For many years now, Sudan has failed to capitalize on its considerable oil reserves due to the non-stop state of war the country has been experiencing either in the form of civil war or because of being at war with neighboring countries. As a matter of fact, Sudan has emerged as one of the oil-rich countries with great potentials of late, boasting proven oil reserves of 6.4 billion barrels, which are 32 times more than was estimated in 1981. Both reserves and production cover 0.5% of the world’s reserves and production
Considered Africa’s largest country and the tenth largest country in the world, the main hydrocarbon reserves are located in the war-torn Southern Sudan. However, Sudan remains largely unexplored as intensive and comprehensive seismic data have been collected from a few areas only. Observers attribute this to the fact that the government has failed to explore a considerable number of oil fields, and the operating companies have concentrated on the most immediately promising areas, leaving other areas unexplored.
Nevertheless, over 300 wells have been drilled in Sudan since the early 1960s. Around 200 of these have encountered hydrocarbons, giving an average technical and commercial success rate of around 60%, according to international organizations’ estimations.
In an attempt to put an end to the decades-long civil war, a Comprehensive Peace Agreement (CPA) in Sudan was signed to temporarily end Africa’s longest civil war. This was hailed as a tremendous achievement, but peace in Sudan is still fragile and does not cover the entire country.
Politically, the country remains divided and violence is still prevalent, becoming part and parcel of daily life in many Sudanese regions, especially in Darfur and Kordofan. Deadly incidents continue to occur regularly in the South. Though peace agreements have been signed between the government and rebel fighters, clashes erupt every now and then in different regions of the country. The recent deadly clashes between northern government forces and former southern rebels in the oil-rich region of Abyei has strained the 2005 peace agreement that ended Sudan’s two-decade old bloody north-south civil war. Despite the 2005 Comprehensive Peace Agreement (CPA), protocols on Abyei with its half-a-billion-dollar oil wealth have not been implemented. Leaders from north and south Sudan are currently holding talks on how to find a solution to the volatile situation in the Abyei region as fears of a return to civil war abound.
Oil, in fact, has always been a main factor in Sudanese politics. It is the government’s main source of income and it is driving economic growth, which hit unprecedented 10% last year. Meanwhile, the oil industry is poorly managed and highly politicized. So, instead of contributing to an atmosphere of peace and sustainable development, oil remains a source of strife and division.
In fact, the discovery of oil in the mid-1970s added a powerful economic dimension to the divide between the north and the south. The Darfur conflict began in 2003, when ethnic African rebels took up arms against the Arab-dominated central government, accusing it of discrimination. They were also fighting for resources and power in one of the most deprived places on earth. Khartoum was condemned by the international community as it was accused of retaliating by unleashing Janjaweed militias, blamed for the worst atrocities against civilians. Up to 300,000 people may have died from the combined effects of war, famine and disease, according to UN humanitarian officials.
There is no shadow of doubt that Sudan is one of Africa’s oil producing potentials, but with peace and stability increasingly becoming a far-fetched dream, oil investment flows have been rather cautious and not to full capacity.
By Mohamed El-Sayed
