2 - Differing realities
Continents Collide - The View from Space
Map: Heglig & Unity oilfields (LANDSAT)

Radar images from the space shuttle Endeavour in 1995 show that two ancient super-continents collided in what is now Northern Sudan. East Gondwana (present-day Australia, Antarctica and India) crashed into West Gondwana (Africa and the Americas) 650 million years ago, forming Greater Gondwana.

The collision caused extensive folds along a large fault, the Keraf suture, extending for thousands of miles to the Red Sea, and the deformation process is thought to have shaped the S-bend in the Nile.

A geologist from the University of Texas at Dallas who helped analyse the space radar pictures predicted that the technique could soon be used to reveal other kinds of structures, including oil, groundwater and gold.

"Sacred gift to the faithful"?

A huge country of vast semi-desert expanses and intense heat, Sudan is said to have oil reserves of anything from 600 million barrels to 3 billion. It also has minerals, gold, uranium, and vast expanses of arable land. Tempting, perhaps. The government of Sudan has called the oil "a sacred gift to the faithful". Its would-be partners in the oil project - companies from Canada, China and Malaysia, Austria, Sweden and France - seem to think likewise, as do the suppliers of oil pipeline equipment from Britain and Germany, and the oil traders from Netherlands and Japan. But when it comes to making use of this asset, it is not only the sheer immensity of the terrain that brings with it a host of complications.

In practice, the success of oil extraction projects in Sudan will not only depend on the operators' ability to meet complex technical demands across vast distances in extreme high temperatures. They also face a volatile political background, in a poorly developed country with decaying infrastructure, embroiled in civil war. Optimism about "recoverable reserves" must be tempered by awareness of the full and genuine costs of extraction. In human terms as well as cash.

How much oil is there?

Proven oil reserves are enough to last some 15 years. Not enough to solve any of Sudan's deep-rooted problems, but enough to create plenty more.

The Virtual Oil Boom - The View from Cyberspace

Almost as distant as the space shuttle Endeavour, on computer screens a world away from the killing and maiming in remote Sudanese villages, stock market investors gamble with Sudan's fortunes.

When they engage in what they call "High Risk Oil Play", the high risk they mean is not the danger to life and limb from land-mines and AK-47s, but the risk of financial failure.

Enter Arakis…

The maverick Arakis Energy Corp of Calgary, Canada, bought part of the abandoned Chevron concession in Sudan for a token sum, through a National Islamic Front financier in 1992.

Its stock was for gamblers, not for the nervous. In the US-based Worth magazine, Arakis shares were depicted as a long shot. They were cheap to buy early on, with - just maybe - a possible huge payoff. But no guarantees.

Fortunes - hundreds of millions of dollars - subsequently changed hands in a virtual oil boom in the mid-1990s. Arakis was talking up its drilling results in Sudan and anticipating financing deals for their development. Profits were being stowed away by a lucky few on just the promise of oil, years before a single barrel was exported.

Some pragmatic "players" ventured to ask about the feasibility of the pipeline that Arakis was proposing, and about tiny Arakis' ability to raise the massive funding it would need. But the human cost and the political and environmental impacts of the project were not a consideration.

Arakis' financial adventures and broken promises resulted in market de-listing and massive fines - [see the Oil and Conflict Timeline pp 52-58] - and the pipeline project was near collapse when Talisman, a much larger Canadian company, took over in October 1998.

Has anything essentially changed?

Talisman used to be BP-Canada, before a management buy-out, and has grown - by acquisition more than original discoveries - into probably Canada's largest independent gas and oil exploration companies. Whereas Arakis was a buccaneering minor company, appealing to investors who didn't ask awkward questions, Talisman shareholders include massive pension funds and investment trusts, who sometimes do.

A campaign in North America, led by Canadian church shareholders, has begun causing serious embarrassment for both Talisman and the Canadian government, which is involved in supporting peace talks intended to end Sudan's 43-year old civil war.

 Human Rights And Public Image

Sudan's government - a military-Islamist junta - has a well-known and exceedingly bad human rights record. Not only is it waging a destructive war in the south in which over 1.5 million people have died, it is also brutally repressing civil society in the north. Perhaps not surprisingly, it has been obliged to employ public relations companies to improve its international image.

The government also periodically invites observers to visit areas under its own control, and intermittently allows aid into some of the areas which are not. It is, however, highly selective about whom it invites and what it allows them to see. Many places of extreme hunger and villages devastated by militia raids are off the map.

The regime has repeatedly denied permission for humanitarian flights to aid the most afflicted populations, dropped cluster bombs on clearly civilian targets, and repeatedly bombed clearly-marked civilian hospitals.

"A psychological boost"

Throughout the 1990s, Sudan's NIF government has been using the prospect of oil for maximum propaganda value, a vital part of its efforts to get rid of its international "human rights and terrorism pariah" status and attract foreign investment into its war-devastated economy. The growing involvement of Canadian and European companies has begun to lend it a much-needed, but unwarranted, appearance of respectability.

As Aung San Suu Kyi said of UK's Premier Oil in Burma: "Apart from the actual revenues that it brings to the government, it also constitutes a psychological boost because it makes the government feel that, however repressive they may be, they still have the support of big companies … And if those countries are from Western democracies, it's even more serious because it gives the military regime the chance to say: 'Look, even companies from Western democracies support us, so what we are doing can't be that wrong. Why are the democratic forces making such a fuss…?'"
(Mark Thomas / Channel 4 TV www.channel4.com, October 1999)

Above all, the National Islamic Front government desperately needs the revenue from the oil project to strengthen its grip on the country.

Despite its constant use of the word "Popular" in its slogans, the NIF itself is extremely unpopular. In the 1986 general elections its members won less than ten per cent of the vote; it staged a coup d'état in 1989 to abort a peace process, and it would lose disastrously if free elections were held now. But it has held on to power for a decade on which it has made its mark by its readiness to deny charges of systematic and gross human rights abuse, claiming persecution by the outside world for its "Islamic orientation". In practice this has amounted to religiously-infused totalitarianism, feared and despised by the predominantly Muslim community in northern Sudan nearly as much as by the people of the generally non-Muslim south. Its encouragement of violent militancy has spread beyond Sudan's borders and is a source of alarm to its neighbours in the Horn of Africa.

3 - Funding the war