October 23rd, 2017

Oil-rich South Sudan faces fuel shortage as ‘people suffer’


By Sam Mednick, The Associated Press on October 13, 2017.

In this photo of Sunday Oct. 1, 2017, cars wait in line for days at a petrol station in South Sudan's capital of Juba. The oil rich country of South Sudan is suffering one of the worst fuel shortages in years, with many people waiting for days at gas stations in order to get fuel. It is a cruel irony that ninety-eight percent of South Sudan's economy comes from oil, but the country faces one of its worst fuel crises since civil war broke out in 2013. (AP Photo/Sam Mednick)

JUBA, South Sudan – “In September there was no fuel anywhere,” Samson Kamuya says.

The exhausted 45-year-old hangs his head. He’s been waiting four days at a gas station in South Sudan’s capital, Juba, to no avail.

Wedged among hundreds of cars, trucks and desperate civilians carrying empty jerry cans, he says the fuel situation is unlike anything he’s seen in his eight years as a driver.

It is a cruel irony in the world’s youngest nation: Ninety-eight per cent of South Sudan’s economy comes from oil, but the country faces one of its worst fuel crises since civil war began in 2013.

South Sudan has Africa’s third-largest oil reserves, with 3.5 billion barrels. Based on government figures, current production should bring in hundreds of millions of dollars a year. But without refineries, the country exports crude oil and must import fuel.

Some observers blame the government and Nile Petroleum, the sole state-owned oil company, for nationwide fuel shortages.

The situation deteriorated when the government “started monopolizing the fuel trade” by kicking out private oil companies to control access to U.S. dollars, says Edmund Yakani, executive director of the non-profit Community Empowerment for Progress Organization.

Nile Petroleum says it can afford to bring in only enough fuel to serve one-third of South Sudan’s population. It denies expelling private companies, saying the economic crisis forced them to leave.

“NilePet became responsible for the whole country,” says Yiey Puoch Lur, its public relations director.

However, some say the numbers don’t add up, accusing government corruption of worsening the country’s overall crisis. South Sudan soon will enter its fifth year of fighting amid starvation, mass displacement and allegations of war crimes.

“Instead of using oil revenue to provide public services and improve the livelihoods of South Sudan’s population, the ruling clique has used these funds to procure weapons, finance a horrific civil war and enrich themselves,” says J.R. Mailey, director of the investigative team at The Sentry, a Washington-based group that has reported on links between corruption and mass atrocities.

“The money’s being kept abroad,” a member of South Sudan’s parliament, who spoke on condition of anonymity for fear of his safety, told The Associated Press. The money the government should be receiving for oil exports is enough to fuel the entire country, the lawmaker says.

Nile Petroleum denies wrongdoing, blaming the lack of funds on a reduction in South Sudan’s oil production from almost 300,000 barrels a day before the civil war to roughly 130,000. It says declining global oil prices and the civil war’s damage to oil facilities have hurt.

As South Sudan held its first oil and power conference on Wednesday, Minister of Petroleum Ezekiel Lol Gatkuoth said the government is moving “aggressively” to produce more oil, with target production of 280,000 barrels per day in the coming year. The minister said four refineries would be built in the country, with one in Bentiu underway.

Gatkuoth welcomed foreign investors, saying they would team up with NilePet, then quipped that he wasn’t “encouraging them to leave – immediately”.

Civilians feel the brunt of the crisis. Drivers like Kamuya often hire people to sleep in their parked cars at the pumps while they borrow other transport to keep working.

Kamuya says he has been forced to buy fuel on the black market for almost 10 times the usual price. Instead of paying 1,200 South Sudanese pounds ($6.50) for 60 litres at the pump, he has paid up to 10,800 South Sudanese pounds ($58) for just 20 litres.

In addition, government soldiers have been accused of threatening civilians at gas stations and cutting in line to stock up on fuel to sell illegally.

“If someone tells you to move with a gun you can’t argue,” says Simon Kinuthia, a driver in Juba.

The army denies the allegations. Other than a few isolated incidents soldiers “don’t break the rules,” says spokesman Lul Ruai Koang.

Last month the Trump administration took initial steps to target those responsible for undermining stability in South Sudan, imposing sanctions on two senior members of government, the former military chief of staff and three local companies.

“Corrupt officials and their facilitators that participate in the oil sector should be subjected to targeted network sanctions,” says Brad Brooks-Rubin, policy director for The Sentry, adding that an embargo should not be placed on South Sudan’s oil industry as a whole.

“Fuel is connected to everything,” Kinuthia says. “And right now, it’s making people suffer.”


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