Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
March 3, 2010 (NAIROBI) – Toyota Tshusho Corporation has proposed to Kenyan officials to construct a 1,400-kilometer (870-mile) pipeline to transport crude oil from the landlocked South Sudan capital city to Lamu, a port on the Indian Ocean.
If constructed, the pipeline would provide an alternative to the country’s only current oil exporting point, Port Sudan, potentially having major economic and political implications on the whole of Sudan.
The idea was presented before in 2006 by Kenya Pipeline Corporation officials to Southern Sudan government officials. They said that Kenya’s regional position would give Southern Sudan unparalleled advantage in lead-time and sealing important business deals.
About 75 per cent of Sudan’s proven reserves of 6.3bn barrels are in the south but the pipeline that carries the oil to export terminals and refineries runs through the north. The south needs Khartoum’s co-operation to sell its oil; the north needs revenues from its neighbor’s resources.
An executive director of the Japanese company, in a presentation distributed to reporters today in Nairobi, disclosed that the pipeline would have a capacity of 450,000 barrels per day. It would cost $1.5 billion to construct. After 20 years under Toyota ownership, it would be handed over to the Kenyan and South Sudanese governments.
Kenyan Prime Minister Raila Odinga visited Japan last month; Kenya is said to support the proposal. Other stakeholders include China, which wants to develop a port and infrastructure at Lamu on the Kenyan coast.
The semi-autonomous South Sudan will hold a referendum on the question of independence in 2011. The proposed pipeline would vastly reduce the need for post-referendum economic and political cooperation between the South’s ruling party and their erstwhile foes in the North.
The separation of Sudan into a two states will deny the North billions of dollars in revenue generating from vast oilfields in the south of the country. Currently the North and the South are splitting the proceeds of crude in accordance with the Comprehensive Peace Agreement (CPA) signed in 2005.
Last month a senior GoSS official said that the South may continue to share oil proceeds with the North for a limited time following secession to prevent an economic collapse there.
Mr. Hattori said that the pipeline construction would be financed by Japan Bank for International Co-operation, if the bank agrees. This was reported by a Financial Times reporter who attended a briefing with Toyota officials in the office of the Kenyan prime minister.
“We haven’t studied in detail, but a partnership with other investors, governments, foreign companies is of course one of the options,” Mr. Hattori was quoted as saying by Bloomberg. “Maybe to collaborate with a Chinese company would be one of the options.”
It does not appear that Toyota has formalized any agreement with Southern Sudanese officials. But the ruling party of the South, which has some strongly separatist elements, might embrace this as an opportunity to reduce pipeline fees that will have to be paid to the Khartoum government under the present arrangement.
Toyota Tshusho is the trading company of Toyota Motor Group, the Japan-based business conglomerate that is one of the world’s largest. Tsusho’s vision to increase the non-automotive share of its operating revenue balance, according to its website. The trading company has an office in Nairobi and may make additional acquisitions in the energy sector in Kenya.
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Dinka Boy
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
I wish it cost less when building Pipline from South Sudan to Kenya. Yes, this plan was in the proposal of South Sudanese.
Samson
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
THAT WAS A VERY SMART MOVING THE GOVERMENT OF SOUTH SUDAN, KEEP WORKING. DO NOT LET THE ENEMIES SMARTER THEN YOU!
murlescrewed
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
This would give South the economic leverage it needs to counteract any moves by the North. South should continue to pursue economic cooperation with north in post referendum environment. However, it needs to also become the economic powerhouse of its own in East Africa and building a pipeline will the vein needed to cement our relations with our southern neighbors. So South should definitely consider this move.
Deng Akol Agut-tungdoun
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
That is it Toyota,
We are serous with those who mine business and politically motivated business as the monkey eyed Chinese are doing in Sudan.
With your peaceful wind as Japanese, we shall maximumily co operate. Our oil our liberty! No more chinese wanted in our land. Kenyans are our best friends, our best neighbours.
Be bless,
Deng Akol Agut-tungduon, a man far away from tribalism and corruption.
