Political fears scare oil investors in Southern Sudan

Southern Sudan government officials said this week that the rush for the vast region’s massive oil wells has been slow in coming since the signing of a peace accord slightly over two years ago.

Optimists say investor interest is there, but the potential oil hunters do not know where to begin.

Pessimists cite the lack of an assurance on the future governance structure and rampant insecurity for the sluggish pace of oil investors.
“There are two ways I would like to look at Sudan, a kind of analogy,” Canadian lawyer Jay Park, a partner of International Energy Group told the recently concluded international investment conference for Southern Sudan.

“You have remnants of buried treasure and you do not know how to find it or how big it would be,” he told participants at the conference which ended in Nairobi on March 15.

Sudanese authorities have been hosting investors to an annual investment conference since the southern area attained semi- autonomy from the formerly Arab-dominated government based in Khartoum, with the signing of the Comprehensive Peace Accord.

Oil industry investors took a wait and see attitude following the signing of the peace accord in Nairobi, which was witnessed by international dignitaries, including 15 African heads of state and former American secretary of state Collin Powell.

“The question investors ask is how do we get in? There is a lack of clarity on where to get the mining license, the fiscal framework and political stability,” says Stewart Williams, a Senior Analyst, Africa Energy Research, Wood Mackenzie.

People’s Daily