An international consortium of investors and companies has announced it will purchase and transform Sudan into a low-carbon energy hub, which will include oil, gas and electricity transmission lines, as well as a liquefied natural gas export terminal.
Sudan’s energy sector is already undergoing rapid change due to climate change, but the country is already facing a severe water shortage and severe air pollution that have led to outbreaks of malaria and respiratory infections.
The country’s oil production is estimated at about 3 million barrels per day (bpd) and gas is expected to reach 8 million bpd by 2020, according to the International Energy Agency (IEA).
The project, to be called “Oman Energy Center,” is one of the largest projects in the region and the first in the world to be financed by international investors.
“This is a big deal,” said Alroya Alawani, head of Sudanese Oil Company (SOCOM), one of three energy-producing companies involved in the project.
“The government of Sudan needs to have a plan to transform itself into a modern energy hub.”
SOCom will pay $1 billion, with a portion of that coming from the Arab Gulf states of Qatar, Kuwait and Saudi Arabia.
The consortium will work with Sudan’s Ministry of Petroleum to buy and transform energy infrastructure that includes electricity transmission and distribution lines, oil fields and other infrastructure.
Oil will be delivered from the project, and the project will also provide energy for local industries, SOCOM said.
All of the infrastructure will be powered by Sudan’s existing oil resources, with the exception of the pipeline from Omera, the site of Omeran, which is currently under construction.
Alroya said that Sudan will continue to operate the Omeras oilfield.
“We are committed to building the infrastructure for oil production, not just for export, and this will make Omerania a very important hub in the Middle East,” Alawania said.
“I think the new Omerans will be able to make significant investments in Sudan’s future.”
The consortium is expected in 2019 to begin the process of transferring a portion or all of the oil and gas assets to the Sudanese government, SOCom said.
The project is also expected to include oil and natural gas pipelines from the Obera Basin in western Sudan, as Sudan has yet to construct a pipeline from the Bakal valley to the southern border of Sudan, where it has been struggling to meet domestic demand.SOCO said that the Sudan-based consortium is planning to use Sudanese resources to export its liquefiers to the Middle Eastern markets, and it plans to import Sudanese oil from the country’s Omer oilfields.
SOCOM hopes to export the oil to the United Arab Emirates (UAE), which is an oil exporter.
The project has also been welcomed by the United Nations Development Program, the World Bank, and other international donors, which say it is a significant development.
The United States has already pledged $1bn, and more could be forthcoming, SOCO said.
“We’re not looking for an easy road,” Alroyan said.
But he added that Sudan’s infrastructure was the best in the Arab region.
“It’s a new era, a new way to build a modern, reliable energy infrastructure,” he said.