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TALISMAN “HUMAN RIGHTS” AND DEVELOPMENT EFFORTS, 2000-2002

Although the Canadian government had not imposed sanctions on it, Talisman responded to the pressure it was facing by appearing to change course. Instead of continuing an exchange of sound bites with activists, Talisman created an internal corporate responsibility department and took CEO Buckee off the front line. It made efforts to look as if it was taking its duties seriously and endorsing human rights language if not actions. Nevertheless, it repeatedly denied that there were abuses and, initially at least, denied that it had any responsibility in the human rights area at all.

Even though only 10 to 15 percent of Talisman’s overall operations were in Sudan,¹²⁴⁶ Talisman’s stock was discounted because of the controversy surrounding the Sudan operations. The Globe and Mail reported from Toronto on June 26, 2000, that oil analysts as a group felt that the Sudan discount in Talisman’s share price was in the range of Canadian $15 to $ 25, an effect serious enough to make the company a candidate for a hostile takeover.¹²⁴⁷ Talisman had a real financial motivation to make the image of its Sudan project acceptable to the market and to public opinion.

Talisman Annual Meeting, May 2000

Talisman held its annual meeting on May 3, 2000. According to the press, CEO Jim Buckee faced a “barrage of accusations” that the Sudan project was fueling the civil war in that country. People lined up at the microphones to protest, and the meeting lasted more than three hours.¹²⁴⁸

At that meeting, unlike the one in 1999, a shareholder initiative was permitted on the ballot. The shareholder proposal sought an independent audited report on Talisman’s compliance with the International Code of Ethics for Canadian Business to be completed within 180 days. An alternative resolution sponsored by the company’s management passed instead. It committed the company to conduct an in-house, but independently audited, report on its compliance with the Code, to be completed in one year.¹²⁴⁹

An Amnesty International report on oil and human rights in Sudan was issued in May 2000, criticizing mass displacement from the oilfields by the government.¹²⁵⁰ It helped fuel the discussion and protests at the annual meeting.¹²⁵¹ Among other things, Amnesty International recommended that Talisman “raise with the Government of Sudan the conditions for the return of civilians forcibly displaced from their homes in Western Upper Nile and Unity States.”¹²⁵² The report also found significant government efforts to force citizens off the land:

Tens of thousands of people have been terrorized into leaving their homes in Western Upper Nile since early 1999. Government forces have used ground attacks, helicopter gunship and indiscriminate high-altitude bombardment to clear the local population from oil-rich areas.¹²⁵³

In July 2000 Talisman endorsed Amnesty’s recommendations to Talisman and said that it agreed to raise the displacement issue with the Sudanese government. Any activities along this line—unless they were included in a vague statement that the company had advocated the “protection of civilians in conflict zones”—were however omitted from a letter from Talisman to Human Rights Watch of September 2000.¹²⁵⁴ And Amnesty International, in a follow-up press release in May 2001, a year after its report, said that Talisman had failed to live up to its commitments.¹²⁵⁵

Talisman Meets the Sudan Government; GNPOC Signs Code of Ethics, December 2000

With regard to the Khartoum government, Talisman said in correspondence with Human Rights Watch that CEO Jim Buckee and Legal Officer and Vice President Jackie Sheppard met with Sudan’s foreign minister and the minister of the interior in May 2000. During these meetings, the Talisman officials said, they advocated respect for human rights and the protection of civilians in conflict zones. Beforehand, CEO Buckee had met with Franklin Graham of Samaritan’s Purse, whose hospital in southern Sudan had been bombed at least four times in March 2000. Graham asked Buckee to advocate the cessation of the bombing of civilian targets. CEO Buckee said he “personally raised this issue directly with each of the Ministers.”¹²⁵⁶ However, according to charts conservatively compiled of bombing of civilian targets in the south, the government’s heavy bombing of civilian structures continued after this interview.¹²⁵⁷

In the face of continuing pressure, Talisman began to argue that its influence was limited because it owned only 25 percent of GNPOC—despite the fact that it was effectively lead partner and in charge of operations on the ground.¹²⁵⁸ Talisman pleaded that it could only push human rights so far with the consortium, as Petronas (30 percent) and CNPC (40 percent) could outvote it.¹²⁵⁹

