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Tuesday, April 25, 2017
The government of South Sudan, through the Ministry of Petroleum, is looking for companies interested in investing in Blocks B1 and B2. The Ministry is willing to enter into direct negotiations for the blocks following the breakdown of talks between Total, Tullow Oil, and Kufpec.
According to a statement from the Ministry, its officials had met with representatives of Total, Tullow, and Kufpec in Kampala, Uganda to develop an EPSA for the blocks. Unfortunately, the negotiations reached an impasse over the proposed exploration period and cost recovery limit.
“Following lengthy discussions with representatives of the company Total we have decided it is in the best interest of South Sudan to open opportunities to other potential investors,” said Ezekiel Lol Gatkuoth, Minister of Petroleum of South Sudan. “We had hoped for a favorable outcome but we believe these large and highly prospective blocks need a fast and ambitious development program to achieve their full potential. B1 and B2 are now open for direct negotiation.”
Blocks B1 and B2 were once part of the 120,000 sq km area known as Block B, which was divided into three licenses in 2012. The area is highly rich in hydrocarbon deposits but has experienced very little exploration. In March 2017, Pan African independent Oranto Petroleum Ltd. signed an exploration and production sharing agreement (EPSA) with the government for Block B3. The area covers 25,150 sq km and has estimated reserves in place of more than 3 billion barrels.
“The resource base in these blocks are enormous and we need committed operators who are ready to invest and work with our government to comply with the laws of our country,” said Gatkuoth. “South Sudan is creating an enabling environment for companies to operate. We want companies to invest, explore, produce and we are ready to offer incentives to investors.”
The Ministry of Petroleum invites companies to negotiate directly on Blocks B1 and B2. Government officials will be present at the Africa Oil & Power conference in Cape Town on June 5, 2017 to advance discussions with interested parties.
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