Tharjiath oilfield in Unity State. (Photo: Courtesy).

The Civil Society Coalition on Natural Resources (CSCNR) is calling on the government to withhold the right to divest Petronas Carigali Nile Limited (PCNL) from South Sudan until the publication of an environmental audit report.

The Malaysian oil firm announced in August 2024 that it was withdrawing from South Sudan as part of its long-term investment plan. The energy firm said the decision was made following two years of divestment initiatives, which started on the same year that South Sudan launched an environmental audit on oil companies.

In a press statement on Sunday, CSCNR demands enforcement of a measure that will deny Petronas Carigali Nile Limited the right to sell its over $1 billion assets until the release of an environmental audit on oil companies.

The coalition claims that the foreign oil subsidiary has violated the South Sudan Petroleum Act 2012, acceptable international standards, and corporate social responsibility principles while operating in the country.

The group called on the Ministry of Petroleum to facilitate the release of Environmental Audit Report so that it could be ascertained whether or not there was an environmental pollution in accordance with the provision of the South Sudan Petroleum Act 2012.

The statement argued that oil companies have contributed to the ongoing armed conflict and violations against civilians in their areas of operations. It urged the government to pursue the rights to remedy of victims and families who faced human rights violations.

The group urged Juba, through the Ministry of Justice, to seek the indictment of Petronas executives who operated alongside officials of Swedish oil and gas firm Lundin in an international justice system.

According to the civil society body, Petronas assets should be subject to scrutiny as it took part in environmental pollution and its related impact on humans and biodiversity—an allegation that is yet to be substantiated by the pending audit.

Environmental Audit

In May, the South Sudan Minister of Environment told the parliament that the environmental audit report on the oilfields was almost complete but that the contracted companies had withheld the findings due to non-payment of their dues by the government.

The environmental audit was commissioned in 2022 by the Ministries of Petroleum and Environment, which contracted three companies to carry out the assessment.

Following Petronas’ withdrawal, Savannah Energy, a UK oil and gas company, was poised to take control of substantial operations across three joint operating companies (JOCs) in South Sudan.

The operations include interests in Block 3/7, 1/2/4, and 5A in Unity State and Ruweng Administrative Area, which began production in 1999, and pump out an average of 153.2 thousand barrels of oil per day in 2021.

However, the British oil firm later said parties were unable to finalize agreeable terms, leading to the cancellation of the deal.

South Sudan’s state-run Nile Petroleum then took control of the local oilfield and assets and said it was seeking international partners to both sustain operations and increase output at the blocks.

Meanwhile, Petroliam Nasional recently said its unit had initiated proceedings against South Sudan for allegedly blocking a $1.25 billion sale of its local assets and instead taking over the business.

Oilfield pollution

Early in September, South Sudan’s Minister of Investment said oil companies operating in the country, including the outgoing subsidiary of Petroliam Nasional Bhd, should restore the environment after years of widespread degradation.

In an interview with BNN Bloomberg, Dr. Dhieu Mathok accused Petronas of failing to carry out an environmental audit and paying damages to local communities when it abandoned its operations last month.

Environmentalists say South Sudan experienced environmental damage, deforestation, soil and water contamination, and health issues in and around the oil-producing areas.

The civil war that started in 2013—just two years after independence—was seen to have prevented the proper management of the environment.

In the past, the Ministry of Petroleum and oil companies came under increased criticism over oil leakages that reportedly contaminated the ecosystem around the oil-producing areas.

Both local and international campaign groups have reported widespread environmental pollution, as chemicals from oil wells are said to have been washed to settlements by floodwaters, leaving animals and people affected.

Reports emerged of women giving birth to deformed babies and stillbirths, which were subsequently confirmed by the indigenous community.

In 2015, German human rights and relief organization Sign of Hope said the health of more than 180,000 people in northern Unity State was at risk due to drinking water contaminated by crude oil.

The study found that oil operations released 8.3 million tons of salt, 7.9 billion liters of well-drilling fluids, including lead, nickel, and cadmium, and 6 million liters of crude into South Sudan’s soil between 1999 and 2020.

The contaminants affected communities in the oil-producing regions severely, depriving them of their rights to clean water, health, and life, according to the group.