The Legacy of Lundin, Petronas and OMV in Block 5A, Sudan 1997 - 2003 The Legacy of Lundin, Petronas and OMV in Block 5A, Sudan 1997 - 2003 COLOPHON Research and writing: European Coalition on Oil in Sudan Translations Swedish newspapers: Bloodhound Satellite images: PRINS Engineering ISBN/EAN 9789070443160 June 2010 Cover picture: wounded man, May 2002, near Rier, South Sudan. ©Sven Torfinn / Hollandse Hoogte. Contact details European Coalition on Oil in Sudan P.O. Box 19316 3501 DH Utrecht The Netherlands E-mail: [email protected] This report is the copyright of ECOS, and may be reproduced in any form without the written permission of ECOS, provided the integrity of the text remains intact and it is attributed to ECOS. This ECOS publication was supported by Fatal Transactions The European Coalition on Oil in Sudan (ECOS) is a large group of European organizations working for peace and jus- tice in Sudan. ECOS calls for action by Governments and the business sector to ensure that Sudan’s oil wealth contributes to peace and equitable development. www.ecosonline.org Fatal Transactions is a network of European and African NGO’s and research institutes. Fatal Transactions believes that if natural resources are exploited in a responsible way, they can be an engine for peace-building and contribute to the sustainable development of the country. www.fatal- transactions.org Fatal Transactions is funded by the European Union. The con- tents of this report can in no way be taken to reflect the views of either the European Union or the individual members of Fatal Transactions. Disclaimer The European Coalition on Oil in Sudan can express views and opinions that fall within its mandate, but without seeking the formal consent of its membership. The contents of this report can therefore not be fully attributed to each individual member of ECOS. 2 WHY THIS REPORT In November 2006, a group of Sudanese civil society organisations attending the conference ‘Oil and the Future of Sudan in Juba’ called upon European Coalition on Oil in Sudan to assist in safeguarding Sudan’s Comprehensive Peace Agreement by working for compensation and reparation for the injustices caused by Sudan’s oil wars. This report is a response to that request. Being a coalition of European organizations, ECOS’ role is not primarily to hold Sudanese players to account, but to investigate the role of European parties. For this reason, ECOS decided to concentrate on Block 5A, a concession area that, until 2003, was operated by a European company and where two European companies, Lundin and OMV, together held a majority share. On November 11, 2008, an advance draft copy of this report was forwarded to Lundin Petroleum AB (“Lundin”), Petronas Carigali Overseas Sdn Bhd (“Petronas”) , OMV AG (“OMV”) and the Swedish Ministry of Foreign Affairs for comments. Lundin responded by stating that it considers the report to be defamatory and it reserved the right to claim damages if it were to be published. Lundin disputes the accuracy of the report, its conclusions and the in- terpretation of international law set out in the report. Lundin denies that it violated international law. It further denies that it was directly or indirectly involved in the conflict in Sudan or that it participated in or had, or ought to have had, knowledge of any of the illegal acts that are documented in this report. Lundin provided comments on the report to ECOS, which have been considered in detail and have been taken into account in UNPAID DEBT. Lundin copied Petronas and OMV into its correspondence with ECOS. These companies did not communicate di- rectly with ECOS and have not formally commented on the report. The Swedish Ministry of Foreign Affairs received a delegation from ECOS in 2008, but declined to comment on a non-published document. ©Sven Torfinn/ Hollandse Hoogte ©Sven Torfinn/ Wounded man near Rier, May 2002. 3 CONTENTSCONTENTS SUMMARYSUMMARY 5 5 IN BRIEF 7 IN BRIEF1. LAND AND PEOPLE 12 7 2. OIL AND SUDAN’S CIVIL WAR 14 1. LAND2.1 Overview AND PEOPLE 14 13 2.2 Sudan’s second civil war 16 2. OIL“WE AND CANNOT SUDAN’S GO BACK, CIVIL A WAR COMPANY IS THERE” 19 15 2.1 Overview3. WAR IN BLOCK 5A 20 15 2.2 Sudan’s3.1 The commencementsecond civil war of oil exploitation by the Lundin Consortium sparks war in Block 5A: 1997–1999 23 18 3.2 Oil is discovered amidst intense violence: 2000 – 2001 30 “WE 3.3CANNOT A Military GO Solution: BACK, 2002–2003 A COMPANY 35 IS THERE” 22 “WE AS A COMMUNITY ARE CRYING AND NOBODY IS HEARING US” 4 1 3. WAR4. THE IN DAMAGESBLOCK 5A 43 23 3.1 The4.1 Forcedcommencement displacement of oil43 exploitation by the Lundin Consortium sparks war in Block4.2 Changes 5A: 1997–1999 in farming activity 1994-2003 indicate massive displacement in Block 5A 45 27 3.2 Oil4.3 is Deaths discovered 46amidst intense violence: 2000 – 2001 36 3.3 A4.4 Military Destruction Solution: of dwellings 