China deploys soldiers to a UN peacekeeping force in South Sudan

United Nations peacekeepers secure a section of Juba airport in South Sudan on Aug. 12.

China’s state-owned National Petroleum Corp. holds a 40% stake in a joint venture that operates in South Sudan’s vast oil fields. The company also has a 1,000-mile (1,600-kilometer) export pipeline that carries crude through neighboring Sudan to Port Sudan on the Red Sea.

Before the latest fighting in South Sudan flared, the country accounted for 5% of China’s crude imports. Output has since plummeted by a third to 160,000 barrels a day—following the outbreak of fighting late last year.   China began deploying 700 soldiers to a United Nations peacekeeping force in South Sudan to help guard the country’s embattled oil fields and protect Chinese workers and installations September 9.

“We feel it is not the business of UNMISS [peacekeeping mission]to protect oil installations, whether the Government is capable or not,” Government  spokesperson Lul Ruai Koang said at the time. “By stepping in to protect oil installations on behalf of the Government, UNMISS will have sided with one of the parties to the conflict and inevitably become part of the problem, not the solution.”

But the UN clarified that it was mandated to protect civilians, including those working in the oil sector, but not the actual oil installations.

[October 18 2010]
Oil pipeline to Kenya

As for the coming referendum, January 9, 2011 [maybe] on Southern independence, while the resources may be in the southern areas, the infrastructure for exporting them is in the northern area, an attempt to suggest the futility of independence for the south.

That may be, but it has not stopped speculation about the construction of an oil pipeline from southern Sudan to a new port development planned for Lamu on Kenya's Indian Ocean coast.

The pipeline proposal, made by Japan's Toyota Tsusho, the trading subsidiary of automaker Toyota, means that southern Sudan might just be able to ease away from dependence on the north after any vote on secession. here

South Sudan Oil through Doba?

The UNSC on May 17 passed a resolution demanding the finalization of a jointly-run administration and police force for the disputed oil-rich border region of Abyei. The Council also demanded the immediate withdrawal of Sudanese security forces from Abyei, following South Sudan's troop pullout from the disputed region last week.


Border clashes between the two countries erupted in late March, marking the biggest confrontation between the two sides after South Sudan seceded from Sudan in July last year in line with a 2005 peace agreement ending 22 years of civil war between the Arab North and the Christian and animist South. More than 100,000 people are said to have been displaced by the ongoing hostilities.


Tensions escalated after South Sudanese forces moved into the oil-producing region of Heglig in Sudan's South Kordofan state on April 10, before eventually vacating the area. Sudan, which had responded by bombing South Sudanese territory, has since regained control of Heglig, which accounts for 60,000 of the 115,000 barrels of oil produced in Sudan daily.The oil fight is relatively easy to solve, if there is political will. South Sudan now has three-fourths of the old Sudan’s oil resources, but that isn’t much good without a way to get it to market. (A planned pipeline via Kenya is years, and billions of dollars, in the future.) The absurd discrepancy in the value that the two sides put on using Sudan’s pipeline ($36 versus $.60 a barrel) can be resolved by invoking global benchmarks. Market prices suggest a rate of $1 to $2 a barrel would be reasonable.

global oil demand growth versus supply base

“You need a certain level for all these high-priced resources that are coming on-stream, deepwater Gulf of Mexico, deepwater Brazil and the Canadian oil sands. That’s the dynamic part of the non-OPEC oil supply.”
“Concerns over a Eurozone-centered debt crisis, and the Chinese economy, and U.S. financial regulations, have no impact on full-cycle production costs or on the medium-term view,” said Mike Wittner, head of oil market research at Societe Generale SA in London. “And the medium-term view is one of global oil demand growth bumping into a mature supply base.” The futures contract closest to delivery on the New York Mercantile Exchange tumbled 10 percent in the past three months to below $70 a barrel as investors fled riskier assets and the December 2015 contract lost 4 percent. At the same time December 2018 futures remain above $90 a barrel,