BP’s Russian roulette

Here is my latest article published in IBA Global Insight:

In January, BP and state-owned Russian energy company Rosneft shocked the world by signing a US$16bn share swap deal. The two companies intend to jointly exploit oil and gas reserves in Russia’s Arctic shelf and make Rosneft the largest single shareholder in BP. The deal, which will also see BP increase its holdings in the former assets of Yukos oil company, occurred only a matter of weeks after Yukos’ former CEO, Mikhail Khodorkovsky, was sentenced to a further six years in prison.

A stark reminder of BP’s recent past also came shortly after, when the company reported a loss of US$4.9bn – mainly due to US$40.9bn for charges relating to the Gulf of Mexico oil spill – making 2010 its first year of losses for 20 years. The tie-up therefore not only raises many questions about the viability of a British – Russian exploration operation, but also poses questions about the future of BP and the oil and gas industry as a whole.

Published on 04-04-11. Read on here

Lands of Opportunity: Latin American exploration market

Here is my first article published in IBA Global Insight:

The drama surrounding the rescue of 33 miners in northern Chile has highlighted the great potential in the country’s mining industry as well as the Latin American exploration market.

Latin America has long been known as a mineral rich continent. Nevertheless, periods of economic, political and social instability have discouraged foreign companies from investment. On 13 October, 33 miners were rescued after being trapped for 66 days in the collapsed San José mine in northern Chile. The story captured worldwide attention and turned what could have been a major blow for the country and its mining industry into a global success story. Both the rescue and the euphoria it provoked are telling of the great potential and interest in both Chile and the Latin American market as a whole.

Published on 15-02-11. Read on here

Brazil elects Dilma Rousseff as first female president

After weeks of speculation, Dilma Rousseff has been elected president of Brazil. 62-year-old Ms Rousseff has never held elected office before but was voted in yesterday as the country’s first female president.

After a bitter fight to the end in which both sides accused one another of corruption and misconduct, Rousseff, of the governing Working Party, won 56% to 44% against her rival José Serra, a candidate for the Social Democrat’s Party.

She was always tipped as the ideal successor of outgoing President Luiz Inacio Lula da Silva and enjoyed his support throughout the campaign. He was always praised as an ambassador of the poor and leaves office after two terms with a sky-high popularity rating.

In her victory speech, Rousseff announced that one of her first priorities would be to “eradicate poverty” and pull 20 million Brazilians out of poverty. She hopes to build on Lula’s achievements, since under his government the country witnessed increased minimum wage, increased per capita income and reduced unemployment.

Rousseff’s victory is also a huge victory for the left across Latin America. Washington is unlikely to welcome the news, since, in spite of efforts to cooperate more closely with Latin America than his predecessor, Obama’s administration has continued Bush’s “rollback” strategy against the rise of the leftist governments in the continent over the past decade.

On another level, her victory also points to the ascendancy of female politicians throughout the continent. Of the major countries alone, Argentina has already had two female presidents, Isabel Peron, the first woman to become president of a republic, from 1974 to 1976, and Cristina Fernandez de Kirchner, who has been in power since 2007. In Chile, Michelle Bachelet ruled from 2006 until March 2010. Now Brazil has its first female president.

Does this spell the end for kirchnerismo?

The sudden death of former Argentine president Néstor Kirchner last Wednesday was a shock to the nation and poses many questions for the future of Argentine, and indeed, Latin American politics.

Swept into his role as president by default in 2003, Kirchner became Argentina’s leader at a particularly difficult time in the country’s political and economic landscape: his three predecessors had come and gone in a five-year period, unemployment had risen to above 21% and the economy, buckling under the pressure of sovereign default on $95bn and colossal devaluation, had well and truly collapsed.

Although he certainly benefited from several inherited policies, Kirchner faced some of the country’s economic challenges head on and became a veritable symbol of Argentina’s economic recovery. He was determined to defy both Washington and the International Monetary Fund’s economic and security policies which, in his opinion, had been the root cause for the country’s economic collapse. In doing so, he prioritised the revival of Argentina’s economy over the demands of foreign creditors. His gamble paid off, stimulating economic growth by some 8% in 2008 and brought over a quarter of the population back above the poverty line.

