You’re Not Poor, Your Tech is Poor: South Sudan’s $4.5bn Hides in Plain Sight

How does South Sudan claim its EXTRA $4.5 billion annually? The answer: Go for superior drilling technology, replacing the current technology, says Dr. Lual Deng.

By the estimates of the former Petroleum Minister and World Bank Economist, superior technology from the United States could increase oil production income by $12.5m a day, he has told the Revised National Development Strategy conference at Freedom Hall June 22.

SUPERIOR U.S. TECH

“With American technology, we can hit a production capacity of 500000 barrels a day by the year 2030. That, at an estimate of $50USD per barrel, will translate into $12.5 million dollars a day and $4.5 billion dollars annually, which is enough to fund the RNDS,” while responding to a question on how to finance South Sudan’s Revised National Development Strategy (RNDS) 2024 this morning at Freedom Hall in Juba.

“Get rid of the inferior Chinese Technologies and acquire American Technology, then you will see the difference. Don’t ask me how because I have been there (petroleum ministry) and I know the difference”, he said, adding that the country has not used up even 10 percent of its reserves.

The RNDS, the country’s third development blue print seeks to put the country on a sustainable path and promises a robust re-engagement with the country’s development partners.

South Sudan produces roughly 150,000 to 170,000 barrels a day, but its profit stands at between fifth to a quarter of the value of the oil (roughly 45,000 barrels) after removing production costs owed to oil companies and transit fees paid to Sudan.

By this estimate, increasing production by half a million barrels would not earn government an extra $4.5 billion, as per Dr. Lual’s estimates, but would bring in $1 billion profit at most.

The use of Chinese technology in South Sudan’s oil sector is mainly associated with the China National Petroleum Corporation that first joined the petroleum industry in Sudan in 1995. CNPC established its South Sudan office after independence to handle operations in the south, closing office for a year after war broke out in 2013.

THEN, ROADS AND PIPELINES

First Vice President Dr. Riek Machar attended the launch of the RNDS, facilitated by UNDP. The petroleum docket falls under the SPLM in Opposition.

“When you increase investment in oil pipelines and roads infrastructure, you will spark up growth in the non-oil sectors which will translate into a lot of money,” said Lual, adding that for all this to work, there had to be what he referred to as the three Ps. “There has to be Political will to get Peace and then you can have institutions to manage Public Finance.”