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Petro-dollars from New Pipeline Pose Challenge for Chad - 2003-10-06

The first tanker with crude oil from a massive pipeline project in Chad is headed for world markets.

The tanker set off Friday from the port of Kribi in Cameroon. It is carrying nearly one million barrels of crude from wells in southern Chad.

The oil fields are linked to Cameroon by a 1,000-kilometer pipeline, partly funded by the World Bank. It can transport 250,000 barrels a day.

The project is expected to bring Chad $2 billion over the next quarter-century. Cameroon is expected to earn $500 million.

A researcher with the U.S.-based aid agency Catholic Relief Services, Ian Gary, says steps are being taken to make sure the petro-dollars are put to good use.

"They've made a good first step in that the Chadian government adopted an oil revenue management law, and this was passed by parliament and it directs oil revenues to key sectors like education and health," Mr. Gary pointed out.

"They have also set up a joint civil society revenue oversight committee which is a nine-person body, and it's an innovation that people are watching closely in Chad. If the government respects the law and this oversight committee has the mandate to fully monitor oil revenue Chad might have a better chance than some of the other countries that have gone before it," he added.

Mr. Gary calls this the paradox of plenty whereby oil riches have historically deepened levels of poverty, rather than reversing them.

In Kome, in southern Chad Friday, the pipeline will be officially inaugurated. Presidents Paul Biya of Cameroon and Idriss Deby of Chad are expected to attend, as well as six other regional heads of state.

They will promote west African oil as a growing alternative to supplies from the Middle East. The region is led by Nigeria, but other petro-states now also include the tiny west African country of Equatorial Guinea and landlocked Chad.