Talisman pointed to a number of initiatives it had undertaken to sensitize GNPOC and its partners, Sudapet, CNPC, and Petronas, to human rights. Talisman claimed to be the first Canadian resource company to embrace the concept of establishing a comprehensive management program and system to ensure compliance with the International Code of Ethics for Canadian Business. “Only companies such as Shell and BP have approached these issues as comprehensively,” the Talisman letter stated.¹²⁶⁰

Also during their trip to Khartoum in May 2000, Buckee and Sheppard met with senior ministry of energy officials reportedly to advocate the adoption by GNPOC of a code of conduct and to emphasize the need for respect for human rights in Sudan. They also reported that they met the president of CNPC in Beijing and the president of Petronas in Kuala Lumpur, Malaysia, to advocate the same things.¹²⁶¹

Talisman said that two of its officers were asked to participate in a retreat held in June 2000 by Petronas executives in the Malaysian capital of Kuala Lumpur to discuss ethical code of conduct issues at an internal Petronas meeting, which Talisman believed was sparked in part by its advocacy efforts regarding the GNPOC code.¹²⁶² But up to the writing of this report, Petronas has still not adopted any code of conduct.¹²⁶³

In December 2000 GNPOC adopted a Code of Ethics,¹²⁶⁴ but this code was even more limited than the Canadian code adopted by Talisman. It mentioned human rights once, in the context of a commitment to: “Conducting business in a way that shall maintain social justice and respect human rights within the sphere of our responsibility and contractual obligations.”¹²⁶⁵ What this responsibility and contractual obligations might be were left completely undefined.

Importantly, the code stated that GNPOC would observe the principle of “[r]efraining from availing the company resources for political, tribal and armed conflicts.”¹²⁶⁶ Yet the code bound only GNPOC, and did not keep Petronas, CNPC, or Sudapet from engaging in whatever conduct they wanted, as individual companies.

The Talisman Corporate Social Responsibility Report for 2001 said that a certificate of compliance was developed in 2001 to monitor GNPOC business activities and test conformance with the code. The certificate of compliance was adopted in January 2002.¹²⁶⁷

Talisman Human Rights Monitoring

Talisman solicited the response of some human rights organizations to its proposals to improve its response to human rights issues, but it did not attempt to bring back into the picture the four Canadian NGOs with whom it had been in negotiation prior to February 14, 2000, about the creation of an independent monitoring organization.

In Talisman’s proposed community development budget for 2001, dated September 2000, the program listed only two items under human rights, which totalled Canadian $ 37,050 (or 4.84 percent of the total of “funds approved”). First were funds for one Talisman staff member and four GNPOC officials to attend a ten-day training program in Nova Scotia, Canada, at the Lester B. Pearson Peacekeeping Centre (Canadian $ 15,000) in August 2000.¹²⁶⁸

The second expense item was “development of a database to track and report on Conflict Resolution activities and agencies related to the Sudan conflict,” under an agreement signed in October 2000 with the Sudanese government’s agency for the internally displaced, Humanitarian Aid Coordination (HAC) (Canadian $ 22,050).¹²⁶⁹ Some Sudanese and others were concerned that, depending on who is in charge of the database, it could be misused for military purposes.

Corporate Social Responsibility Report 2000, Sudan (April 2001)

Talisman issued its Corporate Social Responsibility Report 2000, Sudan Operations (CSRR 2000), in April 2001. Talisman also commissioned satellite photos of selected locations inside the GNPOC concession, and an expert analysis of them which was released in April 2001 and shown at the annual meeting on May 1, 2001 (see below). An audit of certain statements in this CSRR 2000 was done by PricewaterhouseCoopers, London.¹²⁷⁰

In this report, Talisman presented the results of some aspects of its in-house human rights monitoring program. The program had a field coordinator who oversaw the program “in conjunction with security staff.”¹²⁷¹ It was not clear if the security staff referred to government internal security, GNPOC security, Talisman security, or all three. Regardless, it was not likely that the presence of any such overseers would encourage any victim of government abuses to report those abuses to the Talisman human rights monitoring program.

