US fund house exits ONGC over Sudan investments

TIAA-CREF, the world's largest private pension system, has sold its holdings in ONGC, PetroChina, CNPC Hong Kong and Sinopec over their investments in war-torn Sudan

US-based Teachers Insurance and Annuity Association-College Retirement Equities Fund (TIAA-CREF), the world's largest private pension system, has exited Oil and Natural Gas Corp (ONGC) and other Chinese energy firms over their investments in war-torn Sudan. ONGC, the State-run oil refiner, however, said that its operations did not support suppressive activities anywhere in the world.

TIAA-CREF has sold its holdings in ONGC, PetroChina, CNPC Hong Kong and Sinopec, the New York-based fund said in a statement.

The US fund house had a tiny shareholding in ONGC and stakes sold across the four companies constituted a small slice of its $402 billion assets under management, reports PTI.

"Our decision to sell shares in these companies culminated a three-year effort to encourage them to end their ties to Sudan or attempt to end suffering there," TIAA-CREF's chief executive Roger W Ferguson Jr said.

ONGC, which through its overseas arm ONGC Videsh Ltd (OVL) has 25% stake in Greater Nile Oil Project, said its business directly or indirectly does not support any 'suppressive' activities or human rights violations anywhere in the world.

"We at ONGC are very conscious that our operations do not cause any concern or (in) any way convey our support to any oppressive activity anywhere in the world," ONGC chairman and managing director RS Sharma told PTI.

Sudan is in the midst of a civil war that broke out in 2003 when Christian groups accused Khartoum of oppressing them in favour of Muslim Arabs.

ONGC said that it was concerned about TIAA-CREF'S move but the firm's business in Sudan would continue.

With the objective of securing energy security for the country, the State-owned firm entered oil-rich Sudan about seven years ago, buying 25% stake in the Greater Nile Project, from which Canada's Talisman Energy exited under pressure from human rights groups.

ONGC Videsh's entire investment was paid off in less than three years from the investment.

Mr Sharma said ONGC's operations in Sudan were far away from the conflict regions in the south. "We are conscious that we are in no way conveying any support to any suppressive activity anywhere in the world including our own country," he said.

The decision by TIAA-CREF would not impact OVL's decision to invest in Sudan, he said, adding that the State-run firm valued support from all investor groups and "feels concerned and pained" at withdrawal by any investor group.

"But we do not think there is any reason for us to withdraw or reduce our operations (in Sudan). We are not the oppressors or (in) any way supporting such acts," Mr Sharma said.

Last year in March, TIAA-CREF had announced plans to "intensify pressure on five companies (PetroChina, CNPC Hong Kong, ONGC, Sinopec, and Petronas of Malaysia) that maintain business relations with the government of Sudan to cease those relations or attempt to ease suffering and end genocide in Darfur."

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    Shadi Katyal

    1 decade ago

    Due to sudden activities of Al.Quida ,US Fund must hve decided to move on to safer places as this is a retired pension fund and need better earning

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