industry to governments and households, the importance of effective regulation to ensure maximum and sustainable management of oil and resources cannot be overemphasized

The significance of the oil and gas sector in Cameroon is even more visible regarding its contribution to the country’s foreign exchange earnings and government revenues. Crude oil products are the country’s main export, representing more than 55% of export revenues in 2007[22] far above timber and wooden constructions, at about 15% revenues, and cocoa beans, at about 0.2%.[23] In terms of GDP, oil revenues represented about 6% of total GDP in 2007, against 14% in  1985.[24] Cameroon therefore relies heavily on oil exploitation, which has always accounted for a large share of its revenue. As an illustration, between 2015 and 2019, the contribution of the oil sector to the state budget fluctuated between 387 and 774 billion CFA francs, making it the second largest source of budgetary revenue in Cameroon.[25]

Finally, the Cameroonian oil and gas industry has overtime increased the rate of employment both directly and indirectly. The direct impact of the oil sector on employment is known to be small. The secondary sector of which it forms part, is growing (from 7 % of total employment in 1976 to 13% in 1985). Of the 534,000 workers in this sector, the oil industry employs about 0.5%. (This compares with Kuwait 1.3% and Saudi Arabia 2.4% whose oil industries are of course m u c h larger.). The oil industry has been expanding at much the same rate as the average for the secondary sector, which for a highly capital intensive industry could be considered as a rapid rate of employment growth. The indirect impact of the oil industry on employment has certainly been greater than the direct. During the four years 1980-1984, because of the revenue from the CHB account, the private and para-public sectors were able to generate annually about 20,000 new jobs while public sector employment increased by some 8,000 per year.[26]

Regulatory Framework on Oil and Gas Governance in Cameroon

Cameroon has ratified a number of international conventions on oil and gas governance. These international treaties include inter-alia the 1945 United Nations Charter which provides for the principle of equality of all nations, the doctrine of permanent sovereignty over natural resources and the principle of equal rights and self-determination of the people.[27]  The Charter of Economic Rights and Duties of State, 1974 also regulates natural resources. Its article 1 reiterates more or less in a similar way on the right of states’ of full and permanent sovereignty over natural resources as articulated earlier by the NIEO declaration. Article 2 provides in details how the rights of the sovereignty over natural resources can be exercised.  It is profoundly important to quote it verbatim for ease of reference and an appreciation of its ensuing discussion.

Article 2 provides;

Every State has and shall freely exercise full permanent sovereignty, including possession, use, and disposal, overall its wealth, natural resources, and economic activities.

2. Each State has the right:

(a) To regulate and exercise authority over foreign investment within its national jurisdiction in accordance with its laws and regulations and in conformity with its national objectives and priorities. No State shall be compelled to grant preferential treatment to foreign investment;

(b) To regulate and supervise the activities of transnational corporations within its national jurisdiction and take measures to ensure that such activities comply with its laws, rules, and regulations and conform with its economic and social policies. Transnational corporations shall not intervene in the internal affairs of a host State. Every State should, with full regard for its sovereign rights, co-operate with other States in the exercise of the right set forth in this subparagraph;

(c) To nationalize, expropriate or transfer ownership of foreign property, in which case appropriate compensation should be paid by the State adopting such measures, taking into account its relevant laws and regulations and all circumstances that the State considers pertinent. In any case where the question of compensation gives rise to a controversy, it shall be settled under the domestic law of the nationalizing State and by its tribunals, unless it is freely and mutually agreed by all States concerned that other peaceful means be sought on the basis of the sovereign equality of States and in accordance with the principle of free choice of means.

