Sudan - Controversy - E&P History.

Exploration and development of Sudan's oil resources has been controversial. International human rights bodies have accused Khartoum of financing human rights abuses with oil money, including the mass displacement of civilians near the oilfields. Factional fighting in the south and rebel attacks on oil infrastructure have kept oil production and exploration from reaching full potential to date.

In October 2004, Khartoum prevented a militia attempt to sabotage the country's main crude oil export pipeline. However, the January 2005 CPA between Khartoum and the GoSS was signed to end the North-South conflict. Now the danger of this conflict being revived is serious and is made more complicated by the Darfur war, in which the main rebel groups - including JEM - insist only regime change in Khartoum and a credible UN force would bring about peace in that vast province.

In January 2005, after the signing of the CPA, IOCs including Total, Marathon Oil of the US, and the state-owned Kuwait Foreign Petroleum Exploration Co. (KUFPEC) renewed their exploration rights to Block B in the south. But because of the US sanctions, Marathon sold its stake in this venture. But Total's operations remain suspended.

Several US states have passed legislation requiring their pension funds to cut investments in firms operating in Sudan, after atrocities were committed in Darfur. Some US pension funds are voluntarily barring investment in companies operating in Sudan when they are not satisfied with their impact on this country's human rights. That is what California Public Employees' Retirement System (CalPERS) did with nine companies in 2006 while deciding to retain shares with other groups operating in Sudan which are committed to human rights.

Dindir Petroleum Int'l (DPI), the largest oilfield services company in Sudan, in November 2006 signed an exploration and production sharing agreement (EPSA) with the Khartoum Ministry of Energy and Mining for a 200,000 sq km block in the north-west of the country. DPI then said it had 15% in the block and, along with five un-named partners, was to invest a minimum of $43m over six years, shoot 3,000 km of 2D seismic surveys and drill four wells.