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Analysts: Greater Security, Governance Needed After Algeria Crisis

An unidentified person right, is followed by Algerian officials as they enter a morgue in Ain Amenas Algeria Monday, Jan. 21, 2013, where the bodies of the persons killed during the hostage situation at the gas plant in Ain Amenas,. At least 81 people ha
The head of oil giant British Petroleum has said the more than 80 deaths following a hostage seizure at a natural gas complex in Algeria have prompted the company to review its security. The attack at the Ain Amenas plant is one of the worst in recent history, but it is part of a growing pattern of attacks and kidnappings targeting African oil, gas and mining operations. Analysts say this incident underscores the need for improved security - and for governments to step up their own efforts to maintain peace and stability.

BP chief executive Bob Dudley said his company had “never experienced an attack on this scale before” in the aftermath of the hostage situation that killed workers from Algeria, the U.S., Britain, France, Japan and Norway.

Such attacks are happening across Africa, however, especially in nations rich in resources but lacking internal security and infrastructure.

Energy exports

Countries like Algeria, Nigeria and Angola rely heavily on their energy exports. But as those nations are increasingly finding out, those resources can bring danger. Dozens of foreign workers across the continent have been kidnapped, attacked or killed in the last five years.

Often the attackers, like an al-Qaida offshoot in North Africa that has made kidnapping into an industry, are seeking large ransoms.

Or sometimes, like the branch of the al-Qaida group that claimed the Algeria attack, they have political aims. A Nigerian militant group active in the oil-rich Niger Delta says it kidnaps and sabotages to seek equality for its people. An Angolan separatist movement has attacked dozens for its cause.

Whatever the group’s cause, the motives for attacking oil and gas plants are the same, said analyst Balaji Srimoolanathan: They grab international attention and make a big impact.

Security paramount

Srimoolanathan, principal defense and security consultant at business consulting firm Frost & Sullivan, said the alarming trend has been a boon to a growing security industry that guards oil and gas infrastructure. The firm reported earlier this year that the industry niche earned more than $18 billion in 2011. By 2021, they estimate that figure will rise to more than $31 billion.

Keeping those structures secure has far-reaching implications, he said.

“A lot of companies like BP and Shell, who have massive operations in Africa, are investing quite significantly in securing the plants. However, the kind of investment we are seeing today was not foreseen as good enough to secure plants against terrorist threats," said Srimoolanathan. "You have technology to help deter such issues. However, on a broader scale, at an African scale, you have countries who are relying on oil and gas for their economic growth, who do not take a very serious and consolidated effort toward securing this oil and gas infrastructure, it’s seriously going to cripple their economy. As companies have already seen, it’s quite serious now and risky to do this in Africa as such.”

To that end, Srimoolanathan, who is based in London, suggested that African nations band together to create an African infrastructure security force. He recommends a more proactive approach.

“What went wrong in this particular incident? The level of deterrence that was there would have been pretty low in the first place to prevent such incidents," said Srimoolanathan. "That’s why we’re seeing a much more reactive situation here from the Algerian military. Whereas if there were a much more proactive approach to … securing such critical infrastructure sites across the country, a lot of these incidents can be deterred in the first place.”

Vulnerabilities exposed

Analyst Anneli Botha of the Institute of Security Studies, a South Africa-based think tank, described the Algeria attack as a “wake-up call.” She said attacks by armed groups on oil, gas and mining operations lays bare another problem: African nations’ failures to maintain security and provide for their people.

“You have this cycle. But the cycle is not the multinationals. The cycle starts with not providing the basic services that people need. And that is not the responsibility of the multinationals," said Botha. "So it definitely is the essential aspect in this whole debate. Whether you’re in South Africa, whether you’re in Nigeria, whether you’re in Algeria, whether you’re in Mali - you need to have a functioning government, and in the absence of a functioning government, you allow people to use this to their advantage.

"So it all for me starts with the question: What is the level of governance in most of these countries? The question is: If you have a situation of poor governance, that can be used, and it is being used, to a great degree.“

Energy giants like BP and Shell have not been specific about how they plan to boost security. But one thing nobody expects is for the wheels of industry to stop turning.