As noted in the preceding part, the attitude and the approach taken by the developing countries on the sovereignty over natural resources were a sudden U-turn. The Charter took a radical approach against the foreign investment interests and their states of origin as comparatively demonstrated hereunder. Firstly, whereas, in the UNGA resolution 1803, the nationalization of foreign investments was allowed under the condition that some standardized nondiscrimination measures must be complied with, under the Charter, the right to nationalize foreign investments by the host state could be exercised without limitations. The host states were free to determine when to exercise the right as they deemed it fit. There was no reference to the international law, thus, any form of regulation and the domestic laws of the host state shall exclusively deal with control of the foreign investment activities.[28] 

Secondly, the question of compensation in the event of the nationalization of the foreign investments was left exclusively to the discretion of the host state. The 1962 UNGA resolution 1803 subjected the payment of an appropriate compensation in accordance with the law applicable in the host state and international law. The Charter provided for the payment of an appropriate compensation in accordance with the principles and standards of the host state. The 1962 UNGA resolution made reference to the international law on the understanding that where the standards and principles of compensation by the host states are on the lower side, recourse would be made to the minimum standards provided for under the international law in respect of the treatment of alien and aliens properties. The discretion accorded to the host state in determining the amount of compensation payable may be exercised arbitrarily. More so, the wording of the Charter used the word ‘should’ instead of the mandatory ‘shall’ thus, this discretionary power is enormous and therefore, the host states may decide when to pay the appropriate compensation or not in accordance with their applicable laws, which can be enacted in that, regard.[29] 

For instance, in Texaco Overseas Petroleum and others v Libyan Arab Republic,[30] analyzing the UNGA resolution 1803, 1962 and the Charter with regards to recourse to the international law, the Arbitrator concluded that due to  unanimity of votes in resolution 1803 on the above subject, it undoubtedly reflected the customary international law contrary to article 2(c) of the Charter relied by the Libyan government permitting the amount of compensation to be determined by its national law which did not find a broad support by various representatives.[31]

Thirdly, which runs from the effects of the first two above, is the settlement of disputes ensuing from the envisaged nationalization. The Charter stipulated two alternatives. The first one is legal and the second one diplomatic cum political. Firstly, the tribunals of the host state would determine the controversies ensuing from the nationalization. Secondly, states may resort to other peaceful means where there is an agreement between them. Thus, the Charter does not provide recourse to the international arbitration or adjudication. There was an interesting argument from the developing countries that subjecting host states to extra-national procedures relating to a dispute arising from the issues related to compensation would place the states on an equal legal footing with the foreign corporations.

More so, the African Charter on Human and Peoples’ Rights, 1981 also addresses issues of oil and gas resources. Unlike the American Convention on Human Rights and the European Convention on Human Rights which do not seem to address the right of the people to control their natural resources, article 21 (1) and (4) of the African Charter on Human and People Rights[32] vest the right of disposition of the natural wealth and resources to both the states and the people albeit in the same article but in different sub-article[33].

 The vesting of the natural resource sovereignty to both the state and the people in the Charter was to take cognizance of the newly emerged third generation rights, which were trending at the time of making the Charter. If the right of sovereignty over natural resources is part of the third generation rights, then it would be rational to assume that the state’s right to deal with them creates a reciprocal duty under the international law to use   them for the economic development and well-being of the people.[34]

In addition, it is arguable stated that the vesting of the right to both the state and the people was made purposely in order to meet both the internal and external factors of the economic self-determination. It was thought that since the state has the locus in the international law, it would best suit as an intermediary in dealing with the external interests on behalf of the people in a manner, which the people cannot, do in that regard.[35] Accordingly, the thesis seems to incline in the faulty assumption that the state would, in most cases, represent the interests of the people when dealing with the external economic interests on behalf of the people. In addition, it does not seem to address the issues of convergence and divergence between the people and the state interests since the peoples’ interests are not necessarily the state interests and vice versa. It is argued those if one equates the people with the state further strengthens the state and subject the interests of the people to those controlling the political power.[36]

