LOOKING AHEAD: Contrasting fortunes of the two Sudans
| Published date | 01 June 2015 |
| Date | 01 June 2015 |
| DOI | http://doi.org/10.1111/oet.12258 |
LOOKING AHEAD
Contrasting fortunes of the two Sudans
While South Sudan’s oil production remains depressed
by more than a year of civil strife, its neighbor to the
north, Sudan, is announcing plans for an increase in
output of up to 150%. e two Sudans came into being
in July 2011 with the secession of South Sudan, which
took with it the majority of the former single country’s
oil production. e bre ak le South Sudan with about
350,000 bpd of production capacity, compared with just
over 80,000 bpd for Sudan.
Southern strife
Since December 2013, however, South Sudan has been
embroiled in a civil war between the ruling Sudan
People’s Liberation Movement (SPLM) under President
Salva Kiir, and rebel forces under Kiir’s bitter rival and
former Vice-President,Riek Machar who call themselves
the Sudanese People’sLib erationMovement– In Opposi-
tion (SPLM-IO). e rebels have concentrated their mil-
itary operations on South Sudan’s oilelds in an attempt
to deprive the SPLM of its main source ofrevenue. eir
activities have led to the loss of some 180,000 bpd of
production, leaving South Sudan with an output of on ly
170,000 bpd (see Ta bl e E ) .
Oil production has ceased in Unity state, leaving only
the elds of Upper Nile state in production. In late-May
2015, output was reported as low as 165,000bpd as
rebel forces closed-in on the area, demanding that Dar
Petroleum ceaseproduction there, although the govern-
ment claimed to be still in control of the area. Upper Nile
is South Sudan’s most important oil-producing region
with about 70% of the country’s total production capac-
ity (see Tab l e E ).
One eect of the ghting has been to damage pol-
lution control equipment , which has l ed to a numbe r
of oil-spills. Another consequence has been the suspen-
sion of work on two mini-re neries in Unity and Upper
Nile states. e government’s revenues have also been
badly hit as a result both of the shutting-in of produc-
tion and the recent fall in global crude prices. According
to the International Monetary Fund (IMF) oil revenues
account for 95% of government income.
e largest investorin S outhSudan, and the main pur-
chaser of its oil, is China, which is becoming increasingly
concerned at the spread of violence across the country,
and Beijing is putting pressure on both sides to end the
present conict. e Chinese government has also sent
an estimated 850 troops to defend its oil assets in South
Sudan. ere is as yet, though, no sign of a permanent
settlement of the dispute between the two sides.
Table E
Sudan: Crude Oil Production 2011-2013 (Selected Quarters)
Consortium Production
Q3 2011∗Q4 2013†Q1 2015
(bpd)
Dar Petroleum Operating Company
CNPC/Petronas/Nilepet/Sinopec/
Tri-Ocean
250,000 200,000 170,000
Greater Pioneer Operating Company
CNPC/Petronas/ONGC/Nilepet
85,000 40,000 –
Sudd Petroleum Operating Company
Petronas/ONGC/Nilepet
15,000 10,000 –
Total 350,000 250,000 170,000
∗First quarter following independence
†Pre-civil war output
Totals rounded
Source: Operating companies; oil press; MEES
ONGC, Oil and Natural Gas Corporation Ltd.
Better prospects in the north?
Following the brea k-up of Sudan, the northern half
found itself with a production of only 80,00 0 bpd.
Since then, however, output has risen steadily, reaching
120,000 bpd in 2014 and an estimated 130,000 bpd in the
rst quarter of 2015. It is planned for output to continue
rising to reach 140,000 bpd by the end of the year, and
there are further plans for a total of 320,000bpd by the
end of 2017.
Most of Sudan’s oil production comes f rom elds
in the south of the country, in areas close to South
Sudan. e main producing areas are South Kordo-
fanstate–whereaconsortiumledbyChinaNational
Petroleum Corporation (CNPC) is producing about
60,000 bpd– and East Darfur, where another CNPC-led
group produces about 65,000bpd. A new eld began
production in Western Darfur, at Suan, this year with
anoutputof5,000bpd,andanotherneweldisalsodue
to be commissioned nearby in 2015.
e government is keen to develop further parts of
the Darfur region, along with several other new areas,
including the areas close to Sudan’s borders with Egypt
and Libya, together with par ts of the Red Sea. In Dar-
fur, though, Sudan is facing an uprising of local inhabi-
tants opposed to the Muslim-dominated government in
Khartoum, which t he non-Muslims of Darfur say has
neglected t he economic development of thei r region. Oil
exploration in Darfur has been delayed as a result. e
United Nations and US have accused Khartoum of war
crimes in Darfur and the US bans its oil companies from
participating in oil developments in Sudan.
© 2015 John Wiley& Sons Ltd
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