South Sudan oil export pipeline to come thru Kenya
Toyota Tsusho Corporation (Toyota Tsusho) increases its foothold in East Africa in leading the $3 billion South Sudan oil export pipeline project and in signing a Memorandum of Understanding (MOU) with the Republic of Kenya.
In South Sudan, the oil revenues represent 98% of the country total revenues.
South Soudan also accumulates 75% of the previously unified Sudan oil reserves.
In this context, exporting oil is vital for South Sudan, a state newly created in July 2011 from the scission with the northern part of Sudan.
So far the export of the oil production in South Sudan was going up to Port Sudan on the Red Sea by a north pipeline crossing Sudan.
But disagreements between the two countries about the quantity of oil being carried out and the fees to come across Sudan ended up with South Sudan to shut down its export pipeline in January 2012.
These disputes were resolved few weeks ago with an agreement on the fees and pending payments.
In parallel South Sudan investigated other potential routes for an oil export pipeline directly to the Indian Ocean instead of the Red Sea.
From these conceptual studies, South Sudan selected two alternative routes to:
– Port of Lamu in Kenya
– Djibouti in passing through Ethiopia
For the both oil export pipelines, Juba, the Capital of South Sudan, signed MOU with both countries, Ethiopia and Kenya.
These oil export pipelines are also designed to meet the increasing quantity of oil produced in South Sudan and the demand in Ethiopia and Kenya.
With the support of International oil companies (IOCs), South Sudan expects to increase production from the actual 350,000 b/d to 500,000b/d.
Toyota Tsusho to work on the $3 billion Kenya pipeline
Nagoya-based in Japan, Toyota Tsusho announced last June to have completed the feasibility study for the South Sudan Kenya oil export pipeline.
From this feasibility study, the South Sudan Kenya pipeline should be 2,000 kilometers long and should require $3 billion capital expenditure.
Now Toyota Tussho and the South Sudan Government are working on a new contract for the engineering, procurement and construction (EPC) of the Kenya pipeline.
In parallel and to speed up the construction of the pipeline, Toyota Tsusho signed a MOU with the Kenya Government for multiple activities including:
– Petroleum and mining
– Automobile trading
– Power and Energy
– Environmental infrastructures
– Agriculture Industrialization
After acquiring the CFAO company from the French Group PPR on July, Toyota Tsusho is building up its Market Leadership as Africa‘s number one trading company.
With South Sudan, Kenya and Toyota Tsusho, having signed contracts or Memorandum of Understanding (MOU) between each other, all the conditions are set to proceed with the engineering, procurement and construction (EPC) of the South Sudan Kenya oil export pipeline to Port of Lamu.