The 2000 corporate responsibility report described investigations of only seven cases. Predictably, they concerned employment disputes: allegations of physical violence against workers, verbal abuse, dismissal from work, etc. One case was closed by the end of 2000. Ten additional cases had been opened in November 2000 “to keep files of initial interviews with people who have been displaced.” These were not individual human rights cases, that is, interviews with individuals willing to make a claim of violation of human rights. They were information-gathering cases designed to “help [Talisman] build our understanding of human rights issues related to the GNPOC operational area.”¹²⁷²

Compensation Payments (Pipeline Only)

The Corporate Social Responsibility Report 2000 indicated that Talisman paid compensation to some populations displaced by its operations. However, it is not clear if compensation payments were made only to those living along the GNPOC pipeline in the north, or if they included those displaced within the south of Sudan.¹²⁷³ The government set up a Pipeline Compensation Committee to make assessments and payments to those living along the pipeline whose land use was affected. GNPOC was funding the Pipeline Compensation Committee to the tune of U.S. $ 1,841,946 and estimated total compensation would be paid in the range of up to U.S. $ 2,500,000.¹²⁷⁴

The Talisman corporate responsibility report for 2000 highlighted that the village of El Munawara, located about 200 kilometers south of Khartoum, i.e., well within the north, was moved about two kilometers from its prevous location “to provide a safe distance between the villagers and the oil operations.” Each of the 159 families in the village was compensated in cash, ranging from U.S. $ 290 to $ 870. Under review were compensation claims from others who grazed their animals around Pump Station #3, facilitated by representatives from the Sudan Ministry of Energy and Mining.¹²⁷⁵

In the south, by contrast, no compensation was paid, even though tens of thousands were displaced (some quite recently, as in the Gumriak area of Block 1). No compensation committee was ever set up for those in Blocks 1, 2, and 4 whose land use was affected. The government took what it wanted by military force, without compensation. Talisman wrote to Human Rights Watch on September 13, 2000 that:

In Sudan, since Talisman has been involved in the project, our management is unaware of any instances of civilian displacement occurring without compensation. In fact, it is Talisman’s understanding that when drilling occurred at an exploratory well location known as “Timsah”, consent was obtained from the farmers in the area and compensation was provided to them (for the removal of trees and damage to planted [sorghum or durra]). Compensation has also been paid to farmers whose crops were damaged by seismic survey activities.¹²⁷⁶

The suggestion that Talisman management was unaware of any instances of uncompensated displacement is disingenuous in light of the extensive evidence already publicly available at that time concerning forced displacement from the GNPOC concession during Talisman’s tenure. Talisman also offered no details of or evidence for its assertion that compensation had been paid in the cases it mentioned.

Development Initiatives and Relief Donations

Talisman also engaged in various development initiatives in Sudan, for which it hired three full-time employees. Talisman distributed a draft community development policy, which identified four primary focus areas (water, health, learning, and capacity building), to NGOs operating in Sudan and some Sudanese in Canada for input and advice.¹²⁷⁷ Many NGOs, however, told Human Rights Watch that they would not be comfortable collaborating with Talisman because it would make them appear non-neutral, given that Talisman was a business partner of the government, conducting its oil operations under military guard.¹²⁷⁸ Thus Talisman did not find any NGOs with which to cooperate.

Talisman nevertheless said it built five medical clinics in the concession area, of which two were fully staffed and operational (Pariang and Rubkona, both garrison towns) as of September 2000, although this was not independently confirmed. It drilled four high capacity water wells in Pariang, Rubkona, Dabbat, and Kummagon, and completed maintenance of twenty-eight water wells in communities along the pipeline between Khartoum and Heglig,¹²⁷⁹ mostly in the north.

However, local people pointed out to a visiting journalist that a school that Talisman had built was a shell. “There are no desks, no schoolbooks nor food for the students and no water.” One local relief worker chastised the oil companies for taking a picture of a school and displaying it “over and over to show how good they are. . . . What use is a house if there aren’t even any pens or paper.” The clinic that Talisman built in Rubkona is located in the middle of the army’s housing and far from the displaced camps, the local people complained to the journalist.¹²⁸⁰

Talisman also supported or planned to support many activities outside its concession, mostly in the pipeline area but others far away from the pipeline. For instance, it was looking into supporting a women and small business development project in Khartoum among women originally from the village of Pariang; nomad desert agriculture and communuty development north of Khartoum; hafir water storage development and training for repair along the pipeline route in northern Sudan;¹²⁸¹ and development of a hafir to supply fodder crops south of Babanoosa in Western Kordofan for the Baggara. The latter program, which was still in the “idea” stage—Talisman requested suggestions as to where this hafir should be located—was hoped to reduce Baggara need to travel south into Western Upper Nile/Unity State and thus reduce friction and conflict with southerners.