2002–2003 47 44 4.5 Destruction of livelihood 48 “WE 4.6AS LootingA COMMUNITY and destruction ARE ofCRYING cattle AND NOBODY48 IS HEARING US” 50 “WE ARE TRYING TO CLAIM FOR COMPENSATION BUT NO ONE IS RESPONDING” 50 4. THE5. COMPENSATION DAMAGES 52 51 4.1 Forced5.1 The displacementconstitutional right to compensation 53 51 4.2 Changes5.2 Interpretation in farming of the activity Interim 1994-2003 National Constitution, indicate massive article 208 displacement (5) 53 in Block 5A 54 4.3 Deaths5.3 Basic principles for the provision of compensation 54 62 4.4 Destruction5.4 The way offorward dwellings 54 63 4.5 Destruction6. THE LUNDIN of livelihood CONSORTIUM’S ACCOUNTABILITY FOR INTERNATIONAL CRIMES 56 64 4.6 Looting6.1 Corporate and destruction accountability of undercattle international law 56 64 6.2 The Lundin Consortium’s activities enabled the commission of international crimes by others 58 “WE 6.3ARE The TRYING Lundin ConsortiumTO CLAIM shouldFOR COMPENSATION have known that its BUT activities NO ONE contributed IS RESPONDING” to the commission of international 66 crimes by others 63 5. COMPENSATION6.4 The Lundin Consortium was proximate to perpetrators of international crimes 66 67 5.1 The6.5 Theconstitutional Lundin Consortium right to failedcompensation to act 67 67 5.2 InterpretationANNEX 1: GLOSSARY of the Interim 70 National Constitution, article 208 (5) 68 5.3 BasicANNEX principles 2: WARRING for the FORCES provision 71of compensation 69 5.4 TheANNEX way 3: forward LIST OF REPORTED ATTACKS IN BLOCK 5A, 1997-2003 73 69 ANNEX 4: ECOS BUSINESS PRINCIPLES 77 6. THEANNEX LUNDIN 5: EXPLANATION CONSORTIUM’S OF THE ACCOUNTABILITY SATELLITE IMAGES FOR INTERNATIONAL78 CRIMES 71 6.1 CorporateBIBLIOGRAPHY accountability 81 under international law 71 6.2 The Lundin Consortium’s activities enabled the commission of international crimes by others 75 6.3 The Lundin Consortium should have known that its activities contributed to the commission of international crimes by others 79 6.4 The Lundin Consortium was proximate to perpetrators of international crimes 82 6.5 The Lundin Consortium failed to act 83 ANNEX 1: GLOSSARY 86 ANNEX 2: WARRING FORCES 87 ANNEX 3: LIST OF REPORTED ATTACKS IN BLOCK 5A, 1997-2003 88 ANNEX 4: ECOS BUSINESS PRINCIPLES 92 ANNEX 5: EXPLANATION OF THE SATELLITE IMAGES 93 BIBLIOGRAPHY 95 4 SUMMARY From 1983 to 2005, Sudan was torn apart by a civil war ECOS believes that Lundin, Petronas and OMV, as a between the Government and Southern armed groups. matter of international law, may have been complicit in Oil was a factor in the outbreak and exacerbated war the commission of war crimes and crimes against hu- from the mid-1990s. This report is concerned with the manity. injustice perpetrated on victims and the role of oil com- panies and their home governments during the oil wars. This report calls for an investigation into the role of the Consortium in the oil war in Block 5A , explains the In 1997, the Swedish oil company Lundin Oil AB (“Lun- case for compensation for the victims and argues that din”) formed a consortium with Petronas Carigali Over- the home governments of Lundin (Sweden), Petronas seas Sdn Bhd (“Petronas”) from Malaysia, OMV (Sudan) (Malaysia) and OMV (Austria) have failed in their inter- Exploration GmbH (“OMV”) from Austria, and the Suda- national obligations to prevent human rights violations nese state-owned oil company Sudapet Ltd., hereafter and international crimes. At the time of the oil wars, referred to as the Lundin Consortium or the Consortium. these Governments received credible indications that They signed a contract with the Government for the decisions made by companies based in their territory exploitation of oil in the concession area called Block allegedly exacerbated war and contributed to violations 5A that was not at that time under full Government con- of human rights and the commission of international trol. The start of oil exploitation set off a vicious war in crimes in Sudan. These Governments are yet – after the area. Between 1997 and 2003, international crimes ten years - to account for their failure to act. It is ECOS’ were committed on a large scale in what was essentially position that the Governments are duty-bound to in- a military campaign by the Government of Sudan to vestigate the allegations concerning the activities of the secure and take control of the oil fields in Block 5A. As companies and to work to undo injustice. documented in this report, they included indiscriminate attacks and intentional targeting of civilians, burning ECOS calls upon Sweden, Austria and Malaysia to of shelters, pillage, destruction of objects necessary investigate whether or not the members of the Consor- for survival, unlawful killing of civilians, rape of women, tium met their responsibility to respect human rights abduction of children, torture, and forced displacement.