Talisman sells controversial oil stake

Canadian oil company Talisman Energy on Wednesday announced the sale of its Sudanese oil interests, saying it would end uncertainty over their future. "Shareholders have told me they were tired of continually having to monitor and analyse events relating to Sudan," Talisman president and chief executive officer, Jim Buckee, said in a statement. Talisman's 25 percent share in the Greater Nile Petroleum Operating Company (GNPOC) would be sold to ONGC Videsh Ltd, a subsidiary of India's national oil company, for US $758 million, and would be completed by the end of the year, the statement said. Talisman has come under fire from human rights groups, which have argued that the company's four-year involvement served to support the forced displacement of people to make way for oil exploration, and that oil revenues have been used by the Sudanese government for arms purchases. They have also alleged that oil infrastructure has been used by the Sudanese military to prosecute the 19-year war against southern rebels. According to Buckee, however, corporate responsibility policies implemented within the GNPOC as a result of Talisman's advocacy efforts would "continue to influence the operations of the consortium for years to come." "We have long argued that Talisman's presence in Sudan has been a force for good and we have taken steps to ensure the benefits created through our involvement will continue to benefit the people of Sudan both now and in the future," he added. The GNPOC is 40 percent owned by the China National Petroleum Corporation, Malaysia's Petronas claims 30 percent, with the Sudanese government oil company, Sudapet, owning 5 percent. Recent months have seen an escalation of fighting around the main oil fields of western Upper Nile (Wahdah State), with aid agencies reporting the displacement of tens of thousands of civilians as a result of the fighting. While Khartoum has declared its intention to double oil production from the current level of about 240,000 barrels per day, the rebel Sudan People's Liberation Movement/Army (SPLM/A) has repeatedly said that oil installations are legitimate targets in the war, and that it intends to halt oil extraction completely. "Selling our interest in the project resolves uncertainty about the future of this asset," Buckee said. Ongoing peace talks between the government and the SPLM/A, and the signing of an agreement to cease hostilities for the duration of talks has raised hopes of an end to the conflict, and an improvement in the country's dire humanitarian situation. However, the parties have yet to reach agreement on the controversial issue of wealth-sharing, including the distribution of oil revenues.