South Sudan strikes new deal with Sudan on oil transit charges
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February 3, 2016 (JUBA) - South Sudanese government on Wednesday
announced that it has reached an understanding with the government of
neighbouring Sudan from which it seceded in 2011 to reduce charges for
transporting crude oil to the international markets through Sudanese
territory.
JPEG - 45.3 kb
South Sudan’s Petroleum and Mining Minister Stephen Dhieu Dau (3rd R)
applauds as he restarts oil production in the main oil field in
Palouge, on May 5, 2013. (Reuters)
South Sudanese minister of petroleum and mining, Stephen Dhieu Dau,
told reporters after concluding a closed door meeting with his
Sudanese counterpart had reached an agreement to review the charges
considering the sharp fall in oil prices.
“Our meeting has finished. We have discussed and agreed in principle
to review the agreement, especially the section related to the oil and
now we have resolved to negotiate. And when we negotiate on the
transitional financial arrangement in particular, it will not be a
fixed $15 per barrel as it was agreed in 2012. It will be fluctuating
up and down depending on the prices of the crude globally,” minister
Dau told reporters on Wednesday.
He said the two parties through their technical teams would work out
how much the new charges would be.
The young nation is obliged under the terms of the 2012 deal to pay
Sudan $9.10 per barrel for oil flowing using Petrodar facilities in
Upper Nile in addition to a fee of $15 per barrel in fulfillment of a
$3.028 billion package which the two sides agreed as transitional
financial arrangement (TFA). The TFA is meant to help Sudan cover the
gap resulting from the loss of revenues due to secession of South
Sudan from Sudan in 2011.
But now the two oil ministers representing South Sudan and Sudan
hinted a fixed $15 per barrel rate would be renegotiated and the
amount of $3 billion will not be affected by the new arrangement.
It will continue to be paid over a longer period of time. The
transitional financial arrangement (TFA) payment, according to South
Sudanese oil minister, “will be extended to more years.”
Dau’s remarks were quickly confirmed by the Sudanese minister of
petroleum, Mohammed Zayed Awad, saying they “have agreed in principle”
to reduce the monthly payments for transitional financial arrangement
and extend period for payment.
He declined to reveal the rate at which his country would be paid as
part of the new understanding between the two countries, saying it
will be determined by team which the two sides would form to come up
with reasonable rate based on market reactions.
“For this issue to be scientific, we gave it to the technical
people... Yes, we have agreed in principle but we need the technical
people to work on it and in a week to come we will reach to the
conclusion,” minister Zayed said.
“We don’t want to talk on figures because we are not ready as it
requires a lot of technical work and may be after when they conclude –
we will tell you,” he added.
The war torn young nation has been hit by economic crisis as prices of
its only export commodity, the oil, has dropped from $110 per a barrel
before the civil war in 2013 to just $24 per barrel.
After paying Sudanese their charges for transporting the oil through
their facilities as well as paying oil companies, the government of
South Sudan remains only with less than $5 dollars a barrel.
(ST)
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3 February 20:42, by Ayuiu Makuac Lam
I thanks Sudan, for reducing the charges from $25 to $15 per a barrel.
repondre message
3 February 20:54, by Force 1
The deal is just a daylight robbery against South Sudan! The
only way South Sudan is going to avoid this ripped off; South Sudan
need to reroute the oil transit route to somewhere else that’s not
through Sudan!
repondre message
3 February 21:16, by Ayuiu Makuac Lam
Force1
This is not a first times for South Sudanese to be looted by Sudan.
repondre message
3 February 23:02, by Lotodo Awino Odug
this is better than nothing.
repondre message
3 February 23:41, by Force 1
Ayuiu Makuac Lam;
I didn’t say this is the first time for South Sudan to be
looted; in-fact I was behind the first oil shutdown when South Sudan
shut it down against Sudan; if you were aware it! You would be the
last guy to tell me the history of oil transit fees between Sudan and
South Sudan!
repondre message
3 February 23:06, by lino
We shouldn’t be happy about! We will be paying Sudan till our oil
is depleted or we find other routes or build refineries!!!
repondre message
3 February 23:22, by Lotodo Awino Odug
We will have little to reap from the sell of oil, although I
believe this million will go to Dhieu Dau, Machar Achiek and Deng
Athoolbai.
repondre message
4 February 06:22, by Eastern
.....it’s again below the belt for South Sudan; poor deal. Shame
to kleptocrats!
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