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World Bank to decide on oil investing by July

Published by MAC on 2004-04-29

World Bank to decide on oil investing by July

Source: Planet Ark

April 29, 2004

Wahsington - The World Bank will decide by July whether to keep investing in oil, gas and mining projects, World Bank President James Wolfensohn said this week, a subject of concern to environmental groups.

Wolfensohn commissioned an independent report in July 2001 to review the bank's role in so-called extractive industries. Questions have been raised by environmental and global nongovernmental groups whether the bank's backing of such projects contributes to development and lowering poverty in poor countries.

The Extractive Industries Review, led by former Indonesian environment minister Emil Salim, recommended the bank cease funding oil and coal projects because of environmental concerns. In a draft response to the report in February, the bank said its absence from these projects could result in lower quality projects and weaker governance. The bank's most controversial oil projects, the Chad-Cameroon and Caspian oil pipelines, were approved by the lender's shareholders amid fierce opposition by development groups, which said the projects would do more harm than good. But Wolfensohn said this week the bank first wanted to complete consultations with industry and governments on the matter before it made a final decision. "I would guess you're looking at a June or July date for something definitive," Wolfensohn told a Washington conference on energy sponsored by the Center for Strategic and International Studies. "In the meantime, dialogue is going along constructively," he added.

Wolfensohn also said the oil and gas industry should pay attention to the needs of the developing world, where demand for energy is set to increase as populations grow. In China energy demand is expected to triple in the next 20 years, Wolfensohn said, adding: "And my guess is that's a conservative estimate."


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