South Sudan accuses Khartoum of ‘diverting oil’

South Sudan on Tuesday accused Sudan of confiscating its oil entitlements for last December and setting up secret pipelines to tap the oil from the fields inside her territory.

The Petroleum and Mining minister Stephen Dhieu said Khartoum “ordered the foreign oil companies to divert all of South Sudan’s Nile Blend crude oil entitlements for December to Khartoum and El-Obeid refineries,” without a consent from Juba.

Dhieu said the authorities in Khartoum ordered “550,000 barrels of South Sudan’s Dar Blend crude oil entitlement for December to be delivered to a Sudan buyer.”

He said Khartoum has also “started the construction of a new tie-in pipeline between the Petrodar pipeline and the Khartoum refinery designed to permanently divert 13 per cent of Dar Blend” extracted from South Sudan’s Unity state.

In the same statement, Dhieu said that Khartoum has “prevented two ships from leaving the port carrying 1.6 million barrels of Dar blend originating from South Sudan and preventing one additional vessel to load 0.6 million barrels of South Sudan Dar Blend.”

The development is a fresh twist that could undermine the already strained relations between the two countries.

Two other ships, according to Dhieu, were prevented last Tuesday from entering the Port of Sudan to take possession of 1.2 million barrels of Nile Blend purchased from South Sudan to the buyers.

Pipeline operators

South Sudan relies heavily on oil, constituting 98 per cent of its budget, and any interruption on the production and sale of oil would hurt the infant country’s fledgling economy.

Two weeks ago, Dhieu said, South Sudan offered to provide $2.6 billion to give cash assistance and also forgive $2.8 billion of debts and arrears Khartoum owes to the people of South Sudan in return for friendship and cooperation.

Khartoum declined the offer, he said.

Previously, Khartoum insisted that it was confiscating her southern neighbour’s oil consignment to compensate herself for four earlier shipments that were unpaid for, an accusation South Sudan denied.

“While South Sudan is already paying the pipeline operators significant fees to produce and transport its oil through Sudan, Kharotum is spreading lies that the government of South Sudan is not paying for the use of the infrastructure in the North,” Dhieu said.

In July, South Sudan seceded from Sudan with more than 75 per cent of the oil that Sudan exported, but the pipeline and refineries are in the North.

Both sides have failed to agree on the oil transit fees for South Sudan to transport its oil through the pipeline that runs through the North to Port Sudan along the Red Seas coast.

South Sudan currently is being charged a transportation fees of $5 per barrel since Independence on July last year.

Sudan wants South Sudan to pay around $32 per barrel. Dhieu said legal actions will be taken against Khartoum and its potential buyers of what he called the "stolen commodity."