United States Sanctioned South Sudan Oil Sector

The Trump administration has imposed sweeping sanctions on the oil sector in South Sudan. The Bureau of Industry and Security, Commerce added the following fifteen entities to a sanction list: Ascom Sudd Operating Company; Dar Petroleum Operating Company; DietsmannNile; Greater Pioneer Operating Co.Ltd; Juba Petrotech Technical Services Ltd; Nile Delta Petroleum Company; Nile Drilling and Services Company; Nile Petroleum Corporation; Nyakek and Sons; Oranto Petroleum; Safinat Group; SIPET Engineering and Consultancy Services; South Sudan Ministry of Minning; South Sudan Ministry of Petroleum and Sudd Petroleum Operating Co.

These entities are reasonably believed to be involved, or to pose a significant risk of being or becoming involved, in activities contrary to the national security or foreign policy interests of the United States.

These sanctions will likely have paralyzing effects on the exploration, processing, transportation and export or import of crude or processed oil out of or into South Sudan. The entities listed and individuals managing listed entities will have enormous challenges accessing international market, international business will shun doing business with the listed entities and individuals, the sanctions will increase cost of doing business, increase business risks in the case of South Sudan even further and restrict the travel of individuals associated with these entities across international borders.

These effects of the sanctions are further exacerbated by the fact that Government Ministries are added to the list. For all practical purposes, the Government of South Sudan will find it extremely difficult to export and import petroleum. Other governments including Sudan that facilitate the export and import through the Pipe line and processing facilities located in the country, will be forced to halt such support because of the risk of non-compliance with US sanction or from reputational risks which will have implications for its relationship with other international financial institutions.

Oil is the main source of income for a Government that is already broke. By targeting this only source of income that is used to finance the purchase of arms, to service patrimonial relations and to destroy the country, for any practical purpose by adding two ministers – Minister of Petroleum and Mining to its sanction list; the Trump Administration has not only demonstrated its resolve to, to target the root causes of the war, to defund the Government but, it has sent clear message to the Government of South Sudan about what the Government of South Sudan should expect next. 

If the Government of South Sudan was a two-engine plane flying with one engine, now it has lost the second engine and if nothing is done drastically to address the war in South Sudan, the country is few minutes away from crush.

Rpd Miamingi