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Story Publication logo February 3, 2002

Sudan Oil May Be Funding War



The following article ran as part of an eight-part series by Jon Sawyer, originally published in the St. Louis Post-Dispatch January 16-February 6, 2002.

The wild card in Sudan's civil war is a "lake of oil" that happens to ooze just beneath the surface of some of the most contested real estate on the face of the earth.

Some analysts call oil profits the war's single most important factor -- a dramatic infusion of cash that has enabled the government to order the MiG fighter planes and helicopter gunships it has used to beat back rebel advances. Others view oil as Sudan's best hope for a stable, prosperous future -- provided, that is, that southern rebels don't blow up the plants first.

Oil was discovered in 1978 near Bentiu, a city in what historically was the southern, "African" part of Sudan that had autonomy from the Arab-dominated government in Khartoum.

The government has moved to gain control of the oil ever since. In 1983, it retracted the south's autonomy. In 1997, it built a 940-mile pipeline to insure that the oil would flow north through territory it controls.

New discoveries in the mid-1990s made Sudan a player on world oil markets. Production is now 200,000 barrels a day and is expected to double by 2005. Oil already accounts for up to 40 percent of government revenues.

The oil boom is why critics of Sudan's government say that foreign oil companies -- especially companies from Western democracies -- have no business helping to prop up Sudan's war machine.

Their current target is Talisman Energy, Canada's biggest independent oil and gas production company. In 1998, it bought a 25 percent share in Sudan's largest production consortium; its partners include companies from China and Malaysia, as well as Sudan itself.

Rebel threats

In an interview two weeks ago, rebel leader John Garang told the Post-Dispatch that the rebels' single most important target is the oil base at Heglig, about 70 miles north of Bentiu.

There, the threat is taken seriously.

The field base manager is Guo Yan, a genial Chinese who points out the five-stage "Alert Station" posted outside his office in a metal trailer. The stages range from "White" (normal operations) to "Black" (immediate evacuation).

Guo said the base came close to the latter last August, when rebel forces allied with the Sudan People's Liberation Army lobbed missiles directly over the headquarters compound.

In response, Guo said, the Sudanese army beefed up its military presence considerably, though neither he nor the government would give numbers. Outside analysts and rebel officials peg the total at about 15,000 troops, most of them stationed close to Bentiu but with a sizable presence also in the town of Rubkona on the road toward Heglig.

Six checkpoints are visible along the road, plus a military encampment in Rubkona itself that appeared large enough to house several hundred troops.

Skittish bureaucrats

Although Talisman officials had promised to help Post-Dispatch journalists with access to the oil facilities, they were unable to deliver; a reporter and photographer got only a quick briefing, a half-hour tour of the local hospital and a two-hour drive, during which they were not given time to leave the car. No interviews of the military were allowed, and the journalists were not permitted to stay overnight.

Afterward, the company officials apologized. They noted the multiple bureaucracies involved -- the Chinese and other partners within the consortium as well as Sudan's ministries of energy and external relations. All are skittish of media contacts in the wake of stories -- false, in their view -- alleging that the oil industry has directly aided military attacks on the rebels and evicted people living in the exploration and production zones.

Talisman itself has a far better reputation within Sudan than among activists in the United States, Canada and Europe. Among the company's surprising allies here are well-known human rights activists in Khartoum, such as newspaper publisher Alfred Taban. In their view, pushing Talisman out would open the door for a bigger stake in Sudan's oil by China, Russia and other countries that would be oblivious to human rights concerns.

Outside audits have given glowing reviews to the company's efforts to help people in Sudan through initiatives such as hospitals and farming projects.

That hasn't stopped activists from putting Talisman at the center of a global campaign to stigmatize investment in Sudan. Last year it took concerted opposition from the administration of President George W. Bush to block passage of a bill in Congress that would have denied American capital to any foreign firm (read: Talisman) in Sudan.

The bill is still alive, with final negotiations between the House and Senate scheduled for later this month. A 1997 law already bans U.S. firms from doing business in Sudan.

Special envoy John C. Danforth did not come to the oil region during his two peace missions to Sudan.

"We wanted an analysis of the oil situation" from the State Department, he said at the end of his second trip, last month. "We've been asking for it since September. We've gotten nothing."


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