Connect with us

Markets

Oranto Petroleum Invests $500m in South Sudan Oil Block

Published

on

fourteen oil workers
  • Oranto Petroleum Invests $500m in South Sudan Oil Block

Nigeria’s Oranto Petroleum Limited has said it has signed oil sharing agreement with South Sudan covering the country’s Block B3, earmarking up to $500 million to explore the oil in the region.

In the first three years, Oranto said it would do airborne geophysical surveys in the 25,150-sq km block and assess existing data held by the government and former operators, among other activities.

“Oranto Petroleum will invest $500 million to develop South Sudan’s Block B3, launching a comprehensive exploration campaign starting immediately,” the oil company said in a statement, according to Oriental News.

Since its independence, South Sudan has relied on oil for all income a situation that has significantly compounded the ongoing political and economic instability, due to the fall in crude oil prices.

South Sudan got the lion’s share of the oil when it split from Sudan in July 2011, but its only export route is through Sudan, giving Khartoum leverage and leading to ongoing pricing disputes.

According to South Sudanese officials, production in the past reached as high as 350,000 bpd, but fell after a dispute with Sudan over fees for pumping South Sudan’s crude through Sudan’s export pipeline, which led South Sudan to halt oil production in 2012.

Oil production in South Sudan has, however, been affected by the conflict that erupted in 2013 after a political disagreement between President Salva Kiir and his then deputy, Riek Machar.

Even after restarting production, it never recovered to those levels, but it dropped to 245,000 barrels per day after the outbreak of the civil conflict hindered production in the oil-rich areas of the north.

“We believe the petroleum resources of Block B3 are vast. To reach our target of more than double current oil production, we need committed new entrants like Oranto,” South Sudan’s Minister of Petroleum, Ezekiel Lol Gatkuoth told reporters in the capital, Juba.

“The government is working hard to reinvigorate the petroleum industry in South Sudan by creating an enabling environment for International oil and gas companies to invest and operate. It is up to the oil companies to come in, explore and produce,” he added.

The block is highly prospective, with productive parts of the Muglad Basin to the northwest and estimated reserves in place of more than 3 billion barrels of oil. The block is categorized as low risk, high reward.

Under the EPSA, Oranto will be the technical operator and 90 per cent shareholder of the block, with Nilepet holding a 10 per cent stake.

“It’s an honor to formalize our entry into South Sudan with this EPSA,” said Chief Arthur Eze, founder and chairman of Oranto Petroleum.

“Our company is at the vanguard of African firms exploring and developing African assets. This is the beginning of a long-term collaboration with Nilepet, the people of South Sudan and our partners to bring to light the immense potential of Block B3. Oranto is committed to an aggressive exploration work programme that will benefit all stakeholders,” he added.

The 120,000-square kilometre Block B was reportedly split by the government into the B1, B2 and B3 blocks in 2012. In Block B3, Oranto would work alongside the B1 and B2 partners, which include Total.

South Sudan is an established, world-class petroleum producing region, whose territory includes a large part of the Cretaceous rift basin system that has proved petroliferous in Chad, Niger and Sudan.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Continue Reading
Comments

Crude Oil

Libyan Oil Field and Gas Link to Italy Reopen After Protesters Withdraw

Published

on

Iran Oil

Following a brief interruption, operations at an oil field in western Libya and a natural gas link to Italy have resumed as protesters retreated from the facilities.

The demonstrators withdrew after receiving assurances from the government regarding their demands.

The Wafa oil field, which typically produces between 40,000 to 45,000 barrels per day, recommenced shipments after a temporary halt prompted by guards’ demands for improved compensation.

Similarly, the gas pipeline connection to Italy is once again operational, according to sources familiar with the situation who preferred anonymity due to the sensitivity of the matter.

Protests disrupting energy infrastructure and output are not uncommon in Libya.

In recent times, demonstrations have frequently disrupted operations, with the significant Sharara oil field experiencing prolonged suspension last month due to similar protests, invoking a force majeure clause in contracts.

The resumption of activities marks a relief for both the Libyan energy sector and Italy, which heavily relies on the natural gas link for its energy needs.

However, the incidents underscore the ongoing challenges faced by Libya in maintaining stability within its vital energy infrastructure amidst socio-political unrest.

Efforts to address the grievances of protesters and ensure sustained operations remain pivotal for the country’s economic well-being and regional energy dynamics.

Continue Reading

Crude Oil

Oil Prices Dip on Monday as Dollar Gains

Published

on

Crude Oil

Oil prices experienced a downturn, extending losses from the previous session as the U.S. dollar surged against global counterparts to impact market sentiment.

Brent crude oil, against which Nigerian oil is priced, slipped by 0.2% to $81.48 a barrel while U.S. West Texas Intermediate crude (WTI) declined by 0.3% to $76.27 a barrel.

The upward trajectory of the dollar renders oil more costly for holders of other currencies, contributing to the decline in oil prices.

This downward trend follows a week of losses, with Brent declining approximately 2% and WTI falling over 3%.

Market participants attribute these fluctuations to concerns about inflation potentially delaying anticipated cuts to high U.S. interest rates. Such expectations have been suppressing global fuel demand growth.

Analysts observe a retreat in the risk-on sentiment, coinciding with heightened expectations of prolonged interest rates.

Tina Teng, an independent analyst based in Auckland, notes that the recent market rally led by Nvidia has stalled, as elevated rate expectations bolster the U.S. dollar, thereby pressuring commodity prices, including oil.

Despite geopolitical tensions such as the Israel-Hamas conflict and attacks on ships in the Red Sea, which could have traditionally boosted oil prices, the impact remains modest.

Moreover, investors are monitoring developments surrounding Russian oil supply following recent U.S. sanctions on Moscow’s leading tanker group.

Amidst these uncertainties, Qatar’s decision to increase liquefied natural gas production further adds to global energy supplies.

Continue Reading

Crude Oil

Crude Oil Dips Slightly on Friday Amid Demand Concerns

Published

on

Crude oil gains

On Friday, global crude oil prices experienced a slight dip, primarily attributed to mounting concerns surrounding demand despite signs of a tightening market.

Brent crude prices edged lower, nearing $83 per barrel, following a recent uptick of 1.6% over two consecutive sessions.

Similarly, West Texas Intermediate (WTI) crude hovered around $78 per barrel. Despite the dip, market indicators suggest a relatively robust market, with US crude inventories expanding less than anticipated in the previous week.

The oil market finds itself amidst a complex dynamic, balancing optimistic signals such as reduced OPEC+ output and heightened tensions in the Middle East against persistent worries about Chinese demand, particularly as the nation grapples with economic challenges.

This delicate equilibrium has led oil futures to mirror the oscillations of broader stock markets, underscoring the interconnectedness of global economic factors.

Analysts, including Michael Tran from RBC Capital Markets LLC, highlight the recurring theme of robust oil demand juxtaposed with concerning Chinese macroeconomic data, contributing to market volatility.

Also, recent attacks on commercial shipping in the Red Sea by Houthi militants have added a risk premium to oil futures, reflecting geopolitical uncertainties beyond immediate demand-supply dynamics.

While US crude inventories saw a slight rise, they remain below seasonal averages, indicating some resilience in the market despite prevailing uncertainties.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending