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36 N.Y.U. J. Int'l. L. & Pol. 425 (2003-2004)
Oil and Politics: Talisman Energy and Sudan

handle is hein.journals/nyuilp36 and id is 433 raw text is: OIL AND POLITICS: TALISMAN ENERGY AND SUDAN STEPHEN J. KOBRIN* I. INTRODUCTION On March 9, 2003, Talisman Energy, a large Canadian in- dependent,' sold its 25% share of the Greater Nile Petroleum Operating Company (GNPOC) in Sudan to a subsidiary of In- dia's national oil company for about $771 million.2 Talisman had been in Sudan for less than four years, purchasing its 25% stake from Arakis Energy, another Canadian independent, in October 1998.3 At first glance the project appears to have been a spectac- ular success. In August 2000, two years after signing the con- tract, Talisman announced that it expected its current year's income to be four times that of the previous year and that it now pumped more oil and gas than any other Canadian com- pany.4 Oil production was consistently described as exceeding expectations: Sudan's 2001 output was up 16% compared to the previous year, production was estimated to reach 300,000 * Stephen J. Kobrin is the William H. Wurster Professor of Multina- tional Management at the Wharton School of the University of Pennsylvania. The author would like to thank Stephen Bell of BHPBilliton for his consider- able help with this project. 1. An independent oil company is distinguished from the vertically inte- grated majors in the industry in that it typically is both smaller and partici- pates in only a limited portion of the value chain. See, e.g., ALBERTO CL6, OIL ECONOMICS AND POLICY 44 (2000). Talisman Energy's operations involve ex- ploration, development, and production of oil and natural gas-upstream operations-but not refining or retail distribution. See Talisman Energy, Talisman Energy: About Us, at http://www.talisman-energy.com/aboutus/ aboutus.html (last visited Apr. 15, 2004). 2. Canadian Press, Talisman Completes Sale of Sudan Oil Interest, TORONTO STAR, Mar. 13, 2003, at C6. 3. Lily Nguyen, As Talisman Cuts Sudan Ties, Some Weigh Wisdom of Foray, GLOBE & MAIL, Mar. 13, 2003, at B1. 4. Tamsin Carlisle, For Canadian Firm, an African Albatross-Oil Driller Talisman Energy Pays a Painful Price for Its Sudan Investment, WALL ST. J., Aug. 17, 2000, at A19. 425 Imaged with the Permisson of N.Y.U. Journal of International Law and Politics

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