Moreover, The United Nations Convention on Biological Diversity ratified by Cameroon on the 19^th of October 1994 also regulates natural resources. The Convention on Biological Diversity also called the Biodiversity Treaty is an international treaty designed to promote the conservation of the natural environment and all species inhabiting it. This convention therefore shuns at every activity whose operation pollutes either the atmosphere or water bodies, not leaving out activities carried out on land. This convention generally prohibits any activity that may destroy biodiversity in any way. In fact the Convention places on state parties the responsibility to ensure that activities carried out within its territorial space do not cause damage to the environment or other states or areas beyond the limits of its national jurisdiction.^[37] 

More so, the United Nations General Assembly Resolution (UNGA R.523), 1952 is one of such instruments that regulates natural resources and oil and gas resources in particular.  The resolution on the Integrated Economic Development and Commercial Agreements was a milestone through which the principle of PSNR was born. It affirms the right of developing countries to determine freely the use of their natural resources for their national economic interests. The resolution recommends to the members of the United Nations to facilitate through commercial agreements the movement of the machinery; equipment and raw material needed by the developing countries for their economic development and improve the standard of living.[38] It also argues the developing countries make use of the natural resources available for the domestic utilization and the international trade.[39] However, the resolution puts a restriction in relation to the commercial agreements which contain the economic or political conditions which tend to jeopardize the sovereign rights of the developing countries, including the right to determine their plan for the economic development.[40]

As stated earlier in this part, the resolution is the first instrument at the international level to succinctly recognize the right of the developing countries to independently manage their natural resources. It also imposes correlative obligations to use the natural resources with the view of integrating them with the world economy.[41] Therefore, the resolution is important in three main aspects, firstly, it addresses the long-fought battle by the developing countries on the recognition of their sovereignty over the endowed natural resources located in their respective territories. Secondly, it acknowledges the empowerment of the people as a tool towards enhancing the exploitation of the natural resource

Thirdly, it ignores the existing contractual rights and the interests of the multinational companies in favor of the resource-rich states. The UNGA Resolution 523 was, in the same year, supplemented by UNGA Resolution 626 on the Right to Exploit Freely Natural Wealth and Resources. It starts with a strong affirmation of three important aspects. Firstly, it encourages the developing countries and, in particular, the newly independent states to properly exploit and use their natural wealth and resources[42]. Secondly, it affirms the right of people to freely use and exploit their natural resources as inherent in their sovereignty.  Any political and/or economic conditions aimed at curtailing the enjoyment of the right violate the principles enshrined in the United Nations Charter.[43] Thirdly, it was strongly argued that the economic development of underdeveloped countries is one of the requisites for the strengthening of the universal peace and security.[44]

The resolution recommends that states owning the natural resources to exercise their right to freely exploit the natural wealth and resources for the economic progression. It also argues states to pay due regards to the need for maintaining the flow of capital as a condition for security, mutual confidence, and the economic cooperation among nations.[45] It further recommends that the investing states should refrain from any acts which will directly or indirectly interfere with the sovereignty of a country over her natural resources. The resolution is significant in two important aspects; firstly, it succinctly affirms the sovereignty right of states over their natural resources and secondly, it encourages foreign investments which guaranteed the flow of capital with a spirit to enhancing the international cooperation among nations.

Notwithstanding, the resolution does not seem to, apart from providing the general statements of intent on the management of natural resources by underdeveloped countries, provide some sort of guidelines which the states have to adhere to in relation to intrastate natural resources governance. Equally, vesting the natural resources interests in both the people and the states will, undoubtedly, benefit states to the detriment of the people especially in a situation where there is an irresponsible government.

