Sudan

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Gold in Sudan

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Geology

The gold mineralization of the Red Sea Hills area occurs within Niferdeib greenstone belts trending roughly north-east. They are from north to south: the Onib-Hamissana-Sol Hamed belt (Onib and Eight gold mines), the Serakoit-Gebeit-Fodikwan belt (Serakoit and Gebeit gold mines), the Ariab-Oshib-Arbaat belt, the Derudeb-Sinkat belt and the Karora belt.
In the Ariab area, 10 gold-bearing volcanogenic massive sulphide (VMS) deposits have been identified and investigated.
  • La Mancha Resources Inc owns a 40% interest in the Hassaï mine, located in the north-eastern part of Sudan. The Hassaï property is the only mine in operation in Sudan and La Mancha is acting as the operator. The remaining ownership of the mine is held by Sudanese government agencies and by French private entities, respectively comprising of a 56% and 4% ownership share. Hassaï mine produced 34,760 oz of gold attributable to La Mancha in 2007. Preliminary exploration work is being done in the Mt. Nuba area.
  • Gebeit is an ancient gold mine, which was worked intermittently between 1904 and1989. Reserves in 1986 were estimated to be 375 000 t at a grade of 15 g/t Au.
  • Arab Mining, a joint venture between the government (60%) and La Source, started production at the Hadal Auatib Gold Mine in 1991.
  • Compagnie Miniere Or operates the Ariab Mbabane (Inguessana Hills) mine which reportedly produces 5 t of gold per year.
  • The VMS deposits of the Ariab area are Habdul Auteb, Oderuk, Hassai, Talaideruk, Baderuk, Hassai North, Komoeb, H Veins and Ganeit. The combined gold content has been estimated at 32,8 t.
  • New Kush Exploration and Mining Company has shown interest in mining gold from Kapoeta East County of Eastern Equatoria state. New Kush Exploration and Mining Company are a merger of two companies-British and South African.

Oil and Natural Gas

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Sudan is developing its significant hydrocarbon resources. The country’s oil exports, which have increased sharply since the completion of a major oil-export pipeline in 1999, account for 70 percent of total export revenues. Additional growth in Sudan’s hydrocarbon sector will likely occur with a refurbished infrastructure, which has seen little improvement since the beginning of the country’s civil conflicts in 1955. As of January 2007, according to the Sudanese Minister of State for Energy and Mines, Sudan is considering joining the Organization of Petroleum Exporting Countries (OPEC) at some point in the future.
According to Oil and Gas Journal (OGJ), Sudan contained proven oil reserves of five billion barrels as of January 2007 up from an estimated 563 million barrels of proven oil reserves in 2006. The majority of proven reserves are located in the south in the Muglad and Melut basins. Due to civil conflict, oil exploration has mostly been limited to the central and south-central regions of the country. It is estimated that vast potential reserves are held in northwest Sudan, the Blue Nile basin, and the Red Sea area in eastern Sudan.
The Sudan National Petroleum Corporation (Sudapet) is active in Sudan’s oil exploration and production. However, due to its limited technical and financial resources, Sudapet often develops joint ventures with foreign companies in oil projects. Foreign companies involved in Sudan’s oil sector are primarily from Asia. They are led by the China National Petroleum Corporation (CNPC), India’s Oil and Natural Gas Corporation (ONGC) and Malaysia’s Petronas.