The community development document also listed other activities that would take place outside of the south, such as the funding for import of free medical instruments, equipment, supplies, and drugs to medical teaching facilities and the Red Crescent in Khartoum; a primary school outside Port Sudan; and a vocational training center in Rabak, across the White Nile from Kosti; and upgrading an existing vocational center in Wad Medani, both northern towns home to large numbers of internally displaced originally from Western Upper Nile/Unity State.¹²⁸²

The total funds approved in the community development document were Canadian $ 742,564.43 (U.S. $ 503,437), of which 52.1 percent were for outside the south; removing the emergency funds for Bentiu and Rubkona from the budget (Canadian $ 150,000 or U.S. $ 101,696), the amount assigned outside the south was 63.7 percent. Inside the south, it was 36.3 percent, little more than one-third of the Talisman development funds.

Talisman provided supplies when the influx of internally displaced from the Blocks 5A and 4 oilfield fighting hit Bentiu and Rubkona in August 2000. Almost 59,000 internally displaced were registered by WFP at the time. Many arrived with their cattle, causing sanitation and health problems in the urban area. Talisman issued a press release saying that it had provided medical supplies, one hundred large tents, five hundred mosquito nets, and established a temporary clinic for 220 patients a day.¹²⁸³ Talisman stated that the NGO cooperation (that had for so long eluded it) was finally taking place. “We’re working alongside the non-governmental agencies as part of a team,” said Mark Reading, one of several Talisman workers involved in the effort.¹²⁸⁴ Several organizations, however, hastened to dissociate their relief activities in Bentiu from Talisman.¹²⁸⁵ Six NGOs operational in that government-held area of Western Upper Nile/Unity State¹²⁸⁶ issued a press release that stated :

In light of the controversial nature of oil development in Sudan, [we] would like to clearly state that in the provision of humanitarian assistance to the vulnerable populations in Unity State, there is no relationship between these NGOs and any of the companies involved in the oil industry in Sudan.

While we acknowledge that Talisman (GNPOC) is providing assistance towards the needs, we strongly object to Talisman Energy’s allegations that they are working together as a team with the international humanitarian community. Talisman’s public statements infer a relationship that does not exist in Unity State.¹²⁸⁷

Talisman’s document, “Community Development Strategy – 2001,” updated its activities as of October 30, 2000, noting that under the category “emergency relief” it approved Canadian. $100,000 in funds for Bentiu and Mayom, mostly tents, tarplins, mosquito nets, medicine, and logistical support, in a project that was “on-going in cooperation with Peace Advisory Council” in Bentiu and with local authorities in Mayom, thus reinforcing the government’s presence and activities in the area.¹²⁸⁸ Furthermore, the development program, according to the Talisman document, was “designed and managed in close cooperation with GNPOC Security” and the ministry of energy and mining of Sudan.¹²⁸⁹

Talisman’s charitable contributions to Sudan in 2000 amounted to only a fraction of one percent of Talisman’s post-tax revenue.¹²⁹⁰ Talisman spent about $ 1 million in fifteen Sudanese community development projects in 2000.¹²⁹¹

Talisman planned to spend U.S. $ 2 million on community development in 2001, doubling the 2000 amount, and GNPOC would increase its 2000 community development contribution of U.S. $ 600,000 to $ 1.8 million in 2001.¹²⁹² Actually, in 2001, Talisman spent only U.S. $ 819,541 (of which $ 190,687 was carried over from 2000) on its own projects, and U.S. $ 617,327 (estimated) on GNPOC community development projects, or a total of approximately U.S. $ 1,436,868 in all in 2001.¹²⁹³ This is equal to .09 percent of Talisman’s 2001 post-tax revenue.¹²⁹⁴

Talisman Condemned at Annual Meeting 2001

Despite Talisman’s efforts, Canadian churches kept up the pressure on the company. A delegation of Canadian church leaders called for foreign oil companies to stop operating in Sudan until the civil war was ended. Rev. Bill Phipps, former moderator of the largest church in Canada, the United Church of Canada, led a week-long delegation from five churches on a trip to southern Sudan in April 2001 (visas to visit the government areas were refused), and criticized the Talisman corporate and social responsibility report issued in April 2001.

