Total may take Salva Kiir to court over Sudan Oil Field
by Paul Redfern, Special Correspondent, The East African
Aug 23, 2005 (Nairobi) — What do a former England cricket star, a South African businessman and the new leader of the Sudan People’s Liberation Movement have in common?
The answer, in a nutshell, is oil. And lots of it. For between them Salva Kiir, Phil Edmonds and Andrew Groves are the controlling influences in White Nile, a company that could in the near future exploit the vast oil reserves hidden beneath the surface in the Block Ba oil concession in southern Sudan. The deal between the SPLM and White Nile, which originated in August 2004, is contested by Total, who say they were given the concession rights for Block Ba by the government in Khartoum in 1980.
Many analysts feel that the deal is not worth the paper it is written on despite the fact that Total is planning to dispute White Nile’s claim in London in the near future. Investors in White Nile appear unperturbed, however. The company, which was only listed on the London stock exchange in February at around 10p a share, rose to a massive 138p soon afterwards, although they slumped to around 80p following the death of former SPLM leader John Garang last month.
This was probably part of the reason for Edmonds and Groves’ visit to Juba soon afterwards to meet with Mr Kiir and his deputy Riek Machar. But with stability returning to the region following the quick succession, the shares are looking up again.
The deal could be big business for both the SPLM, who own 50 per cent of the company’s shares – worth an estimated $234 million – and Groves and Edmonds. The Block Ba oil filed is reported to contain around five billion barrels of oil, which in a time of mounting oil crisis, could prove vital in sustaining an independent southern Sudan.
Moreover, many oil experts predict that there are other untapped oil fields across southern Sudan and even in other parts of East Africa.
Despite Total’s opposition, White Nile has started a $16 million exploration on the Block Ba concession, meaning that a battle over ownership rights may go to court. But in White Nile’s favour is that the SPLM want to continue their relationship while Total’s posturing has caused bad feeling with the southern Sudanese.
“We like to think that we are reasonably good at judging risk.”