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November 19, 2002
Talisman Leaves Sudan But Remains on Social Investment Nix List
    by William Baue

Canadian SRI rating agency recommends investors continue to avoid investment in Talisman due to ongoing human rights and environmental concerns.

In response to shareowner concerns over human rights abuses, Calgary-based Talisman Energy (ticker: TLM) recently agreed to sell its 25 percent interest in the Greater Nile Petroleum Operating Company (GNPOC) in civil war-torn Sudan. Although this move might seem to clear Talisman's tarnished reputation for supporting human rights abuses, the socially responsible investment (SRI) community remains skeptical. Toronto-based Michael Jantzi Research Associates (MJRA), Canada's leading socially responsible investment (SRI) rating agency, issued an alert last week recommending that social investors continue to avoid investment in Talisman.

MJRA finds little reason to believe that Talisman's human rights record in Sudan will improve in its newest operations in Colombia, a country similarly torn by civil war and a history of human rights abuses by oil companies.

"Talisman has not proved itself capable or willing to deal effectively with human rights issues in Sudan," MJRA Senior Research Associate Ian Bragg told "And there are many such issues in Colombia."

Furthermore, Talisman continues to underperform environmentally.

"According to MJRA's Best-of-Sector analysis, Talisman Energy ranks in the bottom third of all oil and gas exploration and production companies listed on the S&P/TSX Composite Index," states the MJRA alert, which was released last Monday.

The alert cites evidence of Talisman's complicity in Sudanese human rights abuses in reports from a number of credible sources.

"All the reports are clear, whether it be the Canadian government's Harker report, the Gagnon/Ryle report, the Human Rights Watch report, or the United Nations reports, that people were killed to make way for oil development," said Mr. Bragg. "Attacks by helicopter gunship and bombers on the civilian population in the oil concession are well documented. The frequency of these attacks increased since Talisman acquired the concession. Also, as these reports document, the government of Sudan used the GNPOC airstrip to launch attacks."

Talisman's own 2001 Corporate Social Responsibility Report admits that "there were at least four instances of non-defensive usage of the Heglig airstrip in 2000."

However, Talisman contends that its impact on the people of Sudan was positive overall.

"We have long argued that Talisman's presence in Sudan has been a force for good
. . ." said Talisman President and CEO James Buckee.

According to Mr. Buckee, Talisman has provided medical assistance, shelter, clean water, and vocational training to the people of Sudan since the company acquired the GNPOC interest in October 1998 in its buyout of Arakis Energy. Countering accusations of the Sudanese government's forced relocation of local residents to make way for oil development, Talisman pointed to satellite photographs dating back to 1965 showing that the population has increased.

"Mr. Buckee claims that there has been a population increase in Talisman's area of operation," states anthropologist John Ryle in the October 2001 report he co-authored with Canadian lawyer Georgette Gagnon, entitled Report of an Investigation into Oil Development, Conflict and Displacement in Western Upper Nile, Sudan. "He makes much of satellite images that are said to show a growth in size of government garrison towns. But any expansion of these towns and military posts is not a sign of prosperity. It is the opposite: further evidence of the violent displacement of civilians from rural areas (the displacement that Mr Buckee says is not happening). This is presumably why malnutrition rates in government-controlled Bentiu town, as reported by the UN World Food Programme last month, are among the highest in Sudan."

Weighing Mr. Buckee's photographic evidence of Talisman's good doings against the evidence of its misdeeds documented through eye-witness reports and the company's own admission, MJRA reiterated its recommendation against investment in Talisman.


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