Via Bloomberg, a report on Juba’s exploration of alternative routes to export its oil, given ongoing conflict in Sudan:
South Sudan is in talks with Kenya and Ethiopia to truck oil to the coast for export, which would mitigate the risk of depending on pipelines running through war-plagued Sudan.
The East African nation relies on oil shipments to fund state coffers. South Sudan President Salva Kiir discussed the transport alternative with his Kenyan counterpart during an Aug. 19 meeting, Deputy Finance Minister Agok Makur said in an interview.
“The talks have been very positive with Kenya and a memorandum of understanding has been reached,” he said. “Even with Ethiopia we have already discussed the issue of roads and export of oil so that we can have alternative routes when conflict affects things.”
Oil running through Kenya could leave from the port in Mombasa, while Ethiopia would transport the oil onwards to a Red Sea port in neighboring Djibouti.
South Sudan, which produces around 150,000 barrels of crude a day and has welcomed the likes of China National Petroleum Corp. and Malaysia’s Petroliam Nasional Bhd., has recently seen exports spike despite a conflict erupting in April between the Sudanese army and the paramilitary Rapid Support Forces. The fighting has displaced some 4 million people and deepening a food crisis throughout the North African nation.
Shipments loading at Port Sudan were at their highest in almost two years in May, at 154,839 barrels a day, compared with 77,419 in March, according to vessel data compiled by Bloomberg. Transporting even the lower output by road would require hundreds of trucks to make the a trip from South Sudan’s fields to the coast every day.
Makur said he is “very optimistic” the road transport option will work out.
Two pipelines leave South Sudan before joining in Khartoum at a major refinery. The RSF holds the country’s largest oil refinery outside the capital Khartoum, which is responsible for the vast majority of Sudan’s petroleum refining and efforts have been taken by both sides to limit the damage to the pipelines, according to Jonas Horner, an independent analyst.