“We are outraged that a Canadian company is a major producer of oil located in southern Sudan, paying huge royalties” to the Khartoum government, the delegation’s statement said.¹²⁹⁵ Talisman’s first quarter earnings were very good, and the company issued its first shareholder dividend.¹²⁹⁶

Critics of Talisman gathered at its annual meeting on May 1, 2001, in Calgary to demonstrate in favor of Talisman withdrawing from Sudan. Others lined up inside the meeting to ask questions about Sudan from the floor.¹²⁹⁷ Amnesty International called on Talisman to do more to safeguard human rights in Sudan, concluding that the corporate social responsibility report did “not adequately address the issue of the human rights impact of the company’s operations in Sudan.”¹²⁹⁸

A Canadian group of nongovernmental organizations, the Sudan Inter-Agency Reference Group of Canada (SIARG), had commissioned a report on human rights abuses in the GNPOC concession. The two-person investigative team conducted field work in April 2001 and issued a short preliminary statement on their findings, that human rights abuses were continuing inside the concession, ¹²⁹⁹ with an oral summary presented by one of the researchers on the report at the Talisman annual meeting on May 1, 2001. The report concluded that the Sudanese government was using Talisman/GNPOC airfields to launch offensive operations against rebels.¹³⁰⁰

Talisman, when previously confronted with the Harker report (February 2000), had maintained that airstrip use was restricted to “defensive” activities.¹³⁰¹ How that term was defined, and how Talisman could establish that aircraft were engaged in “defensive” or “offensive” activities after flying out of sight, was not explained.¹³⁰²

Talisman admitted in its corporate responsibility report issued in April 2001 that “there were at least four instances of non-defensive usage of the Heglig airstrip in 2000. On these occasions helicopters or planes landed on the airstrip for reasons that we could not determine were related to oilfield security and their presence was considered non-defensive by Talisman.”¹³⁰³

Despite the protests at the annual meeting and fears of becoming a takeover target,¹³⁰⁴ CEO Jim Buckee, on a visit to Sudan in June 2001, said that Talisman would stay put in Sudan.¹³⁰⁵

Canadian Government Response

David Kilgour, new Canadian secretary of state for Africa and Latin America, urged participants at a conference on corporate and social responsibility in Calgary in March 2001 to follow the example of his church and sell their shares in Talisman as a form of protest. He also endorsed the idea of federal legislation that would penalize Canadian companies which are complicit in human rights abuses overseas and lamented that Ottawa had not done more to require Talisman to leave Sudan.¹³⁰⁶ The statement was not followed up by any action.

John Manley, who had replaced Lloyd Axworthy as Canadian foreign minister in November 2000, responded to the SIARG report that GNPOC airstrips were being used by the Sudanese government by saying, “If airfields are being used for offensive action against civilians, then that would be a serious breach of the norms of human rights and something of which we would strongly disapprove.”¹³⁰⁷ He pointed to a part of the report that said that Talisman had raised its concern with the Sudanese government that the airfields not be so used, “and Canada certainly shares that concern,” he said.¹³⁰⁸ But Foreign Minister Manley, when confronted by a member of parliament, claimed he had “no evidence” to support allegations that the Talisman airfields were used offensively by the military—despite the SIARG report.¹³⁰⁹

A few weeks later, Minister Manley sent Senator Lois Wilson to the region to stress Canada’s support for the IGAD process to end the conflict in Sudan. In a joint statement with junior foreign minister David Kilgour, he said, “Without an end to the war there can be no sustainable progress in Sudan on important questions of human rights, development and good governance,” and criticized both sides for persistent human rights violations. Manley also urged Canadian companies active in Sudan to be “transparent” in their activities, and said that he would continue to urge the Sudanese government to use revenues from foreign investment to promote peace.

