South Sudan ceases talks with Total over B1 and B2 oil blocks

South Sudan’s Ministry of Petroleum has pulled out of talks with French firm Total regarding the development of two oil blocks in the country.

The parties have been on the negotiation table for an exploration and production sharing agreements (EPSA) for oil licences B1 and B2 since February 2013.

Other participants in the discussions include Total partners Tullow Oil and the Kuwait Foreign Petroleum Exploration Company (KUFPEC).

Total previously held a petroleum exploration agreement for the 120,000km² Block B.

However, the oil and gas company terminated activities in the area in 1985 and the South Sudan Government split the area into three licences, namely B1, B2 and B3, in 2012.

Factors that worked against a favourable outcome for the parties include disagreements over the duration of the exploration period and economic terms.

South Sudan Minister of Petroleum Ezekiel Lol Gatkuoth said: “The Ministry of Petroleum regrets that negotiations with Total have concluded with no deal, but looks forward to bringing new investors into talks for these licences.

“South Sudan needs to move quickly to bring investment to blocks B1 and B2, and after a long period of talks, Total has been unable to agree on economic terms and a timeline that work for the country.

“Without this cornerstone in place, the Ministry of Petroleum cannot continue to negotiate an EPSA with Total. We are keen to discuss the exploration of Blocks B1 and B2 with new parties.”