- Title: SOUTH SUDAN: Launches construction project on first oil refinery
- Date: 22nd November 2012
- Summary: PALOUGE, SOUTH SUDAN (NOVEMBER 20, 2012) (REUTERS) VARIOUS OF PROCESSING FACILITIES STAFF FROM DAR PETROLEUM WAITING FOR SOUTH SUDAN PRESIDENT SALVA KIIR KIIR GREETS HEAD OF DAR PETROLEUM STAFF LOOKING ON
- Embargoed: 7th December 2012 12:00
- Location: South Sudan
- Country: South Sudan
- Topics: Business,Energy
- Reuters ID: LVA69FSOW2IUROPE5L8U5OR7SCNC
- Story Text: South Sudan's President Salva Kiir inaugurated the start of construction of an oil refinery on Tuesday (November 20), the young African nation's first.
The multi-million dollar refinery project, which will be completed next year, will ease South Sudan's reliance on imported petroleum products like diesel, and also provide fuel for a planned 180 MW power plant.
Landlocked South Sudan shut down its oil industry in January over a dispute with Khartoum over how much it should pay to use pipelines running through Sudan.
The shutdown led to a dollar crunch and severe fuel shortages throughout the country.
"Instead of our petrol being taken to help the home of another person, it's better that it helps our people in our homeland. This is the first thing that brought me here," said Kiir.
South Sudan signed an agreement with Sudan in late September that allowed the oil companies to prepare for the restart of production.
Oil companies and government officials expected oil to resume this month, but Kiir accused Khartoum of stalling the switch-on.
After the last round of talks, Khartoum asked the African Union for six more weeks to discuss security issues with Juba, including the disputed Abyei region.
"We were supposed to resume oil exports through Sudan to Port Sudan on November 15, five days ago. Suddenly Khartoum has changed its mind," said Kiir.
Khartoum says oil can only resume flowing once their shared border is fully demilitarised. The rival Sudans came close to all-out war over oil and their ill-defined border in April, but agreed to pull their armies back from the border after the UN threatened sanctions.
Oil is the lifeblood of both economies, making up 98 percent of state revenues in the South.
The economic squeeze on both economies has led to severe austerity measures.
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