South Sudan
Oil

The oilfields in South Sudan have been significant to the economy since the latter part of the 20th century. In 2023, oil constitutes more than 90% of state revenues. The country has the third-largest oil reserves in Sub-Saharan Africa. However, after South Sudan became an independent nation in July 2011, southern and northern negotiators were not immediately able to reach an agreement on how to split the revenue from these southern oilfields.

It is estimated that South Sudan has around 4 times the oil deposits of Sudan. The oil revenues, according to the Comprehensive Peace Agreement (CPA), were split equally for the duration of the agreement period. Since South Sudan relies on pipelines, refineries, and Port Sudan 's facilities in Red Sea state in Sudan, the agreement stated that the government of Sudan in Khartoum would receive a 50% share of all oil revenues. This arrangement was maintained during the second period of autonomy from 2005 to 2011.

In the run up to independence, northern negotiators reportedly pressed for a deal maintaining the 50–50 split of oil revenues, while the South Sudanese were holding out for more favourable terms. Oil revenues constitute more than 98% of the government of South Sudan's budget according to the southern government's Ministry of Finance and Economic Planning and this has amounted to more than $8 billion in revenue since the signing of the peace agreement.

After independence, South Sudan objected to Sudan charging US$34 per barrel to transport oil through the pipeline to the oil terminal at Port Sudan. With production of around 30,000 barrels per day, this was costing over a million dollars per day. In January 2012, South Sudan suspended oil production, causing a dramatic reduction in revenue and food costs to rise by 120%. In 2017, Nile Drilling & Services became South Sudan's first locally owned and run petroleum drilling company.

China National Petroleum Corporation (CNPC) is a major investor in South Sudan's oil sector. South Sudan's economy is under pressure to diversify away from oil as oil reserves will likely halve by 2020 if no new finds are made, according to the International Monetary Fund (IMF).
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