South Sudan boosts oil production with Chinese help
South Sudan Minister of Petroleum, Mining and Industry Stephen Dhieu Dau said he has ordered oil companies to step up production, he told reporters after his meeting with the Chinese Ambassador to Juba Ma Qiang.
China wanted to give the Republic of South Sudan one billion to two billion through the exit bank of China,” Dau said, explaining that 40 million US Dollars of the grant will be used to develop the oil and mining industry in the fledgling nation.
In block three and seven in Upper Nile we were producing 170,000 barrels per day.”
He explained how South Sudan once produced around 190,000 barrels a day in each of the South Sudanese oil fields.
He pledged that stronger oil flow was set to resume: In block three and seven in Upper Nile we were producing 170,000 barrels per day because of the shutdown situation. In Unity we were producing around 20,000. Now we should be going up to over 200,000 barrels in Upper Nile in block three and seven while we are now also increasing the production in Unity State,” he said.
The move came after the Sudanese President Omar Hassan Al-Bashir last Tuesday, September 3, lifted his threats to freeze South Sudan’s oil flow following a high-level meeting with South Sudanese President Salva Kiir, Dhieu said.
Earlier this year, Bashir threatened to shut down South Sudan’s oil flow -- its economic lifeline -- after accusing Juba of backing rebels fighting his government in South Kordofan and Blue Nile states, increasing tension between the two long-standing enemies. Juba denied the allegations.
Dhieu said the government planned to reopen some of the oil wells which were shut down in 2012 after South Sudan accused Khartoum of tapping into its crude supply.
Next Thursday we are visiting Unity State to commission one oil field called Tor which was brought down since the production shutdown in 2012. The oil field of Tor will be producing 5,300 barrels a day,” he said, adding that oil fields in Pariang County of Unity State and another oil field called Anar would also be brought back into operation.
South Sudan’s Minister of Petroleum and Mining Stephen Dhieu Dau (centre), October 18, 2012.
In January last year South Sudan froze its oil production on suspicion Sudan was stealing some of its oil from the pipeline that runs through its country. Until that point, oil had provided South Sudan with 98 percent of its income. The shutdown lasted well over a year until an African Union mediated deal was signed between the long-standing rivals in September last year in Addis Ababa.
Since oil production resumed in May, South Sudan has made almost one billion US Dollars from sales of its key export.
The conditions of the loan from China were still under discussion, said Dhieu. He said it would be used for major infrastructure projects like roads, electricity, agriculture and to invest in the potential industry like sugar and cement projects.
Ma Qiang said the offer is aimed at improving cooperation between China and South Sudan. Dhieu said the move will allow South Sudan to offer China a lion’s share of investment opportunity in the young country.
China is already one of the largest investors in South Sudan’s oil industry.