Manley pointed out that Canada would provide Canadian $100,000 (U.S. $ 64,930) in financial support for the U.N. special rapporteur on human rights in Sudan, decided upon during Axworthy’s tenure as foreign minister. He welcomed Talisman’s designation of a field coordinator to monitor human rights in Talisman’s area of operation. He had indicated earlier in May 2001 that the Canadian foreign ministry would not revisit the idea of imposing sanctions on Talisman.¹³¹⁰

The foreign minister was chastised by the ministers of religion. They pointed out that in the midst of the Sudanese government’s “unspeakably cruel campaign to kill and displace civilians in the oil concessions . . . you call only for ‘strategies for ensuring transparency.’” Noting that, “Clearly, oil development has become a major disincentive for peace,” they concluded that:

Sudan’s war is a terrible, long-festering wound on the conscience of humanity. Canada should strain every resource at its disposal to end it with the one ‘sanction’ the government in Khartoum would find persuasive—an end to oil revenues until there is an end to the war. The facts are already transparent enough.¹³¹¹

A Canadian member of parliament (MP) in August 2001 disclosed that the Canada Pension Plan’s Investment board of directors, appointed by the government, invested Canadian $ 57.3 million (U.S. $ 37.28 million) in Talisman. The MP, Maurice Vellacott, said that the Canadian government thus made all Canadians complicit in the gross human rights abuses in Sudan: “Now most Canadians have blood on their hands, thanks to the Finance Minister.” He noted that the government did not include ethical guidelines for investing when it established the board in 1997, and urged the finance minister to see that the pension plan divested from Talisman swiftly.¹³¹²

The next foreign affairs minister, Bill Graham, and Senator Lois Wilson, still Canada’s Special Envoy for Sudan, condemned the attack at Bieh on February 20, 2002, and urged the Sudanese government to end all attacks against civilians and civilian installations immediately.¹³¹³

Cynical Satellite Images, 2001

Talisman reportedly paid a large sum of money for satellite photographs and analysis purportedly “proving” that there had been no forced displacement from its concession—going back to 1965.¹³¹⁴ These images were previewed for the press and then shown at its annual meeting on May 1, 2001. Later they were available in booklet form which Human Rights Watch received from Talisman and reviewed.

The Talisman satellite images were focused on seven locations in the GNPOC concession, some very small but including the two towns of Bentiu and Pariang (Block 1). The images, according to the commissioned analysis, tended to indicate that population in those seven places had grown, not diminished, thus proving that there had been no displacement—from the seven chosen areas. Taken on their own in the booklet as presented to the public, the images and the text are totally insufficient to demonstrate the conclusion that this "clearly refutes a number of highly exaggerated claims of widespread displacement from our concession area."¹³¹⁵

The images show an increase in population of the two towns. But patterns of migration do not usually take East African agro-pastoralists into urban areas such as Bentiu and Pariang, especially not to reside there. This population increase could prove rather that the classic counterinsurgency strategy of draining the sea, that is, pushing people from rural areas into urban areas where they can be more easily controlled, is being used in Western Upper Nile/Unity State—just as human rights groups have contended. It could also tend to prove that rural agro-pastoralists had been forced into towns because of drought, raiding, or other disasters in which they lost their animals and thus their means of self-sufficiency.

Aside from the oil/government centers where gross population counts have increased, the analysis did not look at adjoining areas of the Block 1 concession that are shown on earlier maps to have a high density of settlement. Instead, the other sites selected by Talisman for examination are small rectangles immediately surrounding active oilfields, areas that have not shown up on previous maps as population centers or even clusters.

Analyzing these limited seven images, it is not difficult therefore to come to the conclusion that "there is no evidence [in the satellite imagery] of appreciable human migration from any of the seven sites examined."¹³¹⁶

What these satellite photos show instead is that Talisman’s presence in Sudan resulted not in an improved human rights climate but in a better public relations machine operating on behalf of the government.¹³¹⁷ These satellite photos show that corporate oil partnership with Sudan, a government committing gross human rights abuses, resulted here in the oil company becoming a government publicist.¹³¹⁸

The best evidence of population displacement is the displaced themselves, and the agencies attempting to measure and meet their needs. Following the government’s lead, Talisman consistently avoided knowing or finding out anything about their existence, or taking steps to protect them.

