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South Sudan makes oil pipeline progress

June 14, 2012 at 8:34 AM

JUBA, South Sudan, June 14 (UPI) -- An official from South Sudan said he anticipates funding from a Japanese company for an oil pipeline to reach the east African coast.

South Sudan in January shut down oil production in response to alleged pilfering of oil from the country. The south, when it gained independence last year, gained control over much of the oil-producing area but has no export routes of its own.

A delegation from Toyota Tsusho Corp. was in Juba this week to examine the feasibility of building an oil pipeline to east African ports. South Sudanese Vice President Riek Machar confirmed to the independent Sudan Tribune that the company was ready to help finance the pipeline, which could reach Kenyan ports.

Juba has a memorandum of understanding with the Ethiopian government to build an alternative oil pipeline to ports in Djibouti.

South Sudan relied on oil for nearly all of its government revenue. Issues concerning oil and border demarcation are outstanding despite a peace agreement and the successful referendum for July independence.

Sudan and South Sudan approached the brink of war this year following disputes over contested oil fields.

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