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S.Sudan Expects 1st Oil Exports in 90 Days after Restart

Source: Reuters 10/18/2012, Location: Africa

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South Sudan expects its oil exports to come back to the market in three months after the government ordered oil companies to resume production, its oil minister said. Last month, it reached a deal with Sudan to resume exports through northern pipelines after shutting down its output of 350,000 barrels a day in January in a row over fees.

"The foreign oil companies ... are hereby ordered and instructed forthwith to recommence and re-establish the production of crude oil and all petroleum operations within the producing blocks 1,2,4,3,7 and 5a," Stephen Dhieu Dau told reporters.

The biggest foreign operator, Dar Petroleum, which is run by Chinese state firms Sinopec, China National Petroleum Corp and Malaysia's Petronas, said last month it expects an initial output of 180,000 bpd within three months. Dar, formerly known as Petrodar, runs oil blocks 3 and 7 in Upper Nile state which used to pump between 230,000 bpd and 250,000 bpd until the shutdown. Its sister firm also operates an export pipeline through Sudan.

The two export pipelines through Sudan were filled with water to avoid gelling and some fields in western Unity state were damaged during weeks of fighting in April between the rivals. A processing plant for the Unity fields located on the Sudan side of the disputed border also got hit. Last month, an official said South Sudan will only pump oil at about 70 percent of its former capacity as it would take up to six months for oil to flow into the pipeline from Upper Nile state and nine to 12 months in the pipeline from Unity state.

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