AAMA
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
This is a good move for the south if it is planning to cut off its relations and/or dependency on the north. Off course, from an economical point of view it’s ridiculous as there is an existing and an already operational pipeline. But for politics, it can make the south less dependent on the north (NCP to be precise if they continued in power after elections) regardless of the cost and time it will take.
Kenya off course dreams about this, as they are the biggest beneficiary of this bonus south oil that shall flow through their land unrning them extra $$$$ and that’s why it is promoting it. It will also allow them to control the south economically in all dimensions of life if the south separated. The choice on this is up to the south to decide what is better either economical cooperation with the north or political security even if it means losing large amounts of cash to a new foreign ally.
Peace.
Padiet Deng Alony
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
Better to share PipeLine with our brothers True African and whites than with those who call themselves Arab.Hi 20 years more, ten years better if there will be final agreement with GOSS.
PT92/Remember Mazlum Battalion
Time1
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
South Sudan president and government should approve this deal, this is a very reasonable deal and win win deal to all sides, If the Japanesew ill build it fund it and run it, then this is not a bad deal, instead of south paying money to n orth every year that money can go into the pipeline project with Japan or China, also we can trust Japan or China when it comes to business, they always mean what they say. GOSS and Kenya should consult and come out with a reasonable approval deal. If the Japanese can complete the Pipeline within 1 to 2 years then this is not a bad deal at all, but it will be a good idea to seek other partners as the Toyota officials said, the industry needs to be diversified instead of just dominated by one player, every one need to have a share.
Lorolokin
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
Hiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii,
Wonderful, what a great news to S.Sudan i wish 2011 comes as quickly as it can we are tired of Mundukuru as such we need Japanese than the fake chinese. I think Japan got it correct, Japanese are welcome to our territory without any delay.Is good to connect to our African brothers than Sub-Arabs Sudanese plus the Chinese who contributed to the killing of our People.
My Advise to Mubarak of Egypt is that,there is still time to cooperate with us before it is too late.
Mubarak don’t waste your time by every now and then inviting Kiir to Egypt for Unity with your Causin El Bashier,time hasv come for Southerners to be freeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee
even if you convince Kiir it is not Kiir who will vote, it is we Southern masses,Do you understand??
Shame.
Kinkak
Kur
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
This project has to be done now. It will cost money, but it brings us closer to our destiny.
Kur
Justin Chicago opiny
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
The pipeline to port Lamu on the Kenyan coastal on the Indian ocean is ideal as it shortens the distance to oil hungry countries like china,India,malaysia and other rapid developing economies in Asia. The pipeline in question would have been finished more than 3 years after the signing of the CPA as it was planned by the late Dr.John Garang alternatively the Kenya-sudan-Uganda railways would by now be ferring the crude to Lamu.
South sudan should waste no time planning to have its own oil refineries to produce oil and gas for home consumptions as we do not want to destroy our environment with chopping down trees for fuel wood. The refinery should be built in stragetic location such as in Jonglei state or Kapoeta in EES where the refined oil will find its way to the markets in southern African countries and Eastern African countries like Ethiopia and Kenya and to Uganda although they have oil off shore on lake Kyoga.
M.Cool.J
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
Yes,atleast one in any country than in Port Sudan.But are the southerners ready or responsible for any outcome?
Time1
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
If Japanese Toyota will put $1.5billion of their money to kick start the project, it should be a reasonable deal that should benefit all sides, so they can run it for say 10, 15 or 20years so they can get their 1.5billion back plus their profit for the investment, i think 15years should be also good if negotiated, also they should be allowed to share the project with another company preferably Chinese or other western companies.
Othogomoi
Toyota proposes Kenya-Juba oil pipeline bypassing Port Sudan
Although Kenyan are corrupted, let them benefit fromour oil, because there are African Brothers and there are better than Arab(Muslim)Terrorist who are using our oil money to sponsor terrorist to shed blood of innocent people.example southern Sudan, and Darfur are the victim of the activities
never let Muslim Terrorist benefit our oil again,look at Iran and syria, they are sponsoring terrorist movement to get rid of Israel.but thanks God Israelites will not give them chance.African is the second chosen children of God after Israel. we who are the last will be the first.