South Sudan to link to Kenya's pipeline

Jul 07, 2011 12:00 AM

South Sudan plans to build a link to a pipeline in Kenya to export its oil after breaking away from the north, a minister said.
The south will control 75 % of the African country's 500,000 bpd production when it becomes independent. So far, the underdeveloped south will have to rely on northern facilities such as its refineries and the only port to sell the oil, the lifeblood of north and south.

The announcement will cause concern in Khartoum which was counting on the south at least paying it fees to transport southern oil through northern pipelines -- to cushion the blow of losing the southern oil revenues. Anthony Makana, minister of roads and transport, said the south was in talks with several oil firms to build a 200 km long link to the existing South-Eldoret-Mombasa pipeline in Kenya.
"To build a pipeline is a very easy thing for us," he told in the southern capital Juba, putting the cost at a "few million dollars".

He said such a pipeline would help the south to export its oil to African neighbours such as Kenya, Uganda, Congo, Rwanda, Burundi, Tanzania and Ethiopia. Makana also said some oil fields contained more gas than oil, making it "economically viable to extract gas and then oil from some fields".
The World Bank said it was still unclear how much oil the south will be getting after the split but challenged the two states to ensure there is stability between them. But the bank said South Sudan should be assisted on how to use money from oil since majority of the cash was earlier controlled by the North.

"The country will have money... it's a question of helping them on how to spend wisely," said Ian Bannon, World Bank Acting Country Director for Sudan.
The World Bank also approved some Sh 6.7 bn ($ 75 mm) for projects in health, infrastructure and youth employment in Southern Sudan. Bannon also said all debts owed (to the bank) by the Sudanese government would be wiped out.

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