Sudan, South Sudan Agree on Oil Cooperation Deal

Sudan, South Sudan Agree on Oil Cooperation Deal
Chinese and Sudanese employees of Great Wall Drilling Company’s rig #136 pulling up the last part of the production pipe string on Unity Field’s well #44, which had stopped producing oil. They suspected either a bad down-hole pump or a bad power line to the pump. Most of the Sudanese employees were northerners, some 70% according to the head man from GWDC, but my estimate is higher, as none of the black drilling crew was Dinka or Nuer, the dominant ethnic groups in the South. The “company man” in charge of the rig for Greater Nile Oil Production Company was an Australian from Darwin, Cameron Wilkins, (private email who informally estimated the field to be 50% depleted.

Sudan and South Sudan have come up with a draft deal to develop oil cooperation, including resuming production from key oil fields, according to S&P Global.

Under the agreement, production at the Unity and Toma South fields will be prioritized, with 15,000 barrels of oil per day (bbl/d) from Block 5A expected to come online very soon. Sudan will also help in providing technical support for Blocks 3 and 7 in its southern neighbor. 

Due to the geographical nature of the region, land-locked South Sudan relies on Sudan to export its crude in a pipeline via Khartoum to the Red Sea.

Sudan consumes large quantities of crude oil which is processed at the 120,000 bbl/d Khartoum refinery.

So far this year South Sudan’s crude production has averaged 150,000 bbl/d. However, the two countries’ economies have been crippled by the low oil price environment.

South Sudan, a member of OPEC+, committed to cut output to 100,000 bbl/d for May, June, and July, while for August onward, it agreed to produce 106,000 b/d from its reference level of 130,000 bbl/d.


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