In October 2005, Sudan established the National Petroleum Commission (NPC) to bolster the development of the country’s oil resources. To accomplish its mission, NPC allocates new oil contracts, and it ensures an equal sharing of oil revenues between the national government in Khartoum and the Government of South Sudan (GoSS). In addition, NPC is responsible for resolving duplicate oil contract issues in which the GoSS has allocated contracts overlapping contracts previously granted by Khartoum. NPC is currently scrutinizing duplicate contracts given to Total and White Nile Ltd. over Block B and the White Nile Petroleum Operation Company (WNPOC) and Ascom Group of Moldavia over Block 5b. President Bashir is believed to co-chair the NPC with Vice-President Salva Kiir, who also heads the GoSS.
Oil production has risen steadily since the July 1999 completion of an export pipeline that runs from central Sudan to the Port of Sudan. In 2006, crude oil production averaged 414,000 barrels per day (bbl/d), up from 363,000 bbl/d in 2005. According to Angelina Tany, Minister of State for Mines and Energy, Sudan plans to be producing one million bbl/d of crude oil by the end of 2008.
China accounts for 60% of oil exports from Sudan. China obtained oil exploration and production rights in 1995 when the China National Petroleum Corporation (CNPC) bought a 40% stake in the Greater Nile Petroleum Operating Company, which is pumping over 300,000 barrels per day. Sinopec, another Chinese firm, is building a 1500-kilometer pipeline to Port Sudan on the Red Sea, where China’s Petroleum Engineering Construction Company is constructing a tanker terminal.
  • Oil production: 344,700 bbl/day (2004 est.)
  • Oil exports: 275,000 bbl/day (2004)
  • Oil proved reserves: 1.6 billion bbl (2006 est.)
  • Natural gas proved reserves: 84.95 billion cu m (1 January 2005 est.)
  • Blocks 1, 2 and 4: In 1996, Canadian independent Arakis Energy (Arakis) began development of the Heglig and Unity fields (Blocks 1, 2, and 4), which contain estimated recoverable reserves of 600 million - 1.2 billion barrels of oil. Because the fields are not located near the Red Sea coast, Arakis entered into a consortium with the Greater Nile Petroleum Operating Company (GNPOC) to raise investment for a 994-mile pipeline from the fields to the Suakim oil terminal near Port Sudan. In September 1999, the first cargo of crude departed the export terminal. Although GNPOC originally constructed the pipeline with throughput of 150,000 bbl/d, its has since been increased to 300,000 bbl/d, while maximum capacity is estimated at 450,000 bbl/d. As of January 2007, combined production from Blocks 1, 2, and 4 was estimated at 260,000 bbl/d. The GNPOC joint venture is operated by CNPC (40 percent), with partners Petronas (30 percent), ONGC (25 percent) and Sudapet (5 percent).

    Blocks 3 and 7: In June 2004, Petrodar, a consortium of CNPC (41 percent), Petronas (40 percent), Sudapet (8 percent), Gulf Oil Petroleum (6 percent), and the Al-Thani Corporation (5 percent) awarded a $239 million contract to Malaysia’s Ranhill International and Sudan’s Petroneeds Services International for development work on Blocks 3 and 7. The blocks contain the Adar Yale and Palogue oil fields, with estimated recoverable reserves of 460 million barrels. As of January 2007, Blocks 3 and 7 combined produced an estimated 165,000 bbl/d of oil. The fields could reach peak production of 200,000 bbl/d by late 2007. In November 2005, CNPC brought online the Petrodar pipeline linking the two blocks to Port Sudan. The pipeline has current throughput of 150,000 bbl/d and maximum capacity of 500,000 bbl/d. The project also includes a 300,000 bbl/d central processing facility at Al-Jabalayan and production facilities at Palogue.

    Block 5a: In April 2005, the Sudanese government signed an agreement with WNPOC for the development of the Thar Jath and Mala fields on Block 5A. First oil from the block came online in June 2006 at an initial rate of 38,000 bbl/d. As of March 2007, the field was still producing at 38,000 bbl/d, while full capacity is estimated at 60,000 bbl/d. Oil from the field flows through a 110-mile pipeline to Port Sudan. WNPOC is a consortium of companies, which include Petronas (68.875 percent and operator), ONGC (23.125 percent) and Sudapet (8 percent).

    Block 6: In November 2004, CNPC brought online its Fula field on Block 6 at a rate of 10,000 bbl/d. Current output on the block is 40,000 bbl/d, but is expected to eventually reach 80,000 bbl/d. CNPC has constructed a pipeline that links the Fula field to the Khartoum refinery.


    Source: IHS Energy GEPS Reports

    Exploration and development of Sudan’s oil resources has been controversial. International human rights organizations have accused the Sudanese government of financing human rights abuses with oil revenues, including the mass displacement of civilians near the oil fields. Factional fighting in the South and rebel attacks on oil infrastructure have kept oil production and exploration from reaching full potential to date. In October 2004, for example, the Sudanese government prevented a militia attempt to sabotage the country's main oil export pipeline. However, the 2005 Comprehensive Peace Agreement (CPA) between the northern government in Khartoum and the GoSS could facilitate additional investment in both production facilities and new exploration initiatives in Sudan. In January 2005, after the official signing of the CPA, IOCs including Total, Marathon Oil Corporation, and the Kuwait Foreign Petroleum Exploration Company (KUFPEC) renewed their exploration rights in southern Sudan.

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