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S.Sudan Eyes Oil Production of 300,000 bpd by Mid2013

Source: Reuters 9/12/2012, Location: Africa

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South Sudan could produce at least 300,000 barrels per day of oil when it resumes full production, but that may take until mid-2013 because of damage caused during its border dispute with Sudan, an oil official said.

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The landlocked African nation, which seceded from Sudan over a year ago, Oil Re-refining shut down its oil output in January during High Recovery of Used Motor Oils via its dispute with Khartoum over how much Short Path Evaporation www.pfaudler.com it should pay to export crude through pipelines in Sudanese territory to a Red Sea port. Fighting along the 1,800-km (1,200-mile) border threatened to boil over into a full-scale war in April when South Sudan seized an oil-producing region long held by Sudan. South Sudanese officials had said the country was producing about 350,000 bpd before the shutdown, equal to about three-quarters of the formerly united country's total. The South reached an interim deal on transit fees with Sudan last month that could open the way to resuming oil exports, but Khartoum still wants a deal to secure the disputed and volatile shared border before crude flows resume. Ministry of Petroleum and Mining Undersecretary Macar Aciek Ader said resuming output in Upper Nile state, home to South Sudan's most productive oilfields, was possible by the end of the year, but turning on wells in the Unity state would probably take longer. "For northern Upper Nile, it may not take long because according to the information we got from the field, not much damage has been done. Hopefully it will be by the end of the year," he told Reuters in the capital Juba. "As for the western oil production, that is, in Unity state, there was too much damage in Heglig area, so that... may take time, up to the middle of next year." He said exact production levels would depend on technical factors, but added: "One could still talk in terms of a minimum of about 300,000 barrels per day. Minimum." South Sudan's western oil fields needs to go through a processing plant at the disputed Heglig oilfield, which contribute to much of Sudan's output. Part of the facilities were damaged when South Sudan's army briefly seized Heglig during weeks of border fighting. The dispute has hit both economies hard, fuelling high inflation and a foreign currency shortfall on both sides of the border. South Sudan depended on oil for about 98 percent of state revenues before the shutdown and has struggled to make up for the loss through loans and boosting tax revenues. The two sides are currently in border security talks in the Ethiopian capital Addis Ababa, facing a

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U.N. Security Council deadline of September 22 to reach a deal or risk sanctions. Much of South Sudan's oil exports used to go to China until the shutdown. China built large parts of the oil infrastructure.

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