Oil Companies reject loan request by Kiir government
International oil companies operating in South Sudan recently rejected a request by the South Sudanese government for an advance on oil earnings, according to a report by a leading financial newspaper.
The government already owes more than a $1,600,000,000 to the oil companies.
South Sudan has two oil-producing states, Upper Nile and Unity, but the latter has not produced any oil this year because the oil wells were closed last December.
The Wall Street Journal, an American business newspaper, reported that South Sudanese officials recently proposed an emergency loan of $200 million to oil companies.
At a meeting in June, the officials presented the loan proposal to executives of Chinese, Malaysian, Indian oil companies, including ONGC Videsh, CNPC and Petronas.
During the same meeting, the finance minister reportedly told the executives that the country could not service existing debts of $1.6 billion that it had already borrowed from the companies.
This was the government’s fourth request since last year.
The Journal reports that the executives responded that they “no longer wanted to offer hundreds of millions of dollars in advances with dim prospects of returns.”
“South Sudanese [officials] stormed out of the meeting, according to a person with direct knowledge of the matter.”
As quoted by the same newspaper, the presidential spokesman Ateny Wek Ateny acknowledged the impact of the government’s cash shortage.
“We are having challenges raising money to pay some soldiers because we are not producing enough oil,” he was quoted as saying.
- Database Search
- Unpaid Debt A comprehensive overview of the role of the Lundin Consortium in the oil war. ECOS calls upon the Swedish, Austrian and Malaysian governments to investigate whether, as a matter of international law, Lundin, OMV and Petronas 'were complicit in the commission of war crimes and crimes against humanity by others during the period 1997-2003.’ In response, the Swedish Public Prosecutor for International crimes opened a criminal investigation into ‘links between Sweden and the reported crimes’.
- In Depth For more specific information about the Lundin court case please visit the Unpaid Debt dossier.
