Monday, March 28, 2005

Sudan signs $400m contract with Sudanese White Nile Petroleum for oil field development in southern Sudan

Yesterday, a contract to develop oil in South Sudan was signed by the Government of Sudan (GoS) with a company whose owners are from Malaysia, India and the Sudan. It is not clear if any members of South Sudan's former rebel group SPLM/A, led by Dr John Garang, were consulted on the deal.

A report on the story just out from Reuters says "the deal states both sides will respect any oil contract signed before the date of the peace deal -- January 9, 2005 -- and any deals after a new government of unity is formed will be decided by a joint petroleum commission from the national energy and mining ministry." Also, the report mentions analysts are saying the deal indicates divisions within the SPLM/A [but it is not clear, to me anyway, what they mean by that].

The SPLM/A were not officially recognised as heading up South Sudan until they signed a peace deal with the GoS on January 9, 2005. Before that date, they were referred to as rebels. Now that they are getting organised to start up a Government of South Sudan (GoSS) - sometimes called 'New Sudan" - they are referred to as "former rebels." Having two governments within one country sounds confusing. Note, the Reuters report refers to "a new government of unity" being formed, along with a "joint petroleum commission from the national energy and mining ministry."

As part of the January peace deal, Dr Garang, a US educated economist who fought as a guerilla in the bush for some 40 years, is scheduled to soon be sworn in as Sudan's First Vice-President, taking the title from the President's right hand man, Taha. Apparently, when Sudan's "new government of unity" is formalised officially, Taha's new role will be to float in the background doing this and that for Sudan's President Bashir who recently made Taha responsible for handling Darfur.

The January peace deal, in the eyes of the world, seemed to legitimise the regime in Khartoum. Sudan's President, Omar el- Bashir, recently voted by an American magazine as the world's worst dictator, is part of a regime that stole power through the barrel of a gun well over 15 years ago. During the past 21 years of war in South Sudan, the SPLM/A took it upon themselves to stake their claim on South Sudan, after Bashir's gang staged a coup and staked their claim on the whole of the Sudan. Which of them is legitimate? Neither the SPLM/A or GoS were voted in by the people of Sudan.

Over the past few months, news reports reveal that a UK listed shell company called White Nile agreed an oil development deal with the SPLM/A, giving White Nile part of Block B in South Sudan. Recently, news emerged that in December of last year, when the peace deal between the SPLM/A and GoS was close to being signed, France's energy giant Total oil, in partners with Marathon Oil of Texas, USA, renewed its longstanding agreement with GoS to develop oil in the same area of southern Sudan. [See previous post here below re British White Nile and French Total]

Today, Reuters South Africa says the GoS signed a contract yesterday with a company called White Nile Petroleum (different company from White Nile) to take oil from the reserves of the Thar Jath oil fields, in Block 5a, in South Sudan. [See oil concession map at top of sidebar here on the right] White Nile Petroleum owners are from Malaysia, India and the Sudan.

The Reuters report says:
"The deal states both sides will respect any oil contract signed before the date of the peace deal -- January 9, 2005 -- and any deals after a new government of unity is formed will be decided by a joint petroleum commission from the national energy and mining ministry."
You would think that important sticking points, i.e., what happens with oil agreements re South Sudan signed by GoS before January 9, 2005, would have been clarified in the comprehensive peace agreement signed by both sides on January 9. For now, it seems GoS are saying GoSS cannot override oil agreements in existence before January 9 - and that GoSS must go through a new joint oil commission on any future oil deals, after the "new government of unity" is in effect.

It is not difficult to imagine a lot of mistrust. John Garang must suspect his new government may not have much sway within the new joint commission for petrol and oil. Who'd believe the dictators in Khartoum would be willing to share power? If they do not share power for the benefit of everyone in the Sudan, it seems likely New Sudan will vote to part from Sudan. The war over oil will continue because those in northern Sudan will feel deprived of oil revenues they perceive as belonging to them. As explained here earlier, Sudan's main oil is in South Sudan.

