Swords of Sanghelios

The Covenant Separatists are a breakaway faction of the Covenant, led by the Elites and "officially" formed after they learned the truth about the Halos at the end of Halo 2.

Background
The Covenant separatists are made up of the Elite, Grunt, and Hunter castes within the Covenant's hierarchical society. The members of the faction were somewhat "united" at the beginning of the Civil War of the Covenant, but the faction was "officially" formed when they learned the truth of the Halos and since both times, have been fighting the Covenant Loyalists, led by the Prophets and their Brutes, Drones, Jackals and some Grunt and Hunter supporters.

It is speculated that this disgruntled faction is lead by the Arbiter, Ship Master Rtas 'Vadum and Imperial Admiral Xytan 'Jar Wattinree. It is possible the remaining Councilors command the faction from Sanghelios as aides to the Arbiter offering their counsel to him as they once did with the Prophets. Fronts of this war include holy city of High Charity, Installation 05, Earth, and areas of space where Covenant ships operate.

Origins of the Faction
The High Prophet of Regret led a botched mission to Earth and was forced into The First Battle of Earth upon discovering what turns out to be the Human homeworld. He escapes to Delta Halo, but is killed by the Master Chief, which is considered a significant failure in the Elites' oath to protect the Prophets.

The remaining Prophets, led by the High Prophet of Truth, used this opportunity to replace the Elites with the Brutes as their protectors. However, this move effectively shames and angers the Elites, who have been in such a position since the founding of the Covenant, and they threaten to resign from the High Council.

Truth then gives command of the Covenant fleets (the Elites' job) to the Brutes. Once there are enough Brutes in place, he secretly orders the Brutes to instigate a brutal genocide of the Elites, so they might replace them in society, disguised as a Brute insurrection against the Covenant and as an Elite revolt to the other Covenant factions (excluding the Brutes and the Prophets). The Elites respond, with the help of the Hunters and the Grunts, and war breaks out in High Charity. Later, the Councilors are assassinated by the Brutes at the behest of the Prophets. When the Elites learn the truth about the Halos, it changes the war significantly and adds the humans to the struggle. Instead of a Great Journey, the Gravemind's revelation regarding the superweapon contradicts the Covenant's belief system and is motivating at least the Arbiter in his eventual opposition to the Covenant as they try to activate Delta Halo later in the game.

Ironically, the separatist forces at Joyous Exultation may have helped turn the tide of the war in the UNSC's favor had it not been for Sublime Transcendence's destruction by a NOVA bomb. However, at that early point in the Great Schism, both sides of the Covenant still opposed the UNSC. As intergalactic communication is not instantaneous, it would have taken some time for an alliance to be forged and for all the elements of the Faction to be informed.

Weapons

 * Type-25 Directed Energy Pistol "Plasma Pistol"
 * Type-25 Directed Energy Rifle "Plasma Rifle"
 * Type-33 Guided Munitions Launcher "Needler"
 * Type-1 Energy Weapon/Sword
 * Type-51 Carbine
 * Type-50 Sniper Rifle System "Particle Beam Rifle"
 * Type-1 Antipersonnel Grenade "Plasma Grenade"
 * Type-33 Light Anti-Armor Weapon
 * Type-52 Automatic Plasma Cannon

Vehicles

 * Type-32 Rapid Assault Vehicle "Ghost"
 * Type-26 Ground Support Aircraft "Banshee"
 * (Undesignated) Spectre
 * Type-52 Troop Carrier (Phantom)
 * DX-class Spirit Dropship
 * Type-47 Ultra Heavy Assault Platform "Scarab" (Installation 05 Only)
 * Type-25 Wraith
 * Shadow

Commanders

 * The Arbiter
 * Rtas 'Vadumee
 * Surviving Councilors
 * John-117 (possibly)
 * Lord Terrence Hood
 * Miranda Keyes

Military

 * Elites (all)
 * Grunts (some)
 * Hunters (most)
 * UNSC (all)

Also involved in this faction is the UNSC Defense Force, which helped the Arbiter on Installation 05 with the killing of Brute Chieftain Tartarus. It is known that the alliance has helped each other in the Second Battle of Earth.

While the Arbiter and Lord Hood agreed peace and friendship between Humanity and the Seperatists, it is currently unknown how little or much this alliance will progress in the future, but it is expected by many to become official as the Elites have long respected a number of human traits which would otherwise draw a race into the Covenant, such as in Ghosts of Onyx, when Voro Nar 'Mantakree actually has a look of respect for Kurt.

Units

 * Fleet of Retribution

Trivia

 * This is not necessarily the first internal dispute in the Covenant's society; when the current Arbiter was assigned to his office, he was reminded by the High Prophet of Mercy that an Arbiter was necessary during the Grunt Rebellion, which was a conflict between the Covenant and its lowest caste, the Grunts.
 * Both the Grunts and Hunters are confirmed allies of the Elites. However, none are seen as anything but enemies in Halo 3. This maybe Bungie's decision to not confuse the player of who is enemy and who is ally, and there may have been Grunts and Hunters who fought with the Elites and Humans, during the last battles of the Great Schism.