Exxon releases plan to compensate Chad villagers

WASHINGTON (Reuters) - U.S. oil major Exxon Mobil (XOM.N) released on Friday a detailed plan to compensate villagers affected by its expanded search for oil in Chad's southern Doba basin.

The revised action plan follows findings of an independent report, which said the expansion of drilling had affected the livelihoods of families who survived off the land despite some cash compensation by the company .

Exxon's affiliate, Esso Chad, commissioned the report following concerns expressed by the World Bank's private-sector lender, the International Finance Corp (IFC), which helped finance a pipeline that carries oil from Doba to the Atlantic Ocean through neighboring Cameroon.

The IFC said families would be worse off in the long term if their livelihoods were not restored.

Exxon operates the central African country's Doba pipeline, pumping 170,000 barrels a day through Cameroon, with partners Chevron Corp (CVX.N) and Malaysia's state run Petronas. IFC funding for the project was made available on condition that oil profits from the project would go toward projects that benefit the poor.

The action plan, which is posted on the company's Web site, identifies nine areas where Esso will improve compensation for families affected by drilling.

Among these, Esso said it would improve the way it assesses who is affected by its work; clear a backlog of land still to be returned to families after drilling has taken place; resettle villagers where necessary, and reduce the impact of its drilling on farmland.

Exxon also said it would set up a system to monitor the implementation of the plan, which will be tracked by Esso and IFC managers.

An IFC official said the plan, if implemented as planned, will "minimize the impact of the oil project and help strengthen the restoration of livelihoods."