An Arab-American Oil Firm Acquires PETRONAS Amidst International Trial of Lundin Oil for War Crimes in South Sudan
President Kiir with CEO of Caltech Investment Oil Firm
By PaanLuel Wël Media Ltd.
Monday, 25 September 2023 (PW) — In a startling turn of events, an Arab-American oil company, Caltech International Trading Corporation (Caltech Investment), has made a 3 billion US dollar deal with the South Sudanese government to purchase the shares of the Malaysian state-owned company, PETRONAS, which is fleeing from South Sudan amidst international trial of Lundin Oil Company for war crimes in South Sudan.
This decision by PETRONAS to flee the South Sudan oil sector, on the heels of the international trial of the Swedish Lundin oil Company for war crimes committed in Unity State, South Sudan, between 1997 and 2003, has raised concerns about the role of foreign oil companies in South Sudan’s turmoil.
Caltech Investment’s foray into South Sudan’s oil sector was formalized during a meeting between its Chief Overseer, Mohammed Malik, and President Kiir in New York. While the South Sudanese Minister of Finance and Planning, Dr Barnaba Bak Chol, touts the 3 billion US dollar agreement as an opportunity for South Sudan’s oil sector to flourish, there are troubling signs that this deal may not be in the nation’s best interests.
The backdrop of this deal is crucial. The trial of two former executives, Ian Lundin and Alex Schneiter, for complicity in war crimes committed in Unity State between 1997 and 2003 has cast a glaring spotlight on the actions of international oil companies in South Sudan. Lundin Energy Company, formerly known as Lundin Oil, is accused of seeking the assistance of the Sudanese government to secure its operations, leading to a horrific series of events, including aerial bombings, civilian casualties, and the destruction of entire villages.
While Lundin Energy Company vehemently denies these allegations, the Civil Society Coalition on Natural Resources (CSCNR) asserts that the company was fully aware of the risks and willingly accepted them. The CSCNR argues that the charges of conspiracy to commit war crimes are insufficient given the scale of suffering endured by the people of Liech County, where atrocities included rape, murder, torture, forced conscription, and mass displacement.
As this trial unfolds, it becomes increasingly evident that Lundin Energy Company’s actions are not isolated incidents. South Sudan’s oil industry has long been dominated by international oil consortiums, including the Greater Nile Petroleum Operating Company, the Dar Petroleum Operating Company, and the Sudd Petroleum Operating Company, with significant involvement from major players such as China National Petroleum Corporation (CNPC), Petronas of Malaysia, and India’s ONGC Videsh.
These international players have harmed South Sudan’s environment and people. Due to oil exploitation, South Sudanese communities continue to face displacement, violence, and ecological degradation. The consortiums, including CNPC, Petronas, and ONGC Videsh, have controlled the country’s upstream energy operations with little regard for the consequences.
South Sudan’s national oil company, Nilepet, has held stakes in these consortiums, yet its involvement has not mitigated the environmental and humanitarian consequences of the oil industry. For example, the Dar Petroleum Operating Company has faced criticism for its operations, including concerns about the quality of the crude it produces. Similarly, the Greater Nile Petroleum Operating Company has faced violence in the oil-rich Unity Field region, remaining a hotspot of conflict and human suffering.
In the case of Caltech Investment’s acquisition of PETRONAS shares, there are concerns that this move continues bad governance and exploitation. It raises questions about whether foreign oil companies have milked the country dry, contributing to government corruption and environmental degradation, and are fleeing the nation after the trial against Lundin Energy Company.
While the nation has shown optimism in the new Minister of Finance and Planning, Dr Barnaba Bak Chol, this decision to welcome Caltech Investment may disappoint citizens who had hoped for a departure from the corrupt practices of the past. South Sudan must exercise greater scrutiny and accountability over its natural resources to ensure a more sustainable and humane future for its people and the environment. Exploiting these resources must not be allowed to continue unchecked, contributing to the ongoing turmoil in the nation.
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