Peace in Sudan
On Oct. 21, President George W. Bush signed into law the Sudan Peace Act. The legislation aims for stability in a very unstable place.
On Oct. 21, President George W. Bush signed into law the Sudan Peace Act. The legislation aims for stability in a very unstable place. And Sudan's citizens could eventually benefit from a promising petrodollar windfall that now is elusive.
Human rights advocates say that, since 1983, civil war and related famine in Sudan have led to more than 2 million deaths and over 4 million refugees.
The oil industry opposed an earlier House of Representatives version of the legislation. It sought to punish non-US oil companies that invest in Sudan by blocking their access to US financial markets.
Business groups said the law would violate international trade rules and weaken Wall Street.
The new law gives the administration more flexibility on possible sanctions. It also authorizes $300 million for peace efforts directed outside the control of the Sudanese government. Over the next 3 years, the legislation seeks to support civil administration, communications infrastructure, education, health, and agriculture.
The law calls on President Bush to "certify" to Congress every 6 months that the Sudan government is moving to end the civil war by negotiating "in good faith" with the country's primary rebel group, the Sudan People's Liberation Movement.
If the Sudanese government fails that test, Bush, after consultation with Congress, is expected to implement various measures. These include seeking a United Nations Security Council resolution for an arms embargo against the Sudanese government; instructing US executive directors of multilateral lending agencies to vote against and actively oppose loans, credits, and guarantees by international financial institutions; taking "all necessary and appropriate steps" to deny government access to oil revenues in order to ensure that the funds are not used for military purposes; and cutting back diplomatic relations.
But as with other sanctions laws, most notably the Iran-Libya Sanctions Act, the White House says it reserves the right to waive or exempt sanctions if it is in the US national interest. The law also calls on the secretary of state to produce a report every 6 months that includes the status of Sudan's development and use of oil resources and a description of the extent to which financing was secured in the US or with involvement of US citizens.
In 2000, the US tightened its own sanctions against Sudan, effectively blocking US oil companies from making investments.
A Canadian company, Talisman Energy Inc., is said to be mulling a sale of its 25% interest in the Greater Nile Petroleum Operating Co. (OGJ Online, Sept. 27, 2002). GNPOC owns four blocks in the Muglad basin that produce 60,000-65,000 b/d; Talisman does not expect production rates to increase much beyond that in 2003. GNPOC also owns a 932 mile pipeline from the producing fields to Port Sudan on the Red Sea.
According to the Energy Information Administration, Sudan's estimated proven crude oil reserves are 262.1 million bbl. Current crude oil production is about 229,000 b/d, of which 70% is exported.