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Abu Dhabi, UAEThursday 13 December 2018

Exclusive: Sudan looks to become an oil exporter by 2023

Khartoum wants to build a $6bn refinery and woo foreign oil companies following the lifting of the US embargo

Sudanese energy minister Azhari Abdalla said his country was offering training to South Sudanese energy professionals. Pawan Singh / The National 
Sudanese energy minister Azhari Abdalla said his country was offering training to South Sudanese energy professionals. Pawan Singh / The National 

Sudan wants to become a net crude exporter by 2023 as it invites foreign oil companies to invest upstream and plans a $6 billion Red Sea refinery, the country’s petroleum and minerals minister said on Tuesday.

"We’re targeting to reach the level of a 110,000 barrels per day within the next two to three years then … within the next five years, and this will go in parallel, we’ll be looking for our next target, which is to export again,” Azhari Abdalla told The National during Adipec in Abu Dhabi.

Sudan, which had peak production of 476,000 bpd in 2006-07, has since seen its output dwindle to 77,000 bpd following the secession of South Sudan in 2011, which took away three-fourth’s of the country’s producing assets. The country's energy sector also suffered under two decades of US sanctions against Khartoum on charges of terrorism that were lifted last year.

The African country, which currently consumes around 150,000 bpd, has plans to attain self-sufficiency in two to three years.

Sudan, which saw its southern province secede to form a separate country following a bloody civil war, signed an oil deal with South Sudan to co-operate to boost production.

Under the terms, South Sudanese oil industry professionals will receive training in Sudan, with other agreements in place to allow for exports via Khartoum.

"We will make our refineries open to the South Sudanese for training,” said Mr Abdalla.

“There are agreements on how [exports are] done and the fees to be paid and also for the export and transportation. There are fees that have been agreed between us. It’s been implemented for years, even before seceding,” he said declining to specify the amounts paid by the South Sudanese.

Sudan is currently inviting international oil companies to come and participate in concessions it is preparing to offer.

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He declined to place a value on the amount of foreign investment required upstream for the industry, which has seen the likes of US oil field services firm Baker Hughes already join forces with domestic firms on gas projects.

While talks are underway with other partners for upstream activity, Sudan is considering plans for a 200,000 bpd refinery on its Red Sea coast valued in the range of $5 to $6 bn. It is also engaging with foreign investors to participate in the project.

"For us, we would like to see it happen now. We’re going through the process of negotiating, agreeing,” said Mr Abdalla.

Potential investors include an American firm and a Russian company that had discussed technical details during a visit led by the energy minister six months ago as well as a Chinese investor, the minister said, declining to reveal their names.

"We are talking to them separately because this is a big investment and for us we’re not restricting the economic model,” he said.

"We’re not even restricting the feedstock for the refinery. They can bring whatever they want and it will be on the coast,” he added.

He declined to specify a timeline for the completion of the planned refinery.