Kenya urged to mediate Sudan oil row

Kenya has been urged to intervene and help resolve a row over oil pipeline pitting the two Sudans.

A petroleum geologist based in Boston, Massachusetts, Mr Samuel Karanja said the intervention is for the good of Kenya's strategic interests.

“Kenya should now provide a technical and diplomatic support between Sudan and South Sudan in the dispute associated with the use of the present export infrastructure to move oil from south Sudan to the international markets,” Mr Karanja said.

The geologist said Kenya has the “strategic and moral authority to get South Sudan on the negotiating table while it can encourage Sudan to open its pipeline and port infrastructure to South Sudan to recover its cost on the built up infrastructure.”

“At the same time, with this involvement, Kenya will access vital strategic information on the oil fields in South Sudan that will be useful when the South eventually builds the pipeline through Kenya and when it becomes the main supplier of oil to East Africa as is likely to be the case in the future,” the geologist said.

Mr Karanja said it will be useful if Kenya could acquire the geologic and play types of the producing fields in the South Sudan as this could in turn prove invaluable to the Kenya’s geologists in the exploration of petroleum in Turkana and Anza basins, which have similar geologic basin architecture and sedimentary play types.

“These data has hitherto been kept confidential by the international oil companies operating in South Sudan,” Mr Karanja said.

Kenya has strategic interests with the two countries and South Sudan will increasingly rely on Kenya as it develops its infrastructure and trade with the outside world.

Kenya played a critical role in the peace accord between the South Sudan and the North.

On Friday, South Sudan shut down its oil pipeline that runs through the Sudan to the export terminal along the Red Sea coast worsening tensions between the two countries.

The closure followed South Sudan’s persistent oil row with Sudan.

The Council of Ministers in a sitting chaired by President Salva Kiir directed the Petroleum and Mining minister Stephen Dhieu Dau to execute the decision immediately, Information minister Barnaba Marial Benjamin said.

The decision comes in the wake of deteriorating relations with Sudan, with South Sudan accusing her northern neighbour of stealing its oil destined to potential buyers overseas and constructing a secret pipeline to divert her oil.

Over 75 per cent of the crude oil Sudan exported before its split in July last year came from fields in the south, but most of the infrastructure has been in the north.

South Sudan became Africa’s newest nation in July under a 2005 peace deal that ended decades of civil war between north and south, but many issues remain unresolved, including oil, debt and violence on both sides of the poorly-defined border.

Even after independence, the two Sudans are yet to agree on a transit fee for the latter to use the pipeline that runs to the export terminal at Port Sudan along the Red Sea coast.

Tensions escalated last week when Khartoum said it had started confiscating oil from landlocked South Sudan, which exports its crude through Sudan’s pipelines to a port on the Red Sea.

Sudan’s economy has been badly hit by the loss of two-thirds of oil production to the South, and the country is under pressure to ease the hardships of people already exhausted by years of conflict, inflation and a U.S. trade embargo.

Despite South Sudan’s oil wealth with production of 470,000 barrels per day, it lacks the infrastructure to refine and export oil.

Crucial facilities including a pipeline and Red Sea export terminal remain in Sudan, leaving the two states arguing over how much the south should pay to use the infrastructure.

Sudanese authorities recently stopped two ships loaded with 650,000 barrels of South Sudanese oil from leaving the export terminal because they did not pay the port fees, according to Khartoum's foreign ministry.

Oil firms active in South Sudan include Chinese state-owned China National Oil Corp., or CNPC, and Sinopec, Malaysia's state-owned Petronas, and Oil and Natural Gas Corp of India, or ONGC.