South Sudanese soldiers stand during President Salva Kiir's visit to an oil refinery in Melut, Upper Nile State |
By
Garang Malak, JUBA South Sudan
Ethiopia
will soon start importing cheaper refined oil from South Sudan to substitute
the more expensive product from the Middle East.
Koang Tutlam, Ethiopia's State
minister for Mines and Petroleum, announced on Wednesday that this will save
Addis Ababa 15 per cent to 20 per cent on the $3.4 billion it spends importing
close to four million tonnes of refined products.
“We import almost all of our
oil and other refined products from the Middle East, but owing to the proximity
of about 200km between the oilfields of Pagak and Adar and the Ethiopian
border, we stand to save so much,” Mr Tutlam told journalists attending the
two-day South Sudan Oil and Gas Conference in Juba.
The conference was organised
by South Sudan's Petroleum Ministry in partnership with African Oil and Power,
an organisation that brings together ministers and senior government officials
and top executives of private sector companies spanning the energy value chain.
It is meant to explore ways of
utilising oil resources to achieve economic stability. Delegates came from
Kenya, Ethiopia, Egypt, Somalia, Norway, the US and South Africa.
Mr Tutlam said his country
exports hydroelectric power to South Sudan and will soon export about 400MW to
Kenya.
South Sudan has the
third-largest oil reserves in sub-Saharan Africa estimated at 3.5 billion
barrels, most of it unexplored.
He noted that if the
revitalised peace process that is anchored on championing stability and
economic recovery comes to fruition, Ethiopia will become a big market for
South Sudan’s oil.
“I think all will be well
after two to three years after which the two countries can put up
infrastructure that will benefit both nations,” he said.
At the same time, South Sudan
and Egypt signed a co-operation agreement in downstream oil and gas operations
in which Egypt will install gas facilities across South Sudan.
Juba’s undersecretary in the
Ministry of Petroleum Mayen Wol signed the agreement with Egypt’s state oil
company, Egyptian National Petroleum Corporation.
The agreement was one of the
highlights of the conference where Juba also announced it will be floating 14
oil blocks for exploration from early next year.
Other Egyptian companies in
attendance were Petrojet, Petrogas, Al Khorayef and Drexel Oilfield Equipment.
Recently Egyptian President
Fattah Al-Sisi asked Egyptian oil exploration and production companies to
venture into Sub-Saharan Africa and specifically asked companies to invest in
South Sudan.
Last week, Sudd Petroleum
Operating Company announced it would resume oil production at the end of the
year. Its oilfields, which produce 80,000 barrels per day and were shut in
2016. They could boost the country’s oil output substantially from the present
178,000 barrels per day.
And last week in Sochi,
Russia, President Al-Sisi who holds the chairmanship of the AU for 2019,
affirmed Egypt’s continued support of the people of South Sudan and efforts
aimed at achieving a final, peaceful political settlement in Juba.
South Africa’s Strategic Fuel
Fund, which signed an exploration and production sharing agreement in May 2019,
said it would start aerial surveying of block B2 in December.
“We hope to reach an oil
output of 250 000 barrels per day in the near future with the support from our
partners and neighbouring countries,” said South Sudan Minister of Petroleum
Daniel Awow Chuang.
Realising that goal, however,
depends on President Kiir and rival Riek Machar forming a government of
national unity on November 12.
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