The Chad-Cameroon Petroleum Development and Pipeline Project involved the construction of a 1070 km pipeline to transport crude oil from three fields in southwestern Chad to a floating facility 11 km off the Cameroon coast.  IFC's investment consisted of a $100 million loan for its own account and a $100 million loan syndicated to over 15 commercial banks. 

In October 2011, Groupe de Recherches Alternatives et de Monitoring du Projet Petrole Tchad-Cameroun (GRAMPTC), in collaboration with six other organizations, filed a complaint to the CAO on behalf of local farmers and other community members affected by the pipeline. The complainants highlighted a number of environmental and social issues relating to poverty exacerbation, land pressure and loss of livelihood, land and water pollution, inadequate compensation, and the lack of adequate monitoring and assessment mechanisms. The complainants are located on the Chadian side of the project and their concerns relate to the Chadian project sponsor, the Tchad Oil Transportation Company (TOTCO).

CAO found the complaint eligible for further assessment in January 2012.  During the assessment, the Complainants, affected community representatives and Esso Exploration and Production Chad, Inc. (EEPCI) agreed to engage in a consensual dispute resolution process, and ground rules governing the process were discussed and agreed.  This is captured in CAO's Assessment Report.

Following the assessment, CAO initiated and completed a community awareness program to inform community members and local stakeholders about the agreement to seek negotiated solutions in May 2013.   The CAO mediation team has worked extensively with the parties and more particularly the affected community representatives to ensure they have the requisite capacity to participate in the mediation process. This has included the provision a comprehensive negotiations skills training.  Further, a group made up of moral observers has been formed, consisting of senior clerics representing the main faiths of the region and a Canton leader, to observe and accompany the process.

In April 2013, an official categorized agenda of issues for negotiation and a tentative itinerary was drawn up. Thereafter, plenary sessions were held to discuss the identified five priority areas – i) land use by EEPCI, ii) compensation, iii) access to jobs and in-migration of people, iv) environmental impact and v)insufficient concrete signs of sustainable development. Subcommittees on 1. socio-economic and 2.environment were then formed that operated simultaneously, the former focused on individual and collective complaints/ compensation claims whilst the latter on environmental issues. 

In May 2013, CAO conducted an extensive community awareness program to inform the broader community of the dispute resolution process. Since then, the CAO mediation team has worked extensively with the parties and, more particularly, the affected community representatives to ensure they have the requisite capacity to participate in the mediation process. In addition, a moral observers group, consisting of senior clerics representing the main faiths of the region, was established to help monitor and inform on the process.

Since July 2013, regular plenary sessions have been held to discuss the issues identified in the complaint.  In plenary, the parties shared their knowledge and perspectives about the identified priority sectors. With the CAO acting as facilitator, these meetings gave the consortium an opportunity to detail further how it operates and implements its commitments on the ground. The complainants had an opportunity to share the findings of their field-based studies and household surveys.  Further, future working arrangements were discussed.

Two sub-committees were created to examine the complaints,conduct in-depth field surveys.   The two (socio-economic and environmental) subcommittees operated simultaneously: one focused on individual and collective complaints; the other on environmental issues.

For more than two years, the socio-economic subcommittee examined individual compensation claims and community compensation claims.  The sub-committee examined each individual compensation claim and drew related conclusions. Where necessary, with the CAO acting as facilitator, members of the joint subcommittee visited, repeatedly in some cases, sites where complaints were made to observe the facts and the situations, and identify their exact location.  The sub-committee members then examined and discussed the collected data, and the consortium's databases and archives were used to analyze each specific situation.

Decisions and recommendations about most individual compensation questions that were addressed using this survey-based approach in the field were mutually agreed by the members of the sub-committee.

The subcommittee in charge of community complaints was able to establish a shared diagnosis of community requests related to infrastructure or development, based on information about the consortium’s initial consultation process and about activities implemented to date.

As far as the subcommittee in charge of environment is concerned, experts hired jointly by the parties were able to examine, based on opposing expert reports, various environmental issues raised in the complaint. In one specific case, a specialist was hired to carry-out technical studies and offer an opinion on the best way to address issues raised in the complaint. 

On January 16, 2017, representatives of the NGOs mandated by communities in Chad’s oil producing region and Esso Exploration and Production Chad (EEPCI) signed an agreement.  As per the agreement, a number of points would be  implemented through a Platform.  Information about the agreement is summarized in CAO’s February 2017 Progress Report.   

This Agreement concluded the CAO dispute resolution process. After the Agreement was signed, CAO stayed engaged to monitor the implementation and offer support for implementation challenges. CAO also engaged with the parties in October and November 2018 to reflect on the process and its outcomes. In January 2020, CAO formally closed the dispute resolution process. Issues that were not part of the dialogue process, specifically concerns around security and resource management, were transferred to CAO compliance for appraisal of IFC’s performance. A Conclusion Report summarizing the dispute resolution process and outcomes is available in English and French under "View Documents" below. 

Compliance Process 

In January 2020, following the closure of the dispute resolution process, the case was transferred to CAO Compliance for appraisal of IFC’s performance regarding two remaining issues, which concerned oil revenue allocation and public security. In May 2020, CAO issued its compliance appraisal report, which concluded that an investigation is not merited in relation to these issues. 

In reaching this decision, CAO first notes that the issue concerning allocation of oil revenue in Chad falls outside of the scope of CAO’s compliance review, as mandated by CAO’s Operational Guidelines. Revenue allocation was a responsibility of the government of Chad, and no specific IFC requirements existed for the management of extractive industries revenues at the time the project was approved.

Second, while CAO notes that the security-related impacts raised by the complainants are serious in nature, and while CAO has questions as to the extent of IFC’s supervision in relation to this issue, CAO considers that a compliance investigation would have limited value in this case. At the time when the project was approved, IFC’s E&S framework did not contain specific guidelines regarding security-related risks, and therefore there were no specific compliance requirements for the client in relation to these issues. Moreover, the complainants have reported a marked improvement regarding security issues, as noted in the CAO Dispute Resolution Conclusion Report, and in 2012 IFC exited the project following repayment of the loan. In these circumstances, and according with its Operational Guidelines, CAO decided to close the case.