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South Sudan elites using oil money to fund militias and get rich, says report

March 5, 2018 (JUBA) - South Sudan’s elite is using the country’s oil wealth to get rich and terrorize civilians, documents reviewed in an ongoing investigation by The Sentry, an investigative initiative co-founded by George Clooney and John Prendergast, has shown.

A pipeline that transports crude oil from the south to Port Sudan (Reuters)

The report details how revenues from oil resources, the country’s main resources of revenue, are used to fuel militias and ongoing atrocities, and how a small clique continues to get richer while the majority of South Sudanese suffer or flee their homes due to conflict.

Since its independence, South Sudan has relied on oil for all its incomes, a situation that has significantly compounded the ongoing political and economic instability, due to the fall in crude oil prices.

South Sudan got the lion’s share of the oil when it split from Sudan in July 2011, but it’s only export route is through Sudan, giving Khartoum leverage and leading to ongoing pricing disputes.

Oil production in South Sudan has, however, been affected by the conflict that erupted in 2013 after a political disagreement between President Salva Kiir and his then deputy, Riek Machar, triggered war.

The war in South Sudan, which has featured the use of child soldiers, rape as a weapon of war, and mass atrocities, has resulted in tens of thousands of deaths and has left over 4 million people displaced.

According to The Sentry’s report released on Tuesday, South Sudan’s state-owned oil company has been "captured by predatory elites" and is being used to fund the country’s civil war, including a government-aligned militia accused of human rights abuses.

Millions of dollars in oil revenue are being funneled from Nile Petroleum into the nation’s national security service, footing the bill for the war, now in its fifth year, says Global Witness, the report says.

More than $80 million was paid to South Sudanese politicians, military officials, government agencies, and companies owned by politicians and members of their families, according to The Sentry, an investigative group co-founded by George Clooney. The oil company made security-related payments from March 2014 until June 2015, according to The Sentry, which obtained a log of payments kept by the Ministry of Petroleum and Mining.

Nile Petroleum has, however, denied the company’s alleged involvement in funding military activity and says the money is being used for community projects such as roads, schools and hospitals.

"We can’t fund militia, it’s not part of our job," said Yiey Puoch Lur, the public relations of Nile Petroleum told Associated Press, AP Tuesday.

The document titled, “Security Expenses Summary from Nilepet as from March 2014 to Date” (“the Summary”) lists 84 transactions spanning a 15-month period beginning in March 2014 till June 2015.

One key document, part of a collection of material provided to The Sentry by an anonymous source, appears to be an internal log kept by South Sudan’s Ministry of Petroleum and Mining detailing security-related payments made by Nilepet, an extract of the report shows.

For instance, it says more than $80 million was recorded as paid to South Sudanese politicians, military officials, government agencies, and companies owned by politicians and members of their families who were, according to the Summary, paid for services such as military transport and logistics to forces implicated in atrocities.

It also implicates the South Sudanese petroleum ministry for aiding the provision of food, fuel, satellite phone airtime and money to a group of militias in Upper Nile state, one of the country’s oil-producing regions.

The militias, it stated, are reportedly responsible for destroying villages and attacks against civilians, including a February 2016 attack against civilians at a U.N. site in Malakal that left dozens dead.

Also mentioned in the report is the involvement of Interstate Airways, an entity partially owned by South Sudan First Lady Mary Ayen Mayardit, which reportedly received six payments beginning in April 2014 for army logistics and transportation of military hardware.

Another company, Nile Basin for Aviation, said to be owned by family members of top military and government officials, including the wife of ex-military chief of staff Paul Malong and a nephew of the current finance minister, Stephen Dhieu Dau reportedly received payments from Nilepet in 2015 for military logistics operations.

The spokesperson for the presidency, Ateny Wek Ateny, however, dismissed the accusations on The Sentry’s report as "fabrication" designed to damage its image.

“The oil money did not even ... buy a knife. It is being used for paying the salaries of the [country’s] civil servants,” Ateny told Reuters on Tuesday.

South Sudan is not looking for guns now, South Sudan is at peace. I don’t know why The Sentry is putting wrong stories against South Sudan,” he further stressed.

The US, the European Union and the international community should counter South Sudan’s "violent kleptocracy" by investigating top officials and imposing "network-focused sanctions," The Sentry urged.

The use of sanctions related to the oil sector, it also proposed, should also expand beyond designations of key officials and their companies, adding such a measure could have impact given the ubiquitous use of the U.S. dollar in the oil sector.

(ST)