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South Sudan Oil Output Drops

Crude oil production in South Sudan has declined to 165,000 bpd from 185,000 bpd due to the pandemic, floods in some parts of the country, and geological challenges, the Sudan Post reported, citing a senior government official.

“Our production has dropped to 115,000-118,000 bpd in Dar and then in three GPOC blocks it is around 50,000 BPD, which adds up to 165,000 bpd all over the country,” petroleum ministry undersecretary Awou Daniel Chuang said.

The official added that “If we expect any increase, it will not be more than 5-10% maximum. It is not easy for us to go back to the previous 300,000 bpd because of the geological challenges. We understand there is a natural decline and oil reserve is limited.”

South Sudan, which seceded from Sudan less than ten years ago, is not a major producer of crude oil, with an average production below 200,000 bpd, but it has plans to develop the industry, which is its only big source of export revenues. It is home to most of the former larger Sudan’s oil reserves.

Last year, South Sudan announced its first oil find after the secession, at 5.3 million barrels of recoverable crude. At the time, its oil production averaged 180,000 bpd, down from 350,000 bpd before the separation from Sudan, but the country planned to increase it substantially.

Related: How Will Exxon’s Big Bet On Oil Play Out?

Now, these plans are in the trash bin, not just because of the pandemic, but also because South Sudan is a member of OPEC and obliged to comply with the cartel-wide production cuts aimed at reducing the supply excess that contributed to the oil price crash from earlier this year.

Despite the many challenges, the country is still pursuing its production boost plans.

“We have around 14 blocks other than the areas that we are producing. We are working every day to collect data and then do the mapping, which will help us to open the licensing rounds. The licensing round is to invite new bidders, new players in South Sudan so that we can explore oil in other areas. There is a very big potential to discover more oil in other areas across South Sudan,” Chuang also said this week.

By Charles Kennedy for Oilprice.com

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