Within the past month, a British government official predicted the conflict in Darfur, western Sudan, will continue for another 18-24 months. And then there is eastern Sudan where people also feel marginalised. A leader of an east Sudan rebel group told AFP today their objective is to change the government. "The government does not want peace with us. There will be more fighting between the government and the Eastern Front," he said. Going by recent news reports, the British Amabassador to Sudan, Sir William Patey, has been working very hard on the diplomatic front. And let us not forget Eritrea and recent reports of Ethiopian troops massing along the border to send a message to Eritrea.

Surely the regime in Khartoum cannot carry on the way they have been going for so long. Even they, a while back, mentioned something to the press about "a pincer" movement aiming to weaken them. They are their own worst enemies. Had they screamed for international aid workers and UN peacekeepers in Darfur over the past year, while the world was watching, maybe they would not be in the pickle they find themselves today. Continuing on as a ruthless, unbending and corrupt dictatorship while refusing much needed aid and protection for the people of Darfur is their downfall.

Regardless of what tricks are pulled, South Sudan must not take up arms again. Sudan must not break up, or it will never have peace because of oil. No matter how tough it gets, Garang and his gang must work in harmony with Bashir and his gang or the leaders should be arrested by the African Union and put on trial for crimes against humanity. The two gangs must work in harmony with the Darfur gang of rebels and cease all violence while they work on a way how to get themselves trained and educated, with the UN's help, on how to run a democracy and make a new and united Sudan that everyone can be proud of. Right now, it is a hellhole and those who are fighting for power, with the blood of millions on their hands, are responsible for sorting it and stopping all violence now. People must be allowed to return to their homes and farms. They must start planting food and replenish livestock to bring up their families. They need to make a living. Children must get an eduction and medical care. The international community cannot keep feeding millions of people in the Sudan because of a handful of thugs that are treated by the UN and AU as a member state. The Sudanese people have no real government. Anarchy reigns.

Read the story about the oil deal, courtesy Reuters South Africa today, copied here in full. It states Sudan's main oil fields are in the south and disputes over oil fuelled the 21-year war in South Sudan cost 2 million lives.

Sudan signs $400 mln oil field development deal

Here is a copy in full of a KHARTOUM (Reuters) report Mon March 28, 2005 11:14 AM GMT+02:00:

Sudan signed a $400 million deal to develop its southern Thar Jath oil fields to an initial capacity of 80,000 barrels per day (bpd) by the end of March 2006, the oil ministry said in a statement on Monday.

The deal was signed late Sunday with the Sudanese White Nile Petroleum company -- a consortium of Malaysian state oil firm Petronas, which owns 68 percent, India's state-run Oil and Natural Gas Corp, which has a 24 percent stake and Sudan's state oil company Sudapet with 7 percent. The remaining one percent is divided between the three companies, an oil ministry official said. It said the reserves of the Thar Jath oil fields, in Block 5a in the southern Unity state, were estimated at a minimum of 250 million barrels. White Nile Petroleum is expected to dig 45 wells in the coming year, it added.

Sudan's main oil fields are in the south, and disputes over oil fuelled a civil war there for more than two decades, claiming 2 million lives mostly from hunger and disease. A peace deal signed in January ended Africa's longest civil war and has revived interest in Sudan's potential oil reserves.

The deal states both sides will respect any oil contract signed before the date of the peace deal -- January 9, 2005 -- and any deals after a new government of unity is formed will be decided by a joint petroleum commission from the national energy and mining ministry.

But an official from the former southern rebel group the Sudan People's Liberation Army (SPLA) has said it has signed a deal with a London-listed company called White Nile, giving it part of block B in SPLA-controlled areas.

The news caused consternation as French oil giant Total signed a deal with Sudan in 1980 for the whole of block B, and the deal was renewed in December.

Total and the government both say they are confident of the validity of the deal.

More senior SPLA officials have played down the report of the deal with British White Nile, which analysts say indicates divisions within the former rebels, who are due to join the government in the coming weeks after a two-month delay. - The British White Nile company is different from Sudanese White Nile Petroleum, the company awarded the $400 million contract on Sunday. - Reuters

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