Armed Forces Seize Power in Sudan

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Sudan's armed forces seized power in a coup on Monday, just as the North African country was trying to rekindle investor interest in its oil sector after the lifting of US sanctions at the end of last year.

The military dissolved the country's civilian government, declared a state of emergency and detained Prime Minister Abdallah Hamdok at an undisclosed location.

Flights in and out of the capital of Khartoum were suspended amid reports of violent protests breaking out there and in other cities.

In a televised address on Monday, the coup leader, Gen. Abