Sudan fighting won't deter oil investors: Minister

AFP, Sunday 1 Apr 2012

Oil official says over 70 firms have shown interest in six new Sudanese exploration blocks which opened for bidding in January

Fighting last week in Sudan's key oil region is no deterrent to investment in the sector, the country's oil minister said on Sunday, while denying that infrastructure there had been damaged.

Awad Ahmad al-Jaz said more than 70 companies have expressed interest in six new Sudanese exploration blocks, which opened for bidding in January.

"We expect (them) on April 17 to come with their proposals," he told AFP on the sidelines of a seminar on investment prospects in Sudan.

The new blocks are in areas far from the oil-producing border zone in South Kordofan where deadly clashes erupted between Sudanese and South Sudanese troops last week.

A Sudanese oil engineer earlier said the area's normal daily output of 60,000 barrels -- about half Sudan's total -- had fallen to 40,000 because some wells were affected by the fighting. He did not give further details.

But Al-Jaz insisted there were no problems at the Heglig oil hub.

"No, we don't have any damage," he said. "The production now is coming to normal."

Addressing the seminar, which was part of the Jeddah-based Islamic Development Bank's annual meeting,

Al-Jaz referred to the tensions with South Sudan over oil.

But he said: "In the areas of oil investment there is not a single stumbling block or conflict."

Oil operations in Heglig are run by the Greater Nile Petroleum Operating Company (GNPOC), a consortium led by China's state oil giant CNPC.

Although both north and South Sudan claim parts of the Heglig area, an analyst said it "is firmly in north Sudan".

Sudan's army at the weekend alleged South Sudan and rebels were building up forces south of Heglig in preparation for another attack.

Heavily-indebted Sudan lost billions of dollars in oil receipts when South Sudan gained independence last July, taking with it about 75 percent of crude production.

The two sides have been unable to resolve a dispute over oil fees, which led the South in January to shut crude production after Khartoum began seizing Southern oil in lieu of compensation.

Land-locked South Sudan was using a northern pipeline and port to export its crude.

Southern oil represented more than one third of the Khartoum government's revenues, and its biggest source of hard currency, leaving the government struggling for alternatives.

Along with Al-Jaz, the ministers of finance, mines, tourism and others took to the podium in a promotional pitch.

President Omar al-Bashir made his own appeal last week when he addressed a summit of Arab leaders in the Iraqi capital Baghdad.

"We are looking forward to your investment in different sectors," Bashir said.

He asked for the Arab leaders' assistance in clearing his country's long-standing foreign debts, which amount to around $38 billion.

"We are also calling on you to help remove the sanctions from Sudan," he said.

The United States imposed a trade embargo on Sudan in 1997 over human rights and other concerns.

Short link: