Bloomberg News

South Sudan Welcomes London Court Ruling on Disputed Oil Cargo

February 21, 2012

Feb. 21 (Bloomberg) -- South Sudan welcomed the ruling by a London court to withhold payment for a cargo of crude until ownership of the oil was settled with neighboring Sudan.

The ruling was a “positive thing” because it means that Sudan will not receive a share of the proceeds from the sale of oil “stolen” by the Sudanese government, South Sudan government spokesman Barnaba Marial Benjamin said today by phone from Juba, South Sudan’s capital. “We are satisfied as long as it doesn’t go to Khartoum.”

South Sudan declared independence in July, taking control of oil fields that produced about 75 percent of Sudan’s crude output of 490,000 barrels of a day.

Talks have so far failed to yield an agreement on how much landlocked South Sudan should pay to transport its oil through a pipeline across Sudan. South Sudan halted output last month after Sudan confiscated southern crude, saying it was taking it to make up for unpaid fees.

The disputed oil includes 600,000 barrels of Nile Blend that Sudan loaded onto the oil tanker Ratna Shradha on Jan. 19. Oil trader Trafigura Beheer BV, confirmed yesterday that the court ruled that all proceeds from the shipment, which it bought from Sudan and sold to Tokyo-based JX Nippon Oil & Energy Corp, remain with the court until ownership is legally established.

Sudan Foreign Ministry Spokesman al-Obeid Murawih didn’t answer his phone when Bloomberg called seeking comment.

--Editors: Hilton Shone, Ben Holland

To contact the reporter on this story: Jared Ferrie in Juba, South Sudan at jferrie1@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net


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