As a prelude to Stockholm Declaration, there exist the Declaration of the United Nations Conference on Human Environment (Stockholm Declaration), 1972   the rise of environmental concerns and incidental challenges brought by such concerns around the global, called for more regulations on the natural resources exploitation and governance.[46] Therefore, the UN Conference on Human Environment took place in Stockholm in 1972 and adopted the Stockholm Declaration on the Human Environment containing 26 principles.[47] Many of the principles have relevance to the natural resources governance. However, of interest for purpose of the study is principle 21 which, for the first time, placed sovereignty over natural resources in an international environmental context.[48]

Principle 21 reads; States have, in accordance with the Charter of the United Nations and the principles of international law, the sovereign right to exploit their own resources pursuant to their own environmental policies, and the responsibility to ensure that activities within their jurisdiction or control do not cause damage to the environment of other States or of areas beyond the limits of national jurisdiction.

The principle imposed an obligation on the states to exercise their right of the exploitation of the endowed natural resources without causing environmental damages. Interestingly, the principle leans toward a state-centric approach like the principle of sovereignty over natural resources. One may reasonably assume that, it is because of the preferential treatment which the states enjoy under the international law.

The apparent danger of this approach is based on the faulty assumption that most of the environmental damages occur between states. The reality is most of the environmental damages occur within the state. Therefore, while there are pertinent needs to protect the interstate environmental damages, there are equally demanding obligations to devise intrastate policies preventing environmental damages. 

The environmental challenges brought by the increased exploitation of natural resources escalated notwithstanding a wake-up call principle contained in the Stockholm declaration. As pointed out earlier, there were competing interests. On the one hand, the need to protect the environmental damages caused by the exploitation of natural resources and on the other hand, the quest for the exploitation of natural resources as a legitimate means to attain the social and economic development.  Therefore, the Stockholm Declaration partly attempted to but could not ameliorate all the environmental challenges. Therefore, a common approach guided by consultations and cooperation was required in order to prevent the disputes over the use of internationally shared natural resources.[49]

Safe for the hitherto mentioned international treaties, there also exist a plethora of environmental of environmental agreements concluded at the Regional level. These treaties includes among others, the African Charter on Human and Peoples Rights,[50] the African Union Treaty Establishing the African Economic Activity relating to natural resource, energy, environment and control of hazardous waste,[51] and the Convention for Cooperation in the Protection and Development of the Marine and Coastal Environment of the West and Central African Region (The Abidjan Convention). Although, there exist many of such treaties, just one has relevance to oil and gas development.

At the national level, there also exists a surfeit of Laws including inter-alia the Cameroonian Constitution, the Petroleum Code, and the Gas Code. The Cameroonian Constitution is the highest law of the Land of Cameroon. The reunification of the two Cameroons to form the Republic of Cameroon on the 20th of May 1972 led to the adoption of the 1972 Constitution of the United Republic of Cameroon. As such, the Cameroonian Constitution which was promulgated in 1972 although amended several times forms the basis of the current Cameroon Constitution. On the 18th of January 1996, the Cameroonian National Assembly passed Law No. 96/06 which amended the Constitution of 2 June 1972.10 In April 2008, the Cameroonian National Assembly passed Law No.2008/001 of 14 April 2008 to amend and supplement some provisions of Law No. 96/06 of 18 January 1996 to amend the Constitution of 2 June 1972.[52]

The Cameroonian Constitution doesn’t mention much about Natural resources and oil and gas in particular. This notwithstanding, the Preamble of the Constitution provides that, ‘We the people of Cameroon resolve to harness our natural resources in order to ensure the well-being of every citizen without discrimination, by raising living standards, proclaim our right to development as well as our determination to devote all our efforts to that end…’ The Preamble of Cameroons Constitution which is considered as part and parcel of the Constitution[53] provides that oil and gas  resources be used for the wellbeing of all Cameroonians.

The State is therefore bound as per the Preamble of the Constitution to use the proceeds of oil and gas to cater for the wellbeing of its citizens. Knowingly that oil and gas operations comes along with some environmental vices, oil and gas operators must as a matter of fact adhere to environmental norms. This will go a long way to protect the wellbeing of all citizens.