He also earned support from the left for reopening human rights trials against amnestied officers from Argentina’s dictatorship from 1976-1983. However, he was a deeply divisive figure, much loved by the poor but many of his Peronist policies and allegations of corruption and embezzlement made him unpopular with the conservatives and the upper classes. When he decided to stand down in 2007, he chose his wife Cristina Fernández de Kirchner as his successor. However, Néstor remained active in politics, he became the chairman of the Peronist party, the secretary general for the South American regional grouping, Unasur and his wife’s chief political strategist. It was widely speculated that Néstor himself would stand again in 2011 and that the Kirchners would continue to alternate the presidency for the good part of a decade.

In spite of any controversy, together the Kirchners undoubtedly represented and lived up to the legend of Argentina‘s original “power couple” Juan and Eva Perón. Those that say that his death has created a power vacuum in Argentina are wrong, if anything the power vacuum lies in Peronismo or even kirchnerismo itself. Although a skilful and experienced politician in her own right, the death of her key political confidante will pose problems for her future leadership and weaken her hold on power. Her party already suffered a major setback in the midterm elections last year when it failed to secure a victory in the province of Buenos Aires, a traditionally Peronist stronghold.

Her husband’s death may win her back support in the form of sympathy, but it has also weakened her party irremediably as an internal power struggle rages on. She now has several months to decide if she wishes to opt for a second term. Given the tumultuous nature of the country’s recent political history, during which few of her predecessors succeeded in serving a second term, it is important that she maintains the stability that both she and her husband have created in the Argentine political landscape.

Outside of Latin America, it is perhaps hard to fully comprehend the gravity of Kirchner’s sudden death and its impact on Argentina and the continent as a whole. Often dubbed the “Clintons of the South”, perhaps the most apt modern-day comparison would be if one of the Clintons were to die whilst still politically active.

Kirchner was extremely popular throughout Latin America, winning much support from leftist nations such as Brazil, Venezuela, Ecuador and Bolivia. For Venezuelan President Hugo Chávez, Kirchner’s death marks the loss of one of his most influential political allies in the region and will surely make things more difficult for him amidst waning popularity, having won his country’s recent elections with a much reduced majority. Although the left is prospering in some countries, if Dilma Rousseff’s victory in the Brazilian elections is anything to go by, certainly Kirchner´s death will be a major stumbling block for the future of the left across Latin America.

The dramatic rescue of Los 33

In probably one of the most nail biting rescues in modern-day history, the world watched rapt as the 33 Chilean miners reached the surface safely yesterday.

In spite of allegations earlier this week that some broadcasters were providing excessive coverage of the rescue, the age of live internet streaming and Twitter succeeded in uniting support worldwide for the Chilean miners and their families.

The miners have been trapped underground for over two months after a rockfall caused a tunnel at the San José mine to collapse on 5 August. The miners have survived by receiving food, water and other supplies down a borehole.

Many of the men’s family and friends set up camp near the mine and the media has been covering events closely. It is remarkable how the lives of these 33 ordinary men have now become public knowledge, not only on a national, but an international scale.

President Sebastián Piñera was present from the very beginning of the excavation operation and has received a number of phone calls from heads of state around the world. On the telephone with David Cameron, he thanked the British Prime Minister for his call. “Let’s share a cup of tea next week when I am in London,” he added, smiling.

As the operation proceeded successfully, the air of tension gradually changed to excitement as we were greeted with scenes of jubilation and it seemed increasingly likely that all of the miners would be rescued and brought to safety. “Vamos, Vamos, Vamos!” (Go, go, go!) yelled Mario Sepúlveda, the second miner to be rescued, as he neared the surface. He handed out stones to the rescue team as souvenirs.

Despite a dent in the “Phoenix” capsule’s door, the elaborate operation progressed well and mining minister Laurence Golborne reportedly said that the rescue had gone much faster than expected. The last miner, 54-year-old Luis Urzua,  emerged at the top of the rescue shaft at 21 55 yesterday local time.  The last rescue worker Manuel González was lifted to safety at 00 55 this morning local time. The entire operation took just over 24 hours to complete – less than half that originally expected.

There are of course concerns over the men’s health and psychological well-being after being stuck underground for such a long period of time. They are due to remain in the nearby Copiapó hospital for at least 2 days as doctors run a number of medical and psychological tests on them. Many of the men are believed to be suffering from severe dental problems.

It’s been a tough year for Chile, having suffered an earthquake registering 8.8 on the Richter scale and the large-scale Mapuche hunger strike. So it’s about time that the country had a reason to celebrate.

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