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 energy sector in Juba.
Ezekiel Gatkuoth, South Sudan’s petroleum minister, said the agreement will allow the two countries to work jointly in the country’s oil industry and gas to improve the economy.
The deal was signed with visiting Energy Minister of South Africa, Jeff Radabe.
“What we have signed is a cooperation deal between the 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 would 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.
Radabe said the agreement was to ensure that the peace process is anchored with economic development by exploiting the oil resources for the prosperity of the country.
He added that the planned oil refinery would have 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 mineral laboratory to South Sudan’s petroleum ministry as part of his government commitment to the deal.