3.2.3.2. The Petroleum Code

Oil exploration in Cameroon started way back in 1947 during the colonial period leading to the discovery of its first commercial deposits in 1972 in the Rio del Ray Basin. This notwithstanding, it was only in 1999 that Cameroon enacted its first Petroleum Code. Prior to the enactment of the 1999 Petroleum Code, the oil and gas sector was governed by the 1964 Mining Code[54] which was supplemented by the 1978 Law.[55] The coming to effect of the 1999 Petroleum Code was therefore the output of encouraging efforts by the Cameroonian legislator to regulate the oil and gas sector of the country.

The Cameroonian Petroleum Code which was enacted on the 22^nd of December 1999 aimed at promoting Petroleum operation s throughout the national territory in the Upstream Gas sector. It lays down several conditions for hydrocarbons prospection, exploration and transport. It also governs the legal, fiscal, customs and exchange schedule of Petroleum operations and determines the rights and obligations relating to Petroleum operations.[56] Specific provisions of the Petroleum Code regulates oil and gas activities in Cameroon. It also provides for adherence to environmental norms by petroleum operators. These provisions are analyzed in detail hereunder.

It is therefore on the above premise that sections 4 of the Petroleum Code provides that, Natural persons or legal entities, including the owners of the surface area, may only undertake Petroleum operations if previously authorized so to do by the State.  Obtaining authorization from the State is thus a condition Sine qua Non for natural persons or commercial companies to carry out petroleum operations.

As enshrined in sections 5(1) of the Petroleum code, the state reserves the right to undertake Petroleum operations either directly or through duly mandated government bodies or units. It may also authorize commercial companies to carry out Petroleum operations in furtherance of a Petroleum contract entered into between them and the State.[57] Going by the provision of sections 4 and 5 of the Petroleum Code, it can be said with confidence that Natural persons and corporate bodies can only carry out oil and gas operations after obtaining permission from the state.[58] This can be done by way of a Petroleum Contract.

With respect to environmental issues, the Petroleum Code obliges the holder of a petroleum contract to conduct in all circumstances in such a way that will conserve natural resources and the essential characteristics of the environment and the ecosystem.[59] Since operations associated with the exploration and exploitation of oil gas has the potential to damage the environment, the contract holder is oblige to undertake an environmental impact assessment prior to the commencement of activities.[60]

This assessment permits the oil company to evaluate the direct and indirect consequences of and the petroleum activities on the ecological equilibrium and on the social life of local inhabitants. Companies definitely go beyond the legal obligation so as to reassure the local communities that oil exploitation will benefit them. Various categories of Petroleum Contracts have been analyzed hereunder.

The Role of International Law on Oil and Gas Governance

 International law has played a decisive role during the evolution of interstate natural resource sovereignty and governance. However, there is a call for setting of international rules, which govern the activities of multinational companies in the hosts states due to cross border investments and the mobility of capital across jurisdictions.

Today, almost every state is in some way part of the international order consisting of a corpus of international documents and interstate treaties. In fact, many countries and ours in particular give priority to international law in relation to domestic laws, thereby reducing their sovereignty in classical sense.[61] On this basis, the Cameroonian Constitution[62]  provides in its articles 45 that, Duly approved or ratified treaties and international agreements shall follow their publication, override national laws, provided the other party implements the said treaty or agreements. Going by the provision of the Cameroonian Constitution, international laws on oil and gas governance takes precedence over domestic laws. One of such International Conventions is the Stockholm Declaration. Its principle 21 provides that, States have, in accordance with the charter of the United Nations the principles of international law, the sovereign right to exploit their natural resources pursuant to their own environmental and development policies, and the responsibility to ensure that activities within their jurisdiction or control do not cause damage to the environment of other states or of areas beyond the limits of national jurisdiction.

