Leer en Español
GUSTAVO PETRO’s environment minister, Susana Muhamad, participated in Shell’s public relations team to license a gas project in Iran in the South Pars fields in the Persian Gulf Sea, according to documents reviewed by El American. This is a controversial project that even the U.S. Congress itself opposed at the time.
Since before his election, Petro promised to lead an “energy transition” that has resulted in an attack on the hydrocarbon industry over integrating new renewable energy into Colombia’s energy matrix. The government has revoked licenses to carry out fracking pilots in the country, refuses to grant new exploration permits, and wants to impose a special tax on “extraordinary” oil exports. Uncertainty reigns among the unions and companies in Colombia’s mining-energy sector.
As political figures of the so-called transition, the president has appointed two philosophers at the head of two key ministries: Irene Vélez in mines and energy, and Susana Muhamad in environment.
The focus of the Colombian press has been on Irene Vélez, who stands out for her stumbles with the press, her defense of the pseudo-science of degrowth at a mining congress, and for her declared intention to “learn as she goes along”.
Susana Muhamad, who was Petro’s environmental secretary when he was Mayor of Bogotá, has managed a more low profile but maintains a position just as strong as that of the president himself on hydrocarbons.
In a recent public hearing, Muhamad stated that “geologically Colombia is not an oil country, nor a country of large gas deposits. Not only in terms of environmental impact, but also in terms of development model, fracking is not convenient for Colombia, what fracking does is to lock us back into this unsustainable energy matrix.”
La técnica de fracturación hidráulica al suelo (fracking), es una matriz energética insostenible; Colombia NO es un país petrolero ni cuenta con grandes yacimientos de gas. Por eso hoy ratifico que #ElCambioEsSinFracking . pic.twitter.com/ygIFL29RZ6
— Susana Muhamad (@susanamuhamad) September 15, 2022
Susana Muhamad, however, does not mind the idea of oil and gas extraction, but outside Colombia. Before entering politics and during her formative years, the current environment minister worked for one of the largest oil and gas conglomerates in the world, Royal Dutch Shell, or Shell for short, a company where she stayed for more than 7 years and where she acquired a wide range of international experience structuring “ecoprojects” in countries such as Nigeria, Qatar, and Iran.
Susana Muhamad’s career at Shell
Muhamad tells in her LinkedIn that her career in the hydrocarbon industry started in 2003 as “Analyst Shell Group Business Principles Assurance Process”, seconded by the Danish Institute for Human Rights. In this position, (which she was to serve for nine months), she was involved in “the research of best-case practices and limitations to the implementation of human rights for business” and directly advised Shell’s board of directors on the group’s “status of business principles.”
In 2004, Muhamad was promoted to Shell Group sustainable development consultant, a position in which she advised the oil group “about how to implement the social and environmental standards and processes in the development of capital projects.”
As a Shell consultant, Muhamad participated in “Game Changer”, an innovation program “to create more integrated gas & oil projects to local political, social and environmental context,” which involved three years of research that culminated in a $30 million eco-design scheme to be implemented in eight Shell projects around the world.
The minister also notes that in her time as a consultant to Shell she developed “methodologies to integrate Human Rights and conflict assessment in the Shell’s internal procedures for capital projects development”. She goes on to mention that she participated in the environmental and social impact study for the construction of a natural gas plant in Iran and supported the site selection process for another gas plant in Nigeria. Muhamad does not specify anything else about these two projects in her resume nor does she make any mention of another of her projects, in Qatar.
In an interview with Colombian journalist Yamid Amat, the Minister of the Environment mentions that during her time at Shell she got to know South Africa, Nigeria and Iran, but only lasted five years as she retired as soon as she realized that Shell decided to invest “the money for innovation in non-conventionals”. During her time at Shell, Muhamad says she founded a chapter of the Polo Democrático (a left-wing party in Colombia) in the Netherlands in 2006.
More illustrative of her career at Shell than Muhamad’s resume is her thesis for her Master of Philosophy degree in Sustainable Development, Planning and Management at the University of Stellenbosch titled: The Global Corporation and its Role as a Source of Innovation for Sustainable Development: Beyond Corporate Social Responsibility – An Experience of Innovating for Sustainability within the Royal Dutch Shell Group.
Environment Minister Susana Muhuamad’s thesis and Shell’s agenda in Iran
Susana Muahamad’s thesis fully embodies Shell’s sustainability agenda at the time. In 1996, Shell was embroiled in a scandal following allegations by several human rights organizations accusing the company of complicity in the murder of Nigerian activist Ken Saro-Wiwa and 8 other Ogoni tribal leaders by supplying the Nigerian army with vehicles and ammunition that were later used for the execution of the African activists on November 10, 1995.
As a consequence of the reputational blow, Shell was forced to make an institutional reform in 1997 to regain the lost confidence of its investors. In short, Shell’s new responsibility framework sought to give the company a friendlier face and incorporated the concept of sustainable development among its principles.
The oil company’s new policies implied mitigating the environmental and social impact of its operations, investing in biofuels, or financing social, productive or ecological programs in the communities near its projects, among many other strategies aimed at recovering Shell’s image before investors and the U.S. authorities, which in 2009 found the company guilty of facilitating the murder of the Ogonis activists.
