South Sudan Nile Petroleum takes control of former PETRONAS oil and gas assets

(Bloomberg) — South Sudan’s state-owned Nile Petroleum Corp. has taken over oil fields and assets that belonged to a subsidiary of Malaysian oil company Petroliam Nasional Berhad (PETRONAS).

The changes come less than two weeks after the Malaysian conglomerate announced it would leave South Sudan after 14 years. UK-based oil and gas company Savannah Energy Plc is in negotiations to buy the company.

Nilepet will now “take over the responsibilities previously held by PETRONAS,” said Chol Deng Thon Abel, Permanent Secretary of the South Sudanese Ministry of Petroleum. “All assets and shares of Petronas will now be transferred.”

The company will seek a new partner to ensure continued operations, he said in a statement on Monday.

PETRONAS has abandoned its investment due to rising costs caused by a broken pipeline that carries two-thirds of South Sudan’s crude oil through neighboring Sudan, where war has raged for more than a year. The conflict has caused damage to one of two pipelines after a shortage of diesel to dilute the crude caused the line to rupture.

The landlocked country of South Sudan declared its independence from Sudan in 2011 and is still dependent on oil exports from its northern neighbor. The country represents almost the entire source of the state’s income.