Canadian oil company Talisman has responded to persistent criticism of its presence in Sudan by pulling out of the country – but the decision has failed to satisfy all its detractors.
While alliances of North American non-governmental organizations, such as the Sudan Inter-Agency Reference Group, have for the most part responded positively, a coalition of European pressure groups has said Talisman should have stayed in the war-torn country and used its influence to promote peace between government and rebels.
‘Withdrawal is not a socially responsible thing to do,’ said Andrew Pendleton, spokesman at Christian Aid, the lead organization in the European Coalition on Oil in Sudan.
‘Talisman should have stayed in the country and said to the government: “We are suspending our operations until you come up with a peace deal”. With the threat of revenues drying up, the government may have been forced to act’, he added.
Talisman says it has entered into a ‘definitive agreement’ to sell its interest in the Greater Nile Oil Project in Sudan to a subsidiary of Oil and Natural Gas Corporation, India’s state oil company, for $758million (£480m). The deal should be completed by the end of the year.
Talisman’s chief executive, Jim Buckee, said the sale was agreed because the Sudan operation was affecting the company’s share price and reputation. Its shares rose more than four per cent on news of the sale.
‘We have consistently said that we liked our position in Sudan, the people and the project,’ said Buckee. ‘But Talisman’s shares have continued to be discounted, based on perceived political risk, to a degree unacceptable for a project that accounted for only 12 per cent of our production.
‘Shareholders have told me they were tired of continually having to monitor and analyse events relating to Sudan.’
Buckee said he had been ‘encouraged’ by recent developments in the country, where progress on a peace deal has been slow, but ‘selling our interest in the project resolves uncertainty about the future.’
Pendleton said that European NGOs had interpreted Talisman’s withdrawal as a sign that the company ‘is not really serious about corporate social responsibility’.
He added: ‘It shows that they are concerned about the reputational issues but not about having any positive impact on the country. Companies that are committed to CSR try to influence things for the better, even though it could lose them revenue in the short term.’
However, he said this depended on the circumstances of individual countries. In the case of Burma, Christian Aid would support companies that withdrew as this was what local democracy campaigners wanted.
Talisman said an unspecified portion of the money from the sale will pay for the company’s community programme in Sudan to continue at least until 2005, even though the firm will no longer be present.
Buckee also pledged to try to persuade the new owners to continue CSR policies.