Oil & Gas Company in Tunisia: Conflict and Divisions within Local Communities (2011)

An oil and gas company planned to conduct seismic operations off-shore. It contacted the local fishing association as part of planning the operations, explained the impact on the local communities’ ability to fish for a period of time and agreed on a compensation schedule for all fishermen who were members of the association. When the seismic vessels started to conduct their activities, they encountered local fishing vessels driving over their cables and interrupting the seismic operations. The company flew in a senior executive to investigate the situation (which was costing the company USD $400,000 per day of delay).

The executive found that the company’s stakeholder engagement processes had not identified schisms in the community, including the fact that the fishing association did not represent all local fishermen. Hence some locals were simply unaware of the seismic operations and of the agreement the company had concluded with the association. The company then engaged with the non-associated fishermen and agreed on an acceptable level of compensation, after which the seismic activities were able to proceed.

This case highlights again the importance of robust and ongoing stakeholder engagement processes, which could have helped the company identify the issue and avoid the costs of delayed operations. It also points to the issue of conflict: between communities and the company, between communities, and within individual communities.