South Sudan, China Mull Alternative Oil Pipeline to Boost Exports
TLDR
- South Sudan and CNPC consider new crude oil pipeline to reduce dependency on current infrastructure.
- Proposed pipeline route through Djibouti and Ethiopia aims to enhance export potential from oil Blocks 3 and 7.
- Discussions also addressed oil sector reforms, refinery establishment, and distribution network creation.
South Sudan and China National Petroleum Corp. (CNPC) are considering constructing a new crude oil pipeline to reduce dependency on the existing infrastructure, which has limited export capabilities.
President Salva Kiir and CNPC Chairman Dai Houliang discussed a proposed pipeline route through Djibouti and Ethiopia to enhance export potential from oil Blocks 3 and 7, according to a statement from the South Sudanese presidency.
The talks also covered oil sector reforms, the establishment of a refinery, and the creation of distribution networks. CNPC, which holds a 41% stake in Dar Petroleum Operating Co—the largest oil operator in South Sudan—pledged to ensure smooth operations and continue exploring new oil reserves.
Key Takeaways
South Sudan’s oil production has been severely affected since one of the two existing export pipelines in Sudan, currently embroiled in conflict, was damaged. Before the disruption, the country produced 150,000 barrels per day. Recent data shows exports of Dar Blend and Nile Blend crudes were at 77,000 barrels per day in August, up from July’s multi-year low of 52,000 barrels.
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