South Sudan has just launched its inaugural oil licensing round, hoping to attract interest from a diverse group of foreign investors.
South Sudan broke from Sudan in 2011, taking with it around 350,000 bpd in oil production. But then civil war in South Sudan broke out in 2013 that further complicated oil production.
In 2018, the warring factions in South Sudan signed the so-called Khartoum Declaration of Agreement, in which the parties to the South Sudan conflict declared a permanent ceasefire, and the governments of Sudan and South Sudan explored ways to rehabilitate the oil sector in South Sudan.
Now South Sudan's Ministry of Petroleum has identified new exploration blocks with potential hydrocarbons and has compiled crucial data to provide to interested investors, operators, and counterparties, it said in a statement.
Around 90 percent of South Sudan's oil and gas reserves remain unexplored, according to an analysis commissioned by the Petroleum Ministry. These resources provide "unprecedented opportunities to international investors," South Sudan says.
"This Oil Licensing Round aims to attract interest from a diverse group of foreign investors to a region that is already home to oil and gas majors from China and Malaysia," the ministry noted.
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South Sudan also hopes to welcome back experienced partners and operators now that it has made significant progress in returning to peace and stability, it added.
Currently, South Sudan has four producing blocks, operated by China National Petroleum Corporation (CNPC) and Malaysia's Petronas.
The first licensing round is offering five blocks up for grabs.
Due to the pandemic last year, crude oil production in South Sudan declined to 165,000 bpd from 185,000 bpd. Floods in some parts of the country and geological challenges also led to reduced oil production.
South Sudan has been part of the non-OPEC group in the OPEC+ production cut agreement since its inception in 2017.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More
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