South Sudan’s petroleum ministry on Friday signed an agreement with South Africa that will allow the Johannesburg-based state-owned oil company to invest in the energy sector in Juba.
Ezekiel Lul Gatkuoth, South Sudan’s petroleum minister, said the agreement which he signed with visiting South African counterpart Jeff Radabe, will allow the two countries to work jointly in the country’s oil industry and gas to improve the economy.
“What we have signed this morning is a cooperation deal between our two national oil companies and the funding will come from the Central Energy Fund of South Africa,” Gatkuoth told journalists in Juba.
He said the joint cooperation with South Africa will help Juba build its oil refinery that will allow the country to sell refined products to Ethiopia, Sudan, Kenya and Uganda.
The minister said the east African oil-rich nation will be the hub of oil in the region and also in the continent, adding that the new deal will see the two countries create alternative routes of transporting its crude oil.
“We will continue to use the pipeline going to Port Sudan but for the oil that will be discovered in the southern part of the country, we will have to find a means to transport the crude and that is why it is important to have a new partner,” Gatkuoth said.
Jeff Radabe, energy minister of South Africa said the agreement is to ensure that the peace process is anchored with economic development by exploiting the oil resources for the prosperity of the country.
Radabe said the planned oil refinery will have a capacity of producing up to 60,000 barrels of oil per day and that is why the investment is a huge undertaking.
The South African minister also announced a donation of a mineral laboratory to South Sudan’s petroleum ministry as part of his government commitment to the deal.