Sudan open to foreign investment in oilfields

Sudan wants to become a net crude exporter by 2023 as it invites foreign oil companies to invest upstream and plans a $6 billion (Dh22.04bn) Red Sea refinery, the country’s petroleum minister said yesterday.

“We’re targeting to reach the level of a 110,000 barrels per day within the next two to three years then … within the next five years, and this will go in parallel, we’ll be looking for our next target, which is to export again,” said Azhari Abdalla during Adipec event in Abu Dhabi.

Sudan, which had peak production of 476,000 bpd in 2006-07, has since seen its output dwindle to 77,000 bpd following the secession of South Sudan in 2011, which took away threefourth’s of the country’s producing assets. The country’s energy sector also suffered under two decades of US sanctions against Khartoum on charges of terrorism that were lifted last year.

The African country, which consumes around 150,000 bpd, has plans to attain self sufficiency in two to three years. Sudan, which saw its southern province secede to form a separate country following a bloody civil war, signed an oil deal with South Sudan to co-operate to boost production.

Under the terms, South Sudanese oil industry professionals will receive training in Sudan, with other agreements in place to allow for exports via Khartoum. “We will make our refineries open to the South Sudanese for training,” said Mr Abdalla.

“There are agreements on how [exports are] done and the fees to be paid and also for the export and transportation. There are fees that have been agreed between us. It’s been implemented for years, even before seceding,” he said declining to specify the amounts paid by the South Sudanese.

Sudan is currently inviting international oil companies to participate in concessions it is preparing to offer.

He declined to place a value on the amount of foreign investment required upstream. Companies such as Baker Hughes have already joined forces in gas projects.

While talks are under way with other partners for upstream activity, Sudan is considering plans for a 200,000 bpd refinery on its Red Sea coast, valued in the range of $5bn to $6bn. It is also engaging with foreign investors to participate in the project.

Potential investors include an American and a Russian company that discussed technical details during a visit led by the energy minister six months ago as well as a Chinese investor, the minister said, declining to reveal their names.