The Nile Petroleum Corporation or Nilepet board of directors has resolved to take full ownership of the oil sector by 2027, according to an official.
The Nile Petroleum Corporation, known simply as Nilepet, was set up to ensure the people of South Sudan are represented in their country’s oil sector.
Currently under the office of the president, it holds shares in each of the joint venture companies set up to extract oil, while also holding primary responsibility for importing refined fuel.
In 2018, a Global Witness investigation accused Nilepet of having fallen under the direct control of President Salva Kiir and his inner circle and is being used to funnel millions in oil revenues to the country’s brutal security services and ethnic militias, with limited oversight and accountability.
In a meeting shared by Nhial Deng, the minister of the presidential affairs and the board of directors of Nilepet, resolved to reform the company.
Speaking to the press after the meeting, the managing directors of Nilepet said the board has resolved to take full ownership of the oil sector by 2027.
“The national oil company should be ready to take ownership of the oil company by 2027… to maximize the revenue,” Bol Ring, managing director, told the media.
Nilepet was established via Section 13 (1) of the Petroleum Act 2012 with a mandate of participating in the upstream, midstream and downstream activities of oil and gas of the petroleum sector on behalf of the Government of the Republic of South Sudan.
It was incorporated in 2009 after the Comprehensive Peace Agreement of 2005.
In 2011, it took over from the state-owned oil company of Sudan, Sudapet, upon the independence of South Sudan.
Nilepet is active across the petroleum value chain, with a stake in all three operating companies, and a significant presence in the midstream and downstream sectors.
According to experts, Nilepet controls the supply of domestic and international consumption of fuel.
It on behalf of the government promotes the sustainability and growth of the national oil industry, safeguard the national oil interest and guarantee higher returns for the nation.
On its website, Nilepet says it builds “a balanced portfolio of assets, maintaining financial flexibility, and maximizing earnings and cash flows by controlling costs”.
The national oil company has majority stakes in six joint ventures, with three currently active; Nile Drilling and Services Co, Nile Delta, in partnership with Nigeria’s Niger Delta E&P, and SIPET Engineering and Consultancy Services which provides project consultancy and power plant operation and maintenance services.
While South Sudan is a producer of crude oil, experts say it lacks capacity and infrastructure to refine the crude into the fuel its population relies on.
As a result, Nilepet is deeply integrated into global oil supply chains, including international refineries and commodity traders, without which it would be unable to raise revenues.
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