South Sudan expects 1 million barrels oil to leave Sudan on Saturday

JUBA Fri Jun 28, 2013 12:06am BST

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JUBA (Reuters) - South Sudan expects a first oil shipment of 1 million barrels to sail from Sudan's Port Sudan terminal on Saturday, despite a threat from Khartoum to halt cross-border flows, its oil minister said on Thursday.

Sudan notified its landlocked neighbour to the south two weeks ago it would close the two export pipelines to Port Sudan within two months unless Juba gave up its support of rebels operating across the shared border.

South Sudan, which needs to export its oil through Sudan, denies the claims. The country had in January 2012 shut down its entire output of around 300,000 bpd in a row with Sudan over pipeline fees, but both agreed to resume pumping in March.

Khartoum has said it will allow the sale of oil already in the pipelines or tanks in Port Sudan.

South Sudan sold this month one million barrels of Dar Blend, its main crude product, which will be shipped from Saturday, Oil Minister Stephen Dhieu Dau told Reuters. Loading will end on July 3, he added, without giving more details.

A trading source told Reuters the first ships had been already loaded in Port Sudan. That oil will likely come from China National Petroleum Corp, which runs the oilfields with India's ONCG Videsh and Malaysia's Petronas in South Sudan.

CNPC sold 1.2 million barrels in early June, the first export deal since the shutdown in 2012.

Two tankers left Port Sudan in the past few days, according to a worker in the marine terminal located outside the city. A third tanker was currently being loaded, he added, asking not to be named.

Mawien Makol Arik, spokesman of South Sudan's foreign ministry, said the oil was still flowing to Port Sudan, despite the Sudanese threat.

Abu Bakr Saddiq, spokesman for Sudan's foreign ministry, said he had no information on any loading. He also reiterated that oil cargos which had arrived in the pipelines before the shutdown decision were being exported.

Analysts doubt Sudan will close the pipelines as Khartoum badly needs the associated fees to offset the loss of most its oil production since the southern secession in 2011. Oil had been Khartoum's main source of revenue for the budget as well as dollars needed to fund imports.

(Additional reporting by Florence Tan in Singapore; writing by Ulf Laessing, editing by Jeff Coelho, G Crosse)

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