Home | News    Wednesday 9 November 2011

South Sudan sells oil cargo at four-year high amid conflict fears

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November 8, 2011 (KHARTOUM) – The newly independent state of South Sudan managed to sell, via tender, a cargo of Nile Blend crude for December. It will load at the highest premium in at least four years and is fueled by fears of possible conflict with its northern neighbor, traders told Reuters on Tuesday.

Traders work in the oil options pit of the New York Mercantile Exchange (AP)

South Sudan is the world’s newest nation as of July after its citizens voted in January to secede from the Arab-Muslim dominated north.

The new nation took with it 75% of Sudan’s oil reserves but remains dependent on the north to transport and export its oil to the outside world.

Sudan and South Sudan have yet to agree on oil transit fees to be assessed for using the north’s oil infrastructure. The two nations are now in deeply strained relations amid accusations that each side is supporting rebel groups on the other side of the borders.

Traders today said South Sudan sold the 600,000-barrel cargo to Chinaoil at a premium of $1.20 a barrel to Indonesia Crude Price (ICP) Minas.

It also sold a second cargo to European trading company, Trafigura at a premium of 90 cents a barrel to ICP Minas.

Nile Blend’s spot premium last surged more than $1 a barrel in 2007 when a massive earthquake rocked Japan, they said.

The heavy sweet crude is popular among North Asian refiners and is typically processed in complex refineries to produce feedstock for fluid catalytic crackers.

In a separate tender, South Sudan sold 3.8 million barrels of Dar Blend crude for December loading at a narrower discount than the previous month, partly on stronger fuel oil cracks.

The cargoes were sold to Chinaoil, Unipec and Vitol at around $8 a barrel below dated Brent, traders said.

DIMINISHING PRODUCTIVITY

In a related issue, South Sudan officials said that oil productivity from wells in Unity state have dropped as a result of variety of factors.

Unity State oil minister William Garjang Gieng said according to Reuters that only 15 of 138 wells are operating in Unity and Mid oil fields, causing the state’s output to drop to around 80,000-95,000 barrels per day (bpd), down from around 115,000-120,000 bpd.

Some of the wells could not be accessed during the rainy season because Sudanese staff, materials and road-building equipment pulled out before independence, he said. He expects production to bounce back to normal early next year.

"There are some wells that have problems and they need to be reworked by the service rigs, but they don’t have access to the roads because that is a swamp area," Garjang told reporters in Bentiu, the state capital, late on Tuesday.

"The other problem that is facing people is the (amount) of manpower that is working in the area."

Unity oil field, the largest of three in the state, is run by Greater Nile Petroleum Company, a consortium of national oil companies from China, Malaysia, India and South Sudan.

(ST)

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  • 9 November 2011 11:38, by SSLA supporter

    It is obvious that this country run by the corrupt and naïve SPLA/M mafia is beig turned into a fortune for some opportunist foreign companies that are immensely exploiting the SPLM’s incompetency and corruption. RoSS will be turned into a consumer commodity by some of those greedy oil companies simply because the regulatory system there is tainted by corruption. What sense it makes for...

    repondre message

    • 9 November 2011 12:52, by angunliach

      No thing we can do now, CPA was signed for the South to prepare for the last five year, then president and his men were paying attention on stealing of public fund until we are caught with nothing done, can you use enemy’s route for business,he can not allow you completely, please you store this oil until corrupted government left, right government will use that oil.

      repondre message

    • 9 November 2011 13:23, by Logic

      Mr Supporter

      Why you so angry at S. Sudan, is it because she separated and chose an independent destiny?

      repondre message

  • 9 November 2011 11:43, by SSLA supporter

    for the 6-years old government to be unable to access some of its oil wells? What if those oil wells are being exploited by whoever have access to them? How could you call yourself an independent government if you are not in full control of your country, resources, decision etc?

    repondre message

  • 9 November 2011 12:16, by SSLA supporter

    If the oil wells in those swamps of the unity state are left unattended, then how the local or the central government could be so sure that they are not leaking and thus not polluting the ecosystem there? Has the so-called government in Juba really put some regulatory measures to curve the environmental pollution by those oil companies? If there is any pollution then it will be passed down the...

    repondre message

  • 9 November 2011 12:22, by SSLA supporter

    ...food chain to the locals who are entirely depending on water and fishes from those marshlands. We must keep an eye on those companies as we don’t want the Nigerian disaster caused by the environmental pollution by Shell Oil Company in Delta Niger of Nigeria to be repeated in RoSS.

    repondre message

  • 10 November 2011 14:55, by Abu sala

    How do you trust the source of this information...
    i doubt but if it trust i would say WTF....

    repondre message

  • 24 April 2013 16:20, by dennishobson

    xG33PUCQ6k673YpopfvV0edpm65Jrtssanyong madeira plastica composite decking When I originally commented I clicked the -Notify me when new comments are added- checkbox and now each time a comment is added I get four emails with the same comment. Is there any way

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