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According to OVL, Khartoum only made representatives – including some high-ranking
11 of the 18 promised payments, with the managers – have told the Indian press that this
last coming near the end of 2010. Since then, move is in the works.
it has not turned in the remaining seven If so, the exit appears to be justified – and not
payments, which were supposed to total just because the Sudanese government is not
$98.94mn – that is, the $99mn sum men- meeting its financial commitments. GNPOC is
tioned above. also a relatively minor asset. As of
Additionally, it said in late 2016 mid-September, the consortium
that it would not grant GNPOC’s was only producing about 28,000
request for an extension of the con- GNPOC is a barrels per day (bpd) of oil from
tract for Block 2B. As a result, the Block 2A. It was also extracting no
acreage under the consortium’s relatively minor oil whatsoever from Block 4, which
control shrank. asset. As of mid- has yet to move past the exploration
At first, the Indian firm hoped phase.
that making its case through dip- September, the Under current market con-
lomatic pressure would suffice, ditions, this small amount of oil
so it asked New Delhi to press consortium was hardly seems to be worth the
its case with Khartoum. After trouble. Certainly, OVL’s partners
this tactic failed, though, it filed only producing appear to have reached the same
an arbitration case against Suda- 28,000 bpd from conclusion; Indian news agencies
nese authorities. And in 2019, it reported last week that the other
started talking publicly about the Block 2A foreign shareholders in GNPOC –
possibility of withdrawing from China National Petroleum Corp.
GNPOC. It reportedly informed officials in (CNPC), the operator, with 40%, and Petronas
Khartoum of its position shortly after the (Malaysia), with 30% – were also quitting the
country’s previous government, headed by Ali project. (Presumably state-owned Sudapet will
Bashir, stepped down. hold on to its 5% stake.)
This is not good news for Sudan. The country
Impact on local fuel sector has already experienced multiple rounds of fuel
Now it appears that OVL has definitely decided shortages this year, and it is likely to experience
in favour of withdrawal. The company has not further supply disruptions if its refineries lose a
officially confirmed reports to this effect, but its source of feedstock.™

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