Advocacy group Global Witness has sounded the alarm over an oil deal the South Sudan government is negotiating with Spain’s Star Petroleum, warning that it could result in environmental damage in South Sudan and harm the livelihoods of farmers and herders.
"South Sudan’s first post-independence oil deal is high-risk and in urgent need of further scrutiny," Global Witness said in a report released this week.
"From our research, it’s not clear that doing a deal with this company will benefit ordinary people," Global Witness' South Sudan campaigner Emma Vickers said in a statement.
Global Witness said the government of South Sudan must prove that granting Star Petroleum licenses for two large oil blocks will help, not harm, farmers and cattle herders who depend on the land where the oil is for a living. It listed a string of other reasons to explain why it is wary of the deal with Star Petroleum.
"The company is closely connected to a businessman convicted of a million euro fraud; no information about who owns Star Petroleum is available to the public... the company isn’t producing oil anywhere else in the world; the deal is being negotiated behind closed doors," it said in its report.
Ignacio Lacasa, the head of Star’s legal department, told South Sudan in Focus by email that the Spanish company will take care not to damage the environment or the livelihoods of farmers and herders. His email also refuted many of the claims made by Global Witness against Star Petroleum.
Star Petroleum is not the first foreign oil company to have its business dealings with South Sudan come under the microscope.
Before fighting broke out in South Sudan in December last year, the government was mulling conducting an environmental audit of all foreign oil companies operating in the country, Luke Patey, author of "The New Kings of Crude," which tells the story of how oil has shaped relations between South Sudan and foreign countries, said.
"To my knowledge, the audit has fallen off the priority list for obvious reasons," Patey told South Sudan in Focus in an interview.
"That is unfortunate because the spotlight has never been properly shone on what happened to the environment during the oil years, during production because there was a conflict going on," he said.
"Everyone's attention was on how oil was fueling the war. No one was looking at how it was impacting local communities, and how it was impacting the environment in South Sudan," he said.
Patey said the oil industry has already negatively impacted the environment and livelihoods of pastoralists and farmers in South Sudan -- just as Global Witness fears a deal with Star Petroleum would.
"It's usually the dumping of chemical waste from oil production or the poor holding of water that comes out fo the ground when oil's produced," Patey said.
"Because there's no enforcement of environmental laws, because there's a lack of infrastructure in the oil regions, oil companies often take the easy road and make large pits to hold this waste and produced chemical water that not only livestock but the population itself has come into contact with," Patey said.
He said South Sudanese have fallen ill and cattle have died after coming into contact with waste from oil production.
Attempts to reach someone at the Ministry of Petroleum and Mining in Juba for comment were unsuccessful.