Sudan restarts oil production from Heglig

May 02, 2012 | Africa

Sudan_oil_region

Sudan on Wednesday said it had begun pumping oil again from its war-damaged main Heglig oil facility, 12 days after occupying South Sudanese troops left the area.

“This is an official announcement of re-pumping the oil from Heglig field,” Oil Minister Awad Ahmad al-Jaz told reporters.

He did not answer a question about how much has been pumped.

Sudanese repair crews have staunched the flow of crude from the damaged 28-inch (71 centimetre) pipeline, and oil is now being pumped directly from wells, he said.

“We didn’t fix all the things that were destroyed. We fixed what can help the oil flow through the pipeline. Now the oil has reached the refinery in Khartoum,” the minister added.

Screens behind him showed video of the damage, and the repair operation.

Officials allege that the South Sudanese, who occupied the area for 10 days, had deliberately damaged the pipeline and an adjacent central processing facility and power plant, where a fire left partly blackened and burned, with oil seeping onto the ground.

Although Sudan escorted journalists and foreign ambassadors on brief visits to the damaged facility, there has been no opportunity for an independent investigation of what happened.

South Sudan’s army alleged during its occupation that Sudan had bombed the Heglig area “indiscriminately” and that an air raid struck a Heglig oil processing facility, setting it ablaze.

Sudanese officials say the Heglig region produced roughly half the national production, 50,000-55,000 barrels a day.

Asked when full output can resume, al-Jaz said only: “It will come back to full capacity after we fix all the defects.”

He said a full assessment of damage has not yet been made.

The facility is operated by Greater Nile Petroleum Operating Co (GNPOC), owned 40 percent by China’s CNPC and 30 percent by Petronas of Malaysia, according to the company website.

Analysts said the loss of Heglig production would worsen an economy already in crisis after South Sudan separated last July with about 75 percent of the former united Sudan’s oil production and billions of dollars in revenue.

Sudan declared on April 20 that its army had forced Southern soldiers out of Heglig. South Sudanese President Salva Kiir had already announced that his troops would leave under “an orderly withdrawal,” which they completed on April 22.

Ibrahim Yousif Gamil, a GNPOC manager, told journalists in Heglig last week that the plant’s IT system was down, trucks were burned or looted and even the coveralls were gone.

Only 120 employees were back on the job, out of the more than 4,000 staff and contractors normally in Heglig, Gamil said.

A giant round storage tank with a capacity of 300,000 barrels was leaking after hits by what Gamil described as a rocket propelled grenade, while support buildings had been damaged and apparently ransacked.

An international economist estimated last week that Sudan’s already depleted oil revenues had shrunk by a further 20 percent — more than $700 million — after Heglig was damaged.

The shutdown represents a major loss for the government, since it had earned significant revenue by selling its share of the oil on the domestic market.

“There may be added fiscal costs because of the need to import oil,” said the economist, who declined to be named.