Petroleum Minister, Ezekiel Lul Gatkuoth, told journalists in Nairobi on August 17, that fighting has slowed crude oil production in the country, but added that an assessment team aimed to restore oil fields’ output.
Gatkuoth said his ministry seeks to fix facilities especially in former Unity State that have been destroyed by the conflict, as well as boosting security at the oil-producing sites and wooing investors.
“We have sent a team to assess the oil areas in Dar Petroleum and also in Unity State,” Gatkuoth said, adding that performance should be restored by November.
He underscored the government’s plans to provide security to investors willing to invest in the oil sector.
Oil is essential to South Sudan, making up about 98% of the national budget.
Oil production dropped following the escalation of violence since 2013 in the country's two main oil producing states, Upper Nile and Unity State.
Before fighting broke out almost three years ago, South Sudan produced close to 400,000 barrels per day. Gatkuoth said today the country is only pumping 133,000 barrels per day.
Gatkuoth says plans are under way to fully engage oil companies in a bid to improve production.
“We have agreed [with China] that the contracts [of the oil companies] must be extended so that they can now move quickly on exploration and production sharing agreement so that we can increase the production in Paloch area and also we will move quickly to Unity area and Tharjiath,” Gatkuoth said.
On August 18, Ma Giang, the Chinese Ambassador to South Sudan, released a press statement in Juba, appealing to the South Sudan warring parties to respect the ceasefire across the country so that oil companies can continue their work.
Ma Giang said his government is committed to helping South Sudan increase oil production and exports so long as the government guarantees the security of oil workers.
“If we are going to increase the oil production we need very close cooperation from the South Sudanese government,” Ma Qiang said.
“We need a peaceful and stable environment in South Sudan. This way the Chinese government can encourage all Chinese companies, enterprises, even the private sector, to join the peaceful reconstruction in South Sudan,” Ma Qiang said.
China is one of the biggest investor in the oil sector in South Sudan.
On August 15, President Salva Kiir told law makers in Juba that his government plans to increase oil production to try to offset the steep economic decline, which has sparked famine and widespread hardship. Kiir said the country is “experiencing severe economic difficulties,” adding that people deserve better living conditions.
Early in May this year, Petroleum Ministry officials vowed to increase the oil production to 200,000 from 130,000 barrels per day by the end of this year.
Gatkuoth said the government aims to supply crude oil to neighbouring Ethiopia among other countries. He said Ethiopia is a huge market, importing fuel that costing billions of dollars every year.