By Tom Bergin
DOHA Dec 7 French oil major Total
said it could build a pipeline from South Sudan to
Uganda that would continue to Kenya's coast, potentially solving
the fledgling state's headache about how to export its oil.
Total Christophe de Margerie said his company had proposed
to Uganda that a pipeline that is planned to bring Ugandan oil
to a Kenyan port be built so it could be extended to South
"The pipe, which is supposed to be from our potential
blocks, because they are not yet our blocks in Uganda, could be,
effectively, a hub for different sources of crude," de Margerie
told a press conference at the sidelines of the World Petroleum
"We say to Uganda as part of our long-term view you have to
take into consideration what sort of oil can come from neighbour
countries to make the pipe less expensive," he added.
Landlocked South Sudan took two-thirds of Sudan's 500,000
barrels a day of oil production when it became independent in
July, but it is now locked in a row with Khartoum over the use
of the northern pipeline to the Red Sea.
Khartoum has demanded a $32 a barrel fee to use the
pipeline to Port Sudan, which is more than 10 times typical
industry levels, taking account of construction cost and
South Sudan has talked to companies about building a
pipeline directly to Kenya, but analysts say it would be
difficult for the country, which still suffers civil strife, to
raise the funds required or overcome other logistical
Connecting with the pipeline planned for Uganda to Kenya
could significantly cut the total cost.
Total has agreed to buy into oil blocks in Uganda where
London-based Tullow Oil has discovered recoverable
reserves of 1.1 billion barrels, and potentally as much as 2.5
billion barrels, and Total also owns a potentially oil rich
licence in South Sudan.
De Margerie said there was no timeline for construction of
the pipeline. "It's just thoughts today," he said.
He said Malaysia's Petronas and China's CNPC, which have
currently operating in South Sudan, could also be interested in
Separately the CEO said Total was shutting down oil and gas
production in Syria after the European Union imposed sanctions.
De Margerie said he did not believe a proposed EU embargo of
Iranian oil, related to concerns about the country's nuclear
programme, would have any impact on the Islamic Republic.