Cameroon has a plethora of laws aimed towards the governance of oil and gas resources. These domestic laws enjoin oil and gas operators to carry out their activities in an environmentally friendly manner. However, in practice, most oil and gas dealers have recurrently failed to adhere to these norms. In a bid to further strengthen her domestic laws, Cameroon has adhered to various international norms on oil and gas. These Conventions not only concretize our domestic laws but has also improved on the lapses in our domestic laws.

Conclusion and Recommendation

Governance has become one of the most fashionable concepts in the past. It has become a part of many studies, papers, declarations and recommendations in a wide range of subjects at all levels of society. The overall state of governance in the country is considered poor according indexes of government quality. Various measures of governance have been devised in the past decade to access governance quality, that is, the institutional structure and decision-making environment at the political and economic level.

The oil and gas industry of Cameroon still faces a myriad of Governance issues that needs urgent attention. Curtailing the hurdles identified is of utmost importance. Despite the measures adopted by the Cameroonian in the management of oil and gas resources in the country, several proactive measures need to be adopted. The need to adopt and implement international measures on oil and gas governance is of utmost importance.

After examining the role of international law in oil and gas governance and the challenges that affects this governance in Cameroon, it becomes imperative to make some recommendations. Updating and revising the legislations, reviewing the license of the oil companies and reviewing the fines will go a long way in ensuring compliance, even though the government cannot systematically or frequently monitor these sites.

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[1] Boadway Robin and Keen Michael, Theoretical Perspective on Resources Tax Design, in Philip Daniel et al (ed.), The Taxation of Petroleum and Minerals: Principles, Problems, and Practice, London and New York, Routledge, (2010), p. 13; See also, Vinuales Jorge, E., Foreign Direct Investment International Investment Law and Natural   Resources Governance, in Morgera Elisa and Kalovesi Kati, (eds.), Research Handbook on International Law and Natural Resources, Cheltenham, Edward Elgar Publishing Limited, (2016), p. 33.

[2] Gauther B, &  Zaufack A, “Governance and Oil Revenues in Cameroon” (2019), Revenue Watch Project, OxCARRE, Oxford University,. Pp. 1 – 24:8.

[3] Ibid.

[4] Ibid.

[5] Dolzer Rudolf, Permanent Sovereignty over Natural Resources and Economic Decolonization, Human Rights Law Journal 7 (1986), Pp. 217 – 234: 217.

[6]  Alao Abiodun, The Tragedy of Endowment: Natural Resources and Conflict in Africa, Rochester, University of Rochester Press, (2007), pp. 120 – 145; See also, Cohen N., The Curse of Black Gold: Oil is Bad News for a Country; Far from Bringing Prosperity, It is the Harbinger of Poverty, Malnutrition and oppressive Government, New States-Man, 2 June (2003); See also Date-Bah S.K., Rights of Indigenous People in Relation to Natural Resources Development: An African Perspective, 16 Journal of Energy and Natural Resources Law, (1998), pp. 389 – 395.

[7] Africa Progress Panel, Equity in Extractives: Stewarding Africa’s Natural Resources for All, Africa Progress Report, (2013), pp. 46 – 50, noted that foreign direct investments increased as compared to the previous decade, for instance, the major global mining companies increased their investments from USD315 billion in 2007 to USD 480 billion in 2011.

[8]  Dufresne Robert, The Opacity of Oil, Oil Corporations, Internal Violence and International Law, 36 New York University Journal of International Law and Politics, (2003- 2004), pp. 331 – 354;

[9] Okowa Phoebe, N., Natural Resources in Situation of Armed Conflict: Is there a Coherent Framework for Protection? (2007)  p. 246.  Arguing that the concept of permanent sovereignty over natural resources has a particular resonance beyond decolonization. It is quite unfortunate that in international law, the governments are not required to be accountable to their people on the use of natural resources. Thus, it is further argued that displacing governments autonomy in determining the destiny of their population is clearly dangerous

 

[10] Miranda Lilian Aponte, “The Role of International Law in Intrastate Natural Resource”, (2012) p. 794.

