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Sudan Tribune

Plural news and views on Sudan

Sudan Tribune

Plural news and views on Sudan

Economics

South Sudan reactivates oil pipeline talks via Kenya, Djibouti

South Sudan Finance minister Baak Barnaba Chol (PPU)

August 28, 2023 (JUBA) – South Sudan is in talks to reactivate plans to truck and build oil pipelines through Kenya, Djibouti, Ethiopia and Sudan,” the Finance minister said on Saturday.

“We are not only working hard to move away from relying on oil revenues but we are also working with our partners and countries in the region to help with transportation of oil using trucks and to build oil pipelines to Djibouti port through Ethiopia and also port Mombasa, Kenya,” Barnaba Chol Bak told the UN-sponsored {Radio Miraya}.

He added, “In the long run, we will explore possibilities to use ports of other countries through which we could export our oil to the international markets. This is to avoid relying on one export route”.

The minister revealed that the conflict in Sudan had prompted the leadership of the country to explore available opportunities to use in the event of the conflict taking a long to stop.

“We are not sleeping. His Excellency the President was recently in Kenya and before that, he was in Ethiopia where he had bilateral discussions with leaders from Ethiopia and Kenya. A memorandum of understanding has been signed and we are now working closely with our partners”, he explained.

Bak disclosed that South Sudan would like to use a road passing via Pagak and Malakal in Upper Nile state to the oil-producing areas within the region.

“If the conflict in Sudan drags on and it becomes a security issue to the export of the oil, we will use trucks to take the oil from Upper Nile states to Djibouti port through Ethiopia. There is a road from Pagak. We are working on that road.  We are also working on the storage capacity of our refinery in Bentiu. We have already started working on how to manage non-oil revenue and diversify our economy”, he explained.

Landlocked South Sudan still exports its crude oil to the international market through Port Sudan.

The young nation initially planned to construct an alternative oil pipeline but currently, the only pipelines taking oil to market pass through Sudan.

Analysts fear the current situation in Sudan could affect the flow of oil to the international markets if the rival factions in Sudan do not reach a peaceful settlement to the conflict.

Last week, Juba signed a memorandum of understanding with Ethiopia and Djibouti, which included possibilities of building an oil pipeline.
“As a landlocked country, we would like to have an outlet to the sea for our goods to go to the outside world and for our imports to come in”, noted Bak.
“We do not want to put all our eggs in one basket,” he said. We need to explore other ways”, he added.
Earlier reports indicated that an arm of the Toyota group had started a feasibility study into a pipeline through Kenya, although some analysts say the pipeline is not economically viable unless more crude reserves are discovered.
Although no progress has been made, the current situation in Sudan appears to have pressured Juba to mobilize resources to construct alternative routes to avoid depending on a single gateway to international markets.

(ST)

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