South Sudan’s Crude Oil Output Jumps as Unity State Fields Reopen

OILMONSTER.COM- South Sudan has increased its oil production by 34% after operations at its Unity state oil fields resumed, Petroleum Minister Ezekiel Lol Gatkuoth said Tuesday.

Production has increased to 175,000 b/d from 130,000 b/d in the past week, after the country resumed drilling in the region for the first time since the oil fields were hit by the eruption of civil war in 2013.

Oil was central to South Sudan's potential when it got its independence from Sudan in 2011. The country's oil production was at 350,000 b/d before the civil war broke out.

At their peak, the Unity fields, located on the border with Sudan, used to produce 45,000 b/d of Nile Blend crude, a light, sweet but waxy crude oil that is popular among Asian refiners.

The oil fields are operated by Malaysia's Petronas, India's Oil & Natural Gas Corp., and China's CNPC Capital Co.

The oil sector's revival is a key part of the peace deal mediated by Sudan, whose economy has also suffered from the slowdown in oil output to the south.

In September last year, the country signed a new peace deal to end five years of the civil war that had killed many people and crippled the oil industry, previously responsibly for about 98% of its budget. This has helped investors to resume works at the oil fields.

South Sudan, the world's newest nation after its 2011 spit from Sudan, has a proven reserve of 3.5 billion barrels of oil, the fifth-largest reserve in Africa.

So far, Asian investors -- Chinese, Malaysian and Indian firms -- dominate the country's oil industry.

But giant Russian oil companies such as Zarubezhneft, Gazprom Neft and Rosneft have also expressed interest in investing.

Last year, Nigeria's Oranto acquired an operating license to explore for oil in Block B3, where it has committed $500 million to develop a 24,415 square km area.

In November, South Sudan and South Africa signed a memorandum of understanding to explore oil and construct a refinery, with capacity to process 60,000 b/d at Palouch, in the northeast of the country.

Courtesy: www.spglobal.com