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South Sudan offers crude oil despite export woes

South Sudan has issued two tender to export oil thought its shipment might be blocked by Sudan. At least five tankers were expected to load at the Bashayer terminal next week but brokers anticipated delay

Reuters , Thursday 12 Jan 2012
South Sudan
A view of the Heglig oil processing facility in South Sudan. (Photo:Reuters)
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South Sudan is offering more than 6 million barrels of crude oil on the spot market even though it cannot guarantee vessels will be able to load the cargoes at the Sudanese port, traders and shipbrokers said on Thursday.

South Sudan has issued a tender to sell 4.7 million barrels of Dar Blend and 1.6 million barrels of Nile Blend crude for loading in February despite concerns its shipments were being blocked by Sudan at the Bashayer oil export terminal.

Six months after landlocked South Sudan seceded from Sudan, the two countries have failed to agree on how much Juba should pay Khartoum in fees to transport its production of 350,000 barrels per day to port.

South Sudan has accused the Sudanese government of halting 3.4 million barrels of its crude oil exports, building a pipeline to re-route its oil, and diverting over half a million barrels to Sudan's refineries.

South Sudan's minister of petroleum and mining, Stephen Dhieu Dau, charged Khartoum with preventing two ships carrying 1.6 million barrels of South Sudanese oil from leaving Port Sudan, another from loading 600,000 barrels and two others from entering port to take possession of a further 1.2 million barrels.

At least five 80,000-tonne tankers, chartered by oil traders Arcadia, Trafigura and Vitol, were expected to load at the Bashayer terminal next week but brokers anticipated delays. The firms could face demurrage costs of around $9,000 a day to manage the anchored vessels.

"The buyers with vessels stuck there will not buy more crude from South Sudan," a crude oil trader said, referring to the tenders that will close on January 13.

Sudanese President Omar Hassan al-Bashir said this month Khartoum would impose a fee on Juba until a deal was reached on a transit fee but gave no details.

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