Home | News    Thursday 21 July 2011

Controversy looms over Nile Petroleum, Glencore joint venture

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July 20, 2011 (JUBA) - An MP from South Sudan’s parliament has requested that further inquiries are made as to the suitability of Glencore International - a Switzerland-based firm - to enter into a joint venture with South Sudan’s Nile Petroleum Corporation (Nilepet).

Marc Rich (AP)Marc Rich, founder of the company was - until a presidential pardon in 2001 - was wanted in the US by the Federal Bureau of Investigation’s (FBI) for massive tax fraud.

The merger, according to Mangok Kali Mangok, Nilepet’s managing director was meant to ensure that crude oil entitlements from the company and the Republic of South Sudan in general, find international markets.

However, a South Sudan MP has said that the national oils company risks being duped by entities like Glencore, with “unclear and lacking proper records.”

“We need to institute proper inquiries into such joint ventures like the one between Glencore and Nile Petroleum Corporation. As South Sudanese, we risk loosing to investors, if we do not trade professionally,” the legislator, who preferred anonymity, told Sudan Tribune on Wednesday.

Glencore’s founder, was in 1983 indicted for evading more than $48 million in taxes, and charged with 51 counts of tax fraud, as well as running illegal oil deals with Iran during the US’s 1979-1980 hostage crisis. He was pardoned controversially on Bill Clinton’s last day in office at White House.

“Some questions have still been left answered. This leaves South Sudanese wondering as to why Nile Petroleum opted to enter into a joint venture with this company [Glencore International] before tracing their background,” said the South Sudan-ruling party legislator.

Speaking from Sudan’s capital, Khartoum, Nilepet’s managing director downplayed these fears, saying his company has already done researched the company before entering the partnership.

“I cannot comment on such allegations of criminality involving Glencore International. As Nile Petroleum, we viewed the profile of this company and we were impressed. That is how we formed a joint venture,” Mangok told Sudan Tribune.

Under the deal, he added, Glencore will assist in marketing South Sudan’s crude oil, ensuring that it conforms to international standards, in addition to offering other capacity building initiatives.

But David Loro Gubek, the Energy and Mining ministry’s undersecretary said Glencore and Nilepet were simply partners in business and that the joint venture was just a “local partnership” that excluded a Memorandum of Understanding (MoU) between the two.

“Some media mistook this joint venture to be an agreement that, which was a misrepresentation. For any agreement such as a memorandum of understanding to be reached between two entities, it has to be at a ministerial level, not between companies,” Gubek told Sudan Tribune in a separate interview.

He denied reports that Glencore would be the sole company involved in marketing the new country’s crude oil, arguing that the process cannot involve only a single entity.

The joint partnership between the two, he added, was simply the outcome of cooperation among the top leaderships in these companies, citing the recent fuel crisis that hit South Sudan, where the Nilepet and Glencore jointly supplied fuel from Kenya to be used during the July 9 independence celebrations.

In March, South Sudan’s Energy and Mining ministry and Petroliam Nasional Berhad (PETRONAS), a Malaysian-owned oil and gas company signed a two-year memorandum of understanding (MoU) aimed at boosting mutual cooperation between the two parties.

The MoU, signed in Juba, South Sudan’s capital, outlined the overall principles of cooperation in the oil and gas sector between the government and the Malaysian oil giants, creating an avenue for exploiting existing business opportunities.

(ST)

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  • 21 July 2011 06:38, by Emmanuel Ajang Solomon

    MP. I think if U people have start fearing our Government because the president can sack U from your seat, why did U gave him such powers and U did knew very well all this will be a source of problems in the New Nation.

    since the company have records of Corruption and was pardon at the last hours.Why talk of Fuel crises and it has cause problem between Pagan and Lual Acuek with other big senior members and will cause more problems after the formation, or announcement of New Government of Republic of South Sudan.

    repondre message

    • 21 July 2011 07:10, by Nyachebe

      I don’t understand how and why my people are contracting and signing oil deals with countries that had have helped least during the long quest struggle for our freedom from Arab.

      It was USA, Canada, some Europe, UK and Australia that have helped and contributed amicably to this lasting freedom. Even Jesus was given to the world because at last people would abide with His Father. These countries were not helping with out a benefit be pay back to them.

      But denying them contracts is a big shame and it’s a childish behaviour where you give a child a candy, the same child would right a way forget and may attempt to insult the very one helped them. If we are not careful chance is that we will lose this big alliances like USA and so… and ended up at the hand of communist communities.

      Chinese and Asia were the ones killed us by selling the northern regime sophisticated weapons that have engulfed dear lives.

      Major priorities should be given to the western countries, since they will help developing the local projects as well as complying with international standards.

      South Sudan Oyeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee

      repondre message

      • 21 July 2011 09:20, by Runrach

        Thank a lot Mr/Mrs.Nyachebe and accept my brotherly apology for the above misaddressing.However, most South Sudanese communities used the prefix Nya.for the description of female names while others use it for both male and female as well, hopefully you could be getting me very clearly.

        To your input, our leaders fail to understand/recalled the western contributions to our nation ever since until we gained our independence few weeks ago.It is indeed regretably for us as a nation to simply forgot those western countries whom you have just mentioned earlier in your comments especially the USA and Noriegian government just to name a few. What kind of reward our government planning to provide to these countries if one could ask a question? I thought we could provide them with some contract if they have some sort of skills and experiencs in some areas according to an international petroleum expertise regulations.

        More importantly,our government needs to understand that, which countries contribute to our humanitarian needs during the post 21 years of an intensive fighting instead of catering some major contracts with Chinese .I do believe we all aware that Chinese and Russian government were the biggest suppliers of Khartoum government in term of military hardwares as well as air supplies and that was because of our oil.In reality I don’t understand why our government still trust them for oil contract?

        Above all let wait and see how Kiir’s government gonna deal with them.

        repondre message

    • 21 July 2011 07:42, by Bigcat

      I reject Glenmore oil company, and replace it with norway oil company, american company and total, france company. this company shuold signed south oil contract.. i also dismissed malaysian oil company because that is not really malaysia oil company is just a combination of china, indonesia in the name of malaysia.!!!u people in juba don’t know this malaysia trick?

      Message Goss, u better hire expert people with better political skill if u luck eople!

      repondre message

  • 21 July 2011 08:39, by Niko

    I hope they rob the SPLM blind. What have they done with the oil money over the past 6 years anyway.

    repondre message

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