In the midst of the conglomerate’s corporate transformation, Muhamad comes to work on the development of the aforementioned “Game Changer” program that seeks to incorporate “innovative initiatives” of all kinds into Shell’s portfolio.
Although Muhamad claims that she left Shell when she learned that money from the Group’s innovation pipeline was invested in “non-conventional” energy, she herself acknowledges in her thesis that the Game Changer program allocated money directly to the company’s business lines and cites as an example “gas and power exploration and production” among other programs in the “Group wide domains, meaning those [projects] that transcend a specific business but can make a radical difference at Group level.”
Muhamad led one of the Game Changer projects, the design of an ecovillage. In her thesis, the environment minister says that the idea came about in 2005, when she was consulting fishing communities off the coast of Nigeria to determine the most appropriate place to build a gas plant. Among the places she visited, she had the opportunity to visit a site with “undeveloped beaches that held a large tourism potential”, which reminded her of an ecovillage she lived in for more than a year in South Africa and whose model she wanted to replicate with Shell.
Aware of the lack of infrastructure and public services in Nigeria, Muhamad determined that such a tourist site would not be possible, so she decided to adapt her ecovillage idea to something more digestible for Shell executives: “Create a high profile eco-resort to host Shell employees in the area and inspire a different model of development for the government and surrounding communities.”
After a year of negotiations and rounds of capital, Muhamad succeeded in interesting Shell executives to allocate budget for her “eco-resorts”. Although her instance in Nigeria inspired this project, for “organizational reasons”, she states in her thesis, the first pilot of her eco-village had to be carried out in Qatar.
The pilot in Qatar consisted of the construction of a residential complex of 800 houses to house the staff of the oil and gas projects in the area in alliance with another giant in the sector, Exxon Mobil.
A second pilot project in Iran is briefly mentioned by Muhamad in her thesis, which consisted of developing “a sustainability concept for the future construction camp and the resettlement of a fisher village.” Muhamad does not mention the Iranian natural gas plant referred to in her resume; her thesis was submitted in November 2006 and published in March 2007.
Royal Dutch Shell’s business in South Pars
The “organizational reasons” for the relocation of the Muhamad “eco-resorts” pilots outside Nigeria are nothing more than a $4.3 billion deal between Repsol and Shell with Iran, which was sealed in 2007 to develop stages 13 and 14 of the gas project in the South Pars fields, as well as the construction of a liquefied natural gas (LNG) plant.
The South Pars fields have the largest proven natural gas reserves in the world. They are located in the Persian Gulf Sea, shared by Iran and Qatar.
For years Shell had been trying to build a relationship with the Iranian authorities in order to drill the juicy fields in the Persian Gulf, and Muhamad’s “eco-fishing village” program fit into this grand public relations campaign between the oil conglomerate and the ayatollah’s regime.
Due to Washington’s sanctions against Tehran, the project to build an LNG plant in South Pars was the only such infrastructure development Shell had in Iran during Muhamad’s time with the company.
El American contacted Muhamad to explain her role in the development of the South Pars Stage 14 LNG plant, but she did not respond to a request for comment.
Susana Muhamad never saw the results of her environmental impact studies materialize, as the LNG plant would not be built by Shell.
Repsol and Shell’s agreement with Iran generated discomfort in the U.S. Congress itself, which warned that if the investments in the Persian Gulf were executed, there would be consequences for the oil companies, based on the Iran Freedom Support Act, which authorizes sanctions for any company that invests more than $20 million in the Iranian hydrocarbon sector.
In the end, Iran ceded the exploitation rights of stages 13 and 14 of the South Pars fields to the engineering firm Katham al-anbiya belonging to the Islamic Guard Revolutionary Corps, a branch of the Iranian army catalogued as a terrorist organization by the US government.
Susana Muhamad retired from Shell in 2009, before the Iran deal failed. She returned to Colombia where she dedicated herself to academia and activism that would lead her to land in the office of then Mayor Petro in 2012 as an advisor. Six months later she would be promoted to Bogotá’s environment secretary.
Interestingly, Muhamad’s experience in Shell makes her more suitable to occupy the Ministry of Mines and Energy than her counterpart Irene Vélez, who has no experience in this position and many accuse her of being a political quota of VP Francia Márquez.
Promoting a social responsibility agenda in the private sector is not a controversial effort; however, it is striking that a high-level official within the Petro Administration, with clear progressive affinity, has been part of a scheme to greenwash an agreement between an oil multinational and a theocracy that to this day considers it fair to stone a woman for going out in the street with her hair uncovered.
In fact, in recent days, the world has been watching closely as hundreds of thousands of women in Iran take to the streets today and burn their hijabs in protest at the vicious murder of Mahsa Amini by the police for the “crime” of going out in public with her hair uncovered.
Economist, writer and liberal. With a focus on finance, the war on drugs, history, and geopolitics // Economista, escritor y liberal. Con enfoque en finanzas, guerra contra las drogas, historia y geopolítica