Sudan sees crude output over 500,000 bpd by August

BEIJING, May 21 (Reuters) – Sudan’s crude output is likely to top 500,000 barrels per day by August, Foreign Minister Mustafa Osman Ismail said on Saturday, adding that he was discussing further Chinese investment for the country’s downstream sector.

A Chinese-led consortium is also expected to start work soon on a new block, Ismail said during a trip to China, but declined to say which firms were involved.

“We are expecting production by August to be more than half a million barrels per day,” Ismail told a news conference.

The country’s new, heavy sweet Dar Blend crude is due to come on stream in July in the Melut basin on blocks 3 and 7, in the southeast of the country.

Sudan currently produces about 300,000 bpd of medium-heavy sweet Nile Blend, but will reach half a million barrels per day when the new field’s expected initial output of 140,000 barrels per day climbs to 200,000 bpd.

The rise is good news for oil markets, which are counting on non-OPEC production to thwart an expected end-year oil supply crunch, a Reuters survey found in April.

NEW CHINESE BLOCK

“The new block, which China is going to participate in, is block 15…We are expecting in the very, very near future the consortium to start its work in that block,” Ismail said.

“It is going to include China as the main shareholder beside Malaysia, Nigeria, and Sudanese firm Sudapet,” he added.

He declined to comment on which firm was heading the consortium — state owned giants CNPC and Sinopec Group both have a presence in the country — or how much the deal was worth.

Ismail said Sudan would also hold talks on further Chinese investment in downstream facilities during his trip. CNPC is already a major investor in a Khartoum refinery.

“What we are going to discuss…is more investment, particularly in the field of petrochemicals, refineries and pipelines,” he told journalists.

Much foreign investment in Sudan comes from state-owned firms in China, India and Malaysia.

But Ismail said that Sudan, which in January signed a deal to end more than two decades of war in the south, would welcome investment from Western firms as it rebuilds.

“Western investors are welcome in Sudan. Maybe in the past because of the war they could not come. Now the war is over.” he said.