Letters

Use Lokichar oil row to refine resource rules

loki

The standoff over transportation of crude oil from South Lokichar, Turkana to Mombasa port requires a sober approach if Kenya were to avoid the resource curse common to some oil-rich countries in Africa.

Whereas the oil prospect is inspiring, lack of clarity on social, political and economic interests between the national and county government on the one hand, and community on the other, is our main undoing.

What are the prospects of other unexploited natural resources like coal deposits in Kitui, wind power project in Marsabit, and of course developed ones like hydroelectricity generation along the Seven Fork dam?

Whereas there should be equitable sharing of revenues generated in far-flung areas between national and custodian county authorities, there’s a need for clarity on applied modalities.

The Constitution requires that not less than 15 per cent of recently audited accounts of revenue received by national government be shared with the counties.

Further, as an affirmative action towards marginalised areas, equalisation fund was established. Permitting county specific negotiated models is unsustainable and can elicit serious social-political and economic ramifications.

Increased agitation for more resources by devolved units regardless of their absorption capacities and prudence is suspect. By encouraging such, we are setting ground for the tragedy of commons, a situation where each resource-hosting community will be pursuing their own self-interest even if against the national good.

In the case of Lokichar oil, the government seems to have adopted the Chad petroleum revenue management concept where 75 per cent of the proceeds belong to the national government, 20 per cent for county and five per cent for local community.

This model might trigger interest on other public commercial establishments elsewhere. Mombasa port is a recent case.

What then does this development portend for Kenya? What policy strategies and controls are in place?

In Mexico, five per cent of oil revenues extended to host community is used to rehabilitate the environment. The Chad model is silent on this aspect and so is the Lokichar deal.

Lokichar community has, therefore, cast their nest wider with a proposal for the community share of the cash to be wired through individual accounts. The practicality of this proposal is ambiguous.

Such ambiguity reveals absence of public participation from the start. The Lokichar incident might just be a tip of the iceberg. The rest of the country is watching. Certainly, ‘Wanjiku’ is getting more enlightened.

All the same, revenue sharing at community level should be guided by a well thought-out framework, absence of which invites the ‘me-too’ mentality.

The ward, being the lowest planning administrative unit, is best placed as a platform through which community support should be channelled.

Unfortunately, we lack structured revenue absorption mechanism at this level.

Again, communities lack capacity to oversee resource absorption in a prudent, sustainable, accountable and transparent manner.

In short, revenue sharing formulas that target personalities is not only ill-advised but also doomed to elicit emotions.

Exceptional leadership is one that advocates for sustainable development that targets social benefits and promotes growth, equality and stability.