Tullow CEO Sees Stunted Kenya Oil Project as Fix for South Sudan

Via Bloomberg, an article on a possible option to help transport South Sudan oil:

  • Oil company made Kenya discoveries more than a decade ago

  • South Sudan’s exports have been held up by a broken pipeline

Tullow Oil Plc’s delayed project to export oil from discoveries in Kenya by pipeline to the coast could be a solution for South Sudan to transport its own crude, according to the company’s chief executive officer.

The London-based explorer discovered crude in Kenya in 2012, but it’s failed to find a strategic partner to help realize the project and the country’s government has been slow to approve a development plan. At the same time, neighboring South Sudan is relying on an export pipeline that has become clogged, in addition to the risk from a conflict in its northern neighbor.

Connecting South Sudan’s oil output to the export pipeline planned by Tullow would help the viability of the Kenya project, Tullow Chief Executive Officer Rahul Dhir said in an interview in Cape Town.

“If you took 120,000 barrels a day from Lokichar and 250,000 barrels a day from South Sudan, you’ve got more than enough to build a very nice pipeline,” Dhir said.

No Way Out

Oil is stuck in landlocked South Sudan with no access to global markets after a northern pipeline via Sudan to the Red Sea became clogged.

Source: US Department of Energy Global Oil & Gas Features Database

The pipeline that ceased operating in February accounts for more than 90% of government revenue in South Sudan and has taken a toll on the wider economy. The military-led government of Sudan, through which the line runs, said it was ready to restart last month.

Still, the prospect of connecting an alternative route to Tullow’s project “is being talked about,” Dhir said, adding that it would complement the Lapsset Corridor that’s planned by Kenya to promote regional integration. “There could be a really interesting solution for South Sudan,” he said.



This entry was posted on Friday, November 8th, 2024 at 9:02 pm and is filed under Kenya, South Sudan.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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