Petroliam Nasional Bhd’s (Petronas) unit Petronas Carigali Nile Ltd (PNCL) on Wednesday announced its withdrawal from the South Sudan after 14 years of operations.
PCNL’s presence in South Sudan oil and gas industry is based on a joint operating company (JOC) model with interests three JOCs which operate Block 3/7 (40 per cent), Block 1/2/4 (30 per cent), and Block 5A (67.9 per cent).
The assets include interests in 64 producing fields and 2021 average gross production of 153,200 barrel a day of oil.
Partners in the JOCs include China National petroleum Corp, Sinopec, india’s Oil and Natural Gas Corporation Ltd, and Nilepet, the national oil company of South Sudan.
The announcement of the withdrawal came on the same day British independent energy company Savannah Energy said it was aborting an up to US$1.25 bilion deal, made in 2022, to purchase Petronas’ assets in South Sudan.
In the statement posted on its website, Savannah Energy said Petronas has served notice to unilaterally withdraw from its interests in the relevant exploration & production sharing agreements.
Savannah Energy said it remains in active discussions with the relevant parties around an alternative potential transaction in relation to an acquisition of the Petronas assets.
In a short statement on its website, Petronas said the decision to withdraw was made as part of a two-year period of divestment initiatives to align with Petronas’ long-term investment strategy amid the changing industry environment and accelerated energy transition.
“PCNL will continue to work with all relevant stakeholders to ensure an amicable transition while being mindful of the rights of its employees, in accordance with applicable laws, petroleum agreements as well as Petronas’ policy and procedures,” Petronas said.
As early as September 2023, news broke that the South Sudanese presidency was eyeing Petronas’ stakes in the JOCs there.
The US$3 billion deal with US’ Caltech Investments was to jointly purchase Petronas’ stakes and other investments.