'A win-win just didn't work out'; US-backed project costs $77 million, fails to help Liberia.

• Author: Greene, Ronnie
• Position: Business

Byline: Ronnie Greene and Jonathan Paye-Layleh

BUCHANAN, Liberia -- On paper, the pitch was simple: A green energy company backed by $217 million in U.S. government loans would convert one of Africa's poorest countries into the world's first biomass-driven economy. But the plan to help Liberia collapsed amid questionable business decisions and oversight.

The company, Buchanan Renewables, dismissed 600 workers and left the country amid complaints of workplace injuries, environmental harm and, at times, sexual abuse.

Deep political links

Backing the company at every stage was the Overseas Private Investment Corp., a federal agency with a global mandate but low profile. The agency approves more than $3 billion a year in financing, targeting developments in hard-pressed communities. But its internal watchdog has issued reports on just five deals since 2005, a period when OPIC approved more than 530 projects.

From the start, an investigation by The Associated Press found, OPIC's support for the power project in the West African country of Liberia was marked by questionable scrutiny and deep political links. Even for ostensibly philanthropic projects meant to aid the world's poorest, corporate opportunities and profits can intersect with family and business ties among Washington's political elite.

On the ground in Liberia, Buchanan Renewables' CEO was James Steele, a larger-than-life former U.S. military figure and onetime Texas business partner of OPIC's then-president and CEO, Robert Mosbacher Jr. Mosbacher's father was Commerce secretary under President George H.W. Bush.

Steele drew acclaim, and controversy, over his role in U.S. military efforts, from the Iran-Contra affair to Iraq, where he performed work for President George W. Bush's defense secretary, Donald H. Rumsfeld.

Even before the Liberian project, Mosbacher had tapped Steele as a consultant to help OPIC develop power projects. Over 22 months from 2006 to 2008, the agency paid Steele $390,000 for consulting and an additional $114,556 in travel expenses, the AP found. Then it approved three loans to support Buchanan's vision in Liberia.

$77 million spent

The venture collapsed amid tensions between the company and the Liberian government, questions from the U.S. Embassy and the withdrawal of a vital financier. Troubling stories emerged: Charcoal producers having to trade sex for wood promised as part of the undertaking (the wood is burned to create charcoal); Buchanan's machinery...