[11] Tariq M., “Concept of Governance an Overview” (2020), Available at www.researchgate.net/publication/340535981-concept-of-governance-an-introduction&ved (Accessed on the 02/07/2021).

[12] Ibid.

[13] Waleola J. Ekundayo., “Good Governance Theory and the Quest for Good Governance in Nigeria” (2017) International Journal for Humanities and Social Science, Vol. 7, Pp. 154 – 161: 154.

[14] Sheng, Y.K. What is Good Governance? (United Nations Economic and Social Commission for Asia and the Pacific UNESCAP) Available at http:www.unescap.org. (Accessed on the 5/05/2021).

[15] Gauther B, & Zeufack A., “Governance and Oil Revenues in Cameroon” (2009), Revenue Watch Project, OXCARRE, Oxford University, Pp. 7-24.

[16] World Economic Forum (2007) The Global Competitiveness report 2007-2008, Geneva Switzerland.

[17] Ibid.

[18] Ibid

[19] Patricia I., Four Policy Actions to improve Local Governance of the Oil and Gas Sector., Available at https://journals.openedition.org/poldev/2227&ved (Accessed on the 03/07/2021).

[20] Ibid.

[21] Damilola S. Olawuyi., (2018) Supra.

[22] Tamfu, S. Perspectives of the Petroleum Extraction and Production Sector in Cameroon, (Exploration Manager, SNH, Presented at Cameroon EITI Workshop, 22^nd September 2008, Yaounde, Cameroon).

[23] Down from close to 80% in 1985.

[24] World Bank., A New Resolve to Sustain Reforms for Inclusive Growth (2006), Country Economic Memorandum, 29268, The World Bank, Washington DC.

[25] Land: an Achilles’ heel in Cameroon’s 2019 Petroleum Code, Available at https://www.landcam.org/en/land-achilles-heel-cameroons-2019-petroleum-code-&ved (Accessed on the 05/04/2021).

[26] Bikas C., & Wilfred A., (1990) et al. Supra.

[27] Article 55 of the United Nations Charter, 1945

[28] Weston, Burns, H., The Charter of Economic Rights and Duties of States and the Deprivation of Foreign-Owned Wealth, (1981), pp. 437 – 475

[29]  Barbieri Michele, Developing Countries and their Natural Resources, (2009) p. 9; See also Bulajic Milan, Principles of International Development Law, Leiden, Martinus Nijhoff Publishers, (1986), p. 108

[30] Award on the Merits in Dispute between Texaco Overseas Petroleum Company/California Asiatic Oil Co. and the Government of the Libyan Arab Republic (Texaco v. Libya), 17 ILM 1, paras. 87-9

[31]  Penrose, E et al., Nationalization of Foreign-Owned Property for a Public Purpose: An Economic Perspective on Appropriate Compensation, The Modern Law Review, vol. 55, no. 3, (1992), p. 355; Chatterjee, S.K., The Charter of Economic Rights and Duties of States – An Evaluation after 15 Years, The International and Comparative Law Quarterly, vol. 40, no. 3, (1991), p. 674

[32] OAU Doc. CAB/LEG/67/3 rev. 5, Uan. 7-19, 1981), reprinted in 21 I.L.M. 58 (1982).

[33] Oloka-Onyango John, Reinforcing Marginalized Rights in an Age of Globalization: International Mechanisms, Non-State Actors, and the Struggle for Peoples’ Rights in Africa, 18 American University International Law Review, (2003), p. 890.

