20 February 2013

South Sudan Denies It Plans to Abandon Lamu Port Project

Juba — South Sudan has disputed reports claiming it may abandon the plan to develop a crude oil pipeline between its oil fields and the port of Lamu in neighbouring Kenya.

The Kenya-based Standard newspaper, early this week, quoted the chairperson of New Sudan Federation (NSF), Costello Garang Ring, saying South Sudan could consider going to Djibouti or Tanga, "if the speed with which the Kenya Government is constructing Lamu port and doing the railway does not change dramatically".

Barnaba Marial Benjamin, South Sudan's information minister told journalists the NSF chairperson might have been quoted "out of context".

"I can assure you that there is no way that the Republic of South Sudan is going to pull out of the Lamu project because it a project that has a lot of future for the three countries, including our own country," he said.

Marial said the project, estimated to cost between $22-23bn, is a multiple approach project, to which the three countries of Kenya, South Sudan and Ethiopia have committed themselves.

"It is geared towards development. In this project, there is the construction of highways, tourist cities, a pipeline [South Sudan-Kenya pipeline], the port, an airfield and railway lines connecting the two countries", the minister told Sudan Tribune.

Marial said construction of the pipeline through the Kenyan port of Lamu will begin when feasibility studies, contracted to German company ILF, are completed by the end of the year.

He expressed optimism that the country could export its oil via the Kenyan transport link by 2014, if construction started immediately after completion of feasibility studies on the proposed route.

Last week, South Sudan council of ministers unanimously agreed to endorse the petroleum and mining policy framework of the oil ministry, which will guide petroleum and mining activities, as well as the operation of the ministry and partners.

The new policy, officials say, will particularly play vital roles in laying out procedures and processes relating to granting contracts to international and national companies wishing to invest in the petroleum and mining sector.

South Sudan shutdown oil output a year ago following a dispute over how much the new nation should pay in pipeline fees to transport crude via its northern neighbour for export from Port Sudan.

At African Union-backed talks in Ethiopia last month both governments failed to reach agreement on a number of sticking points, including the South's alleged ongoing support for northern rebels and the withdrawal of troops from border regions - a prerequisite for resuming oil exports.

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