Natural Resources and Violent Conflict - WaterWiki.net

attracting reputable companies 339Issues. The controversy over the presence of Western oil companiesin Sudan, and Talisman’s eventual sale, highlights many of the questionsraised in this chapter. In particular, what is the extent of oilcompanies’ responsibilities toward a sovereign government in a regionof conflict?After Chevron withdrew, Sudan was unable to attract any of themajor companies despite its favorable geological prospects. The political,security, and reputational risks made the costs of entry too high. Bycontrast, the country was able to attract interest from smaller Northerncompanies and from Southern companies that are wholly or partiallystate-owned.Of all the companies operating in Sudan, Talisman has attracted themost attention. Its listing on the U.S. and Canadian stock marketsmeant that it was more exposed to nongovernmental organizationpressure and political activism in those countries. Canadian churchesand other organizations were able to claim a special sense of responsibilitybecause a company from their own country was involved in awar zone. Lundin and OMV have also faced criticism from churchesand nongovernmental organizations in their own countries, but on asmaller scale.The criticisms levied against the oil companies have been partly“local” and partly “national.” At a local level, Talisman was accused ofbenefiting from military operations to depopulate the regions immediatelysurrounding the oil fields (see, for example, Christian Aid 2001).At the national level, the company was accused of helping to finance theconflict through the revenue that it produced.In its report Corporate Social Responsibility 2001, Talismanpointed to its limited ability to influence the government on securityissues. It had advocated the signing of a security agreement betweenthe government and Greater Nile Petroleum Operating Corporation.Among other provisions, the draft agreement stipulated that the governmentwould adhere to the UN Code of Conduct for Law EnforcementOfficials and the UN Basic Principles on the Use of Force andFirearms by Law Enforcement Officials. However, the governmentrejected the draft agreement, arguing that “the provision of securityis the prime responsibility and prerogative of governments and thatthese issues were not appropriate to be addressed by a company residingin and operating under the laws of Sudan” (Talisman Energy2001, p. 17).More positively, the company managed to secure the government’sagreement to publish a summary of oil revenues and said that it would“continue to advocate for the expenditure of oil-related revenue forpeaceful purposes” (Talisman Energy 2001, p. 26). However, it added