By Charles Lotara, SSMJ Khartoum, (Monday 04 November, 2024) – A senior engineer familiar with the operation of the pipeline connecting South Sudan to Sudan through the Unity Oilfield has hinted a security guarantee of the facility once production resumes. This comes after the Juba and the warring Sudanese parties reached an agreement to restart oil production and secure the pipeline which was damaged in February this year, leading to the declaration of force majeure. Realizing the critica
By Charles Lotara, SSMJ
Khartoum, (Monday 04 November, 2024) – A senior engineer familiar with the operation of the pipeline connecting South Sudan to Sudan through the Unity Oilfield has hinted a security guarantee of the facility once production resumes.
This comes after the Juba and the warring Sudanese parties reached an agreement to restart oil production and secure the pipeline which was damaged in February this year, leading to the declaration of force majeure.
Realizing the criticality of the oil infrastructure to the economy of both countries, Mohamed Saleh Osman, Director of the Sudanese Pipelines Company who also doubles as the Chairman of the Crude Oil Pipeline Processing Committee at Dar Petroleum Operating Company (DPOC), revealed that Juba and the Rapid Support Forces (RSF) struck a deal to ensure the safety of two stations.
“The area that is controlled by the RSF and point affected starts from Station 3 to Station 4, which is about 237 kilometres and we do not have direct communication with the rebel forces,” Osman told Radio Tamazuj on Friday.
“According to the RSF’s agreement with our brothers and sisters in South Sudan, they will not touch the pipeline and will not touch civilians and this will give a space for transportation of fuel and spare parts,” Mr Osman added.
The pipeline engineer further revealed that they have just concluded a joint workshop with South Sudan to discuss and agree on the modalities for the resumption of the South Sudan crude oil through Sudan.
“We held a three-day workshop at DPOC offices and agreed on a joint plan for resumption of the crude oil of South Sudan,” he said.
When asked about the timeline for the resumption of the crude oil, Osman said the crude oil is expected to arrive in Port Sudan in a bout one and a half month.
“We have put in place a clear timeline on when the pumping will begin, when the wells start working, and when the pumping from Paloch to Jebelain will start and from Jebelain to the other pipelines will start,” he stated.
While the company does not have direct contact with the paramilitary group, Osman told the local radio station that everything was under the control of the regime in Juba.
“We expect the pumping stage of the crude oil to start after 45 days. We have no right from our side to coordinate the protection of the pipeline with the RSF, but the authorities in South Sudan coordinated the issue from their side to ensure a smooth flow of the oil,” he said.
He called for patience as the two countries work to restore production after nearly nine months of suspension due to insecurity.
“My message is that people should be patient and all will be fine. I can say work on the pipeline is progressing well and it will work soon but we need some support from partners and South Sudan,” Osman stated.
South Sudan relies on oil for over 80% of its revenue. The disruption in oil production exacerbated what was already a dire state of economy, weakening the local currency against the United States Dollars, and setting a center stage for high market prices.
Osman acknowledged that “Stoppage of oil production has affected the two countries, so resumption of oil has a mutual benefit economically.”
It is unclear how the new arrangements will be incorporated into the Transitional Financial Arrangement (TFA), a $3.028 billion agreement signed between Sudan and South Sudan shortly after South Sudan's independence in 2011.
The agreement was part of a package of measures to help ease the economic impact of South Sudan's secession from Sudan. It required South Sudan to make substantial financial contributions to Sudan over a period of 42 months.
Under the agreement, Juba pays Khartoum fees and tariffs to ship its crude oil to international markets through a pipeline to the Red Sea.
The pact helped to protect Sudan's economy from the loss of oil revenues that resulted from South Sudan's secession. However, the cessation of oil sales due to the Khartoum War resulted in substantial financial deficits for both countries.