Talisman Annual Meeting, May 2002

Sudan continued to occupy the attention of shareholders and management at the 2002 annual meeting in Calgary. Talisman’s role in Sudan was sharply criticized inside the meeting and by demonstrators outside.

Talisman issued its second corporate responsibility report, entitled Corporate Social Responsibility 2001 (CSRR 2001), in April 2002. It was expanded to include Talisman’s operations in Colombia, but the main focus remained on Sudan. It contained the results of an audit of data and statements conducted by Pricewaterhouse Coopers, London.

In the Corporate Social Responsibility 2001, Talisman:

· Noted that the Sudanese government agreed to allow Talisman to make public the amount of revenue the government received from oil operations, a positive step in the direction of transparency;

· Acknowledged that the Sudanese government rejected a draft security agreement between it and GNPOC on the grounds that security was the prime responsibility and prerogative of governments;

· Acknowledged continued reports of oil-related displacement, stated that it dedicated “a significant amount of financial and human resources” to investigate these claims, but failed to disclose the results of any investigation apart from the satellite photo study (above);

· Noted that the Heglig and Unity airstrips were increasingly used by the Sudanese military, but failed to disclose (as was done in CSRR 2000) the number of times it used these airstrips for “offensive” purposes;

· Acknowledged that the Sudanese government had rejected Talisman’s request that the government allow unrestricted and unfettered access to humanitarian organizations and human rights investigators within the GNPOC concession;

· Noted that the Talisman Internal Human Rights Monitoring and Incident Investigation Program had opened twenty-nine case files as of December 31, 2001, and closed fifteen of the cases as of January 2002. Ten cases involving people who returned to Pariang (implicitly from SPLA-held areas) reported on in 2001 had made little progress; and

Acknowledged eight separate “security incidents on oil infrastructure or personnel” in 2001, presumably rebel attacks. In one incident, six civilian members of a subcontractor’s road construction crew were killed during an attack for which the SPLA claimed responsibility.

Talisman Pulls Out, October 2002

On October 30, 2002, Talisman announced that it had agreed to sell its Sudan assets to ONGC Videsh Limited, a subsidiary of Oil and Natural Gas Corporation Limited, India’s national oil company.¹³¹⁹ Talisman estimated that the aggregate amount it would realize from the transaction would be approximately U.S. $ 758 million (Canadian $ 1.2 billion), an after-tax return of approximately 30 percent. It expected the sale to be completed by December 31, 2002, subject to conditions, relating to obtaining consents from the government of Sudan and the other consortium members and to the waiver or expiry of rights of first refusal.

Commenting on the sale, and effectively confirming that the decision was made as a result of pressure from the human rights community, CEO Jim Buckee said:

Talisman's shares have continued to be discounted based on perceived political risk in-country and in North America to a degree that was unacceptable for 12% of our production. Shareholders have told me they were tired of continually having to monitor and analyze events relating to Sudan. We are encouraged by recent developments in Sudan, but had to weigh all possible outcomes against having a firm and fair offer, in hand, right now. Selling our interest in the project resolves uncertainty about the future of his asset.¹³²⁰

Talisman stated that its development projects there would continue in the short term:

We have long argued that Talisman's presence in Sudan has been a force for good and we have taken steps to ensure that the benefits created through our involvement will continue to improve the lives of the people of Sudan both now and in the future. Talisman and its employees have made significant contributions to this end over these past four years, providing medical assistance, shelter, clean water, vocational training and initiating capacity-building programs. A program will be established to ensure continuity in funding of such Talisman development projects for the remainder of this year and through 2005.¹³²¹

The corporate responsibility policies and procedures implemented within the Greater Nile Petroleum Operating Company, the operator of the project, as a result of our advocacy efforts, such as the GNPOC Code of Ethics and human rights training, have influenced and, we hope, will continue to influence the operations of the consortium in the years to come. We also hope that the economic benefits of oil field development will play a constructive role in the Sudan peace process.¹³²²

While Human Rights Watch welcomes this decision, we believe that Talisman still shares in the complicity of the oil companies operating in Sudan for the human rights abuses documented in this report during the period of its operations in Sudan.