London — Trading house BB Energy has filed a case against South Sudan in London for failing to deliver oil owed under a prepayment deal, according to court filings and a company spokesperson.
One of the world’s poorest countries, South Sudan has endured two civil wars in the past 15 years and is grappling with increased debt and a shaky peace deal. In March, the government placed its petroleum minister and other officials under house arrest.
BB Energy filed the case in June, court records show. A company spokesperson said the action was necessary to preserve BB Energy’s rights under a contract with the petroleum ministry.
“As yet, they have defaulted on delivery,” the spokesperson said. “We are in the process of serving formal proceedings; however we are always looking to find an amicable solution, especially considering our long-term interests in the country.”
Officials in South Sudan did not immediately respond to a request for comment.
Oil trader Vitol also filed a case against South Sudan in London in May, but said it had since resolved the issue. Sources said that case related to a single cancelled oil cargo.
In May, a London court ordered South Sudan to pay Afreximbank $657m over defaulted loans. The IMF pegged South Sudan’s total public debt at $3.7bn by 2023, with $550m of the total owed to oil companies.
At its peak before the civil war, South Sudan’s crude oil production stood at 350,000-400,000 barrels per day (bpd), but that tumbled to just 72,000 bpd last year, according to Opec data, after a damaged oil pipeline halted exports.
The pipeline resumed operations in June, and the country pumped 138,000 bpd that month.
Reuters
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