China downplays expulsion of Petrodar boss from South Sudan

February 23, 2012 (KHARTOUM) – The Chinese government on Thursday sought to downplay the decision taken this week by South Sudan to expel Liu Yingcai, the head of the Chinese-Malaysian oil consortium Petrodar.

South Sudan said it made this move because Yingcai did not honor the terms of reference of the memorandum of understanding which they signed in December.

The government accused Petrodar this month of lack of cooperation in the implementation of Juba’s decision to shut down oil production and negligence on the impact of oil operations on the environment.

South Sudan’s minister of information, Barnaba Benjamin Marial, said a government investigation found Liu was involved with the government of Sudan “in the conspiracy of getting the oil of South Sudan”.

Sudan decided late last year to start confiscating part of the oil pumped by South Sudan as payment in kind to satisfy financial arrears. This prompted Juba to retaliate by shutting down oil production.

China’s Foreign Ministry spokesman Hong Lei said China had seen the reports of Yingcai’s expulsion but would not comment on it directly.

“China and South Sudan’s cooperation is based on mutual respect and mutually beneficial equality, which brings real benefits to both peoples,” Lei told a daily news briefing.

“We hope that relevant sides step up communication and consultations and put an end to misunderstandings to benefit long-term cooperation,” he added.

Petrodar holds concessions in Palloj in Upper Nile state, where South Sudan was producing over 60 percent of its crude oil before the shutdown.

(ST)