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São Tomé e Principe - Introduction

The island nation of Sao Tome and Principe (STP) is situated in the equatorial Atlantic in the Gulf of Guinea. STP is one of the poorest countries in the world. Expectations of an oil windfall seem premature.

São Tomé e Principe is a joke. Many Americans would look at the name of this country and be uncertain as to how to pronunce it properly. It is much easier to just call this potentially oil-rich country STP. But the joke is that STP is also a brand name and trade name for a line of automotive additives. Scientifically Treated Petroleum, better known as STP®, began with one product — STP® Oil Treatment. It helped automobile motor oil resist thinning at high temperatures and pressures. Charles Dwight (Doc) Liggett, Jim Hill and Robert DeHart began packaging STP® Oil Treatment in a backyard garage at night in 1954, and sold it from the trunks of their cars during their business and pleasure trips.

In 1961 the STP® brand was purchased by the Studebaker-Packard Corporation. Andy Granatelli was appointed CEO and began to increase the brand’s marketing efforts through auto and boat racing. Eventually, STP® sponsored its own Indy Car racing team, featuring Mario Andretti, the winner of the 1969 Indianapolis 500. A 1976 consumer protection order required STP to have scientific backing for certain statements and prohibited making false claims. In 1995, STP paid $888,000 to settle Federal Trade Commission charges of false advertising. The settlement was the third largest to date for violation of a consumer protection order, the commission said. The STP oil additive promised more than it delivered, and oil has promised more than it had delivered to STP the country.

Sao Tome was named after Saint THOMAS the Apostle by the Portuguese who discovered the island on 21 December 1470 (or 1471), the saint's feast day; Principe is a shortening of the original Portuguese name of "Ilha do Principe" (Isle of the Prince) referring to the Prince of Portugal to whom duties on the island's sugar crop were paid.

The islands of São Tomé and Principe was once known as "the islands in the middle of the world," and in a way it really was. The Portuguese first landed here in 1470. The Equator runs right across the little island off the south coast, and the Prime Meridian is only a few degrees to the west. The Democratic Republic of São Tomé e Príncipe [frequently seen as San Tome and Principe, or at times Ilha de Sao Thome and Ilha do Principe] consisted of the main islands of São Tomé and Príncipe and several islets (Bombom, Caroço, Rolas, Tinhosa Grande, Tinhosa Pequena, Vabras, and Varoco) in the Gulf of Guinea. Situated offshore Gabon between Equatorial Guinea's Bioko and Annobón, the nation encompassed a total area of 1,001 km2. In 2002, the nominal GDP of São Tomé e Príncipe was estimated to be $55 million, and the population was estimated to be about 170,000.

The Africa Development Bank has considered STP as a ‘Fragile State’ since 2010, mainly due to persisting poverty, economic vulnerability to external shocks, weak Government capacity and inadequate provision of basic social services to the population. The country’s fragility is compounded by its insularity, as well as an embryonic entrepreneurial base that suffers from a weak business environment and lack of infrastructure, notably as regards ports and transport, thereby impeding competitiveness. Furthermore, the country is highly dependent on external aid.

STP’s extensive maritime domain might present opportunities for hydrocarbon production as technology improves, but falling petroleum prices are curbing interest in new exploration. In 2002, the Nigeria-São Tomé & Príncipe Joint Development Authority was established to resolve problems associated with petroleum exploration in an area of overlapping maritime exclusive economic zones. The treaty that authorized the Joint Development Authority and defined the zone's coordinates had been signed in 2001 after 14 months of negotiations. In 2002, the Government began the renegotiation of existing petroleum agreements it had with Chrome Energy Corp. of the United States (an indirect subsidiary of Chrome Group of Nigeria), which was formerly known as Environmental Remediation Holding Corp. of the United States, ExxonMobil, and Petroleum Geo-Services ASA of Norway to conform with Joint Development Authority strictures.

Sao Tome was optimistic that substantial petroleum discoveries are forthcoming in its territorial waters in the oil-rich waters of the Gulf of Guinea. Sao Tome is at the epicentre of a giant oil field -- up to 11 billion barrels of oil lie under its territorial waters. São Tome, with a population of only 140,000, is being wooed by the US, which had already deployed a military liaison officer as part of the Global War on Terrorism.

Sao Tome and Principe is one of the largest untapped oil provinces in Africa and several major oil and gas companies have shown interest in this small nation. ExxonMobil Corporation already holds exploration and production rights for multiple blocks through previous agreements. Despite its lack of exploration or production, prospects are good for Sao Tome and Principe. Exploitation of offshore petroleum had been impossible due to a maritime boundary dispute between Sao Tome and Principe and Nigeria. Completion of the Joint Development Zone (JDZ) agreement between the two nations followed a resolution of the dispute, clearing the way for business to commence. The first round of international tendering for offshore blocks in the JDZ has closed and bids will be opened and evaluated beginning in October 2003.

By the early 20th Century the low coast land of San Thome was very unhealthy for Europeans, but in the higher parts of the country good health might be enjoyed. In the town itself, health conditions were very bad; there were 110 sanitary arrangements, and the water-supply was very impure. Common ailments, alike among Europeans and natives, were black-water fever, pneumonia, dysentery, malaria, enteric phthisis [tuberculosis? typhoid fever?], and sleeping-sickness. Sleeping-sickness was at one time the scourge of Principe, but owing to preventive measures, the island was in October 1914 officially declared to be free of the disease.

There are no main highways in STP. Local roads provide access to most villages. These roads are poorly maintained and narrow. Avoid driving at night in deserted areas or those with low population density. Rural and suburban areas alike are poorly illuminated and pose additional safety hazards due to pedestrians and animals crossing the roads. Vehicles are not well-maintained and often lack headlights. Traffic accidents are one of the greatest dangers to visitors. Visitors should exercise extreme caution as both a driver and a pedestrian, as enforcement for speeding and reckless driving is not vigorous. Road hazards include poor street lighting, failure by drivers to obey traffic signals, a lack of marked pedestrian crossings, livestock/animals on roadways, slow moving vehicles, large trucks, inebriated drivers, poorly-maintained roads, and erratic stopping by taxis and other vehicles.

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