[34] Barbieri Michele, Developing Countries and their Natural Resources, (2009), p.17; Fuentes Ximena, International Law- Making in the Field of Sustainable Development: The Unequal Competition between Development and the Environment in Schrijver, N.J., and Weiss Friedl (eds.), International Law and Sustainable Development – Principles and Practice; Leiden; Martinus Nijhoff Publishers; (2004), p. 29;

[35] Kiwanuka Richard N., The Meaning of “People” in the African Charter on Human and Peoples’ Rights,(1988), p. 95

[36] Duruigbo Emeka, Permanent Sovereignty and Peoples Ownership of Natural Resources in International, (2006).p. 46; See also Kofele-Kale Ndiva, Patrimonicide: The International Economic Crime of Indigenous Spoliation, Vanderbilt Journal of Transnational Law, (1995), p. 56.

[37] Article 3 of the UN Convention on Biological Diversity of 1992.

[38] article 1(b)(i) of the United Nations General Assembly Resolution 523 (VI)of 1952

[39] article 1(b)(ii) of the United Nations General Assembly Resolution 523 (VI) of 195

[40] Proviso under article 1(b)(ii) of the United Nations General Assembly Resolution 523 (VI) 1952

[41] Warden-Fernandez Janeth, The Permanent Sovereignty over Natural Resources: How it has been Accommodated within the Evolving Economy, The Centre for Energy, Petroleum  and Mineral Law  and Policy (CEPMLP) 2000, p. 3.

[42]  the preamble of the United Nations General Assembly Resolution 626 (VII) of 1952 on the Right to Exploit Freely Natural Wealth and Resources

[43] See article 2 of the United Nations General Assembly Resolution 626 (VII) of 1952 on the Right to Exploit Freely Natural Wealth and Resources

[44] Ibid

[45] ibid

[46] Thornton, J. & Beckwith, S. Environmental Law, (2004), p. 29; Rachel Carlson’s Silent Spring, Boston, Houghton Mifflin, (1962), cited in Schrijver, N.J., Development without Destruction, (2009), p. 48, arguing that there were long-term effects of pesticides on birds and other wildlife, especially DDT; excessive economic growth; tanker collisions and oil spills; contamination of water; discharges of harmful chemical waste; testing of nuclear weapons; the pressures of a growing world population; increased pollution; wasteful consumption patterns; and other forms of unrestricted use of the world’s natural resources.

[47] See Report of the United Nations Conference on the Human Environment, General Assembly document A/CONF.48/14/Rev.1, 16 June 1972; text reproduced in International Legal Materials (ILM) 11 (1972), pp. 1416–1420; See also Report of the United Nations Conference on the Human Environment, Action Plan for International Cooperation on the Environment; UNGA resolution 2997(XXIX), 15 December, 1972, Institutional and Financial Arrangements for International Environmental Cooperation, on the establishment of United Nations Environmental Programme (UNEP).

[48] Schrijver N.J., Development without Destruction, (2009), p. 50; See also Schrijver, N.J., Sovereignty over Natural Resources, (1997), p. 123.

[49] Schrijver N.J., Sovereignty over Natural Resources, (1997), p. 130

[50] See Sections 16 (1), (2) & 24 of the African Charter on Human and Peoples’ Rights (Bangul, 27 June 1986)

[51] See Articles 56 – 59 of the African Union Treaty

[52] Terence Onang E., “Modern Law and Local Tradition in the Forest Heritage Conservation in Cameroon: The Case of Korup” PhD Thesis, unpublished, Brandenburg University of Technology in Cottbus, 2002, P.53

[53] Article 65 of the Cameroonian Constitution

[54] Law No. 64-LF-3

[55] Law No. 78-14

[56] Sections 2 of the Petroleum Code

[57] Sections 5(2)

[58] It’s only the state that can grant such permission because it exercises sovereign ownership rights over petroleum resources

[59] Section 82, Ibid

[60] Section 83, Ibid

[61] Dragana N., & Dusan J., “Role and Importance of International Agreements in Regulating International Relations in Modern Conditions”, (2018), Scientific Review Article, Vol. 64, Pp.89 – 102: 90.

[62] The Law No. 96/06 of the 18^th of January 1996 to institute the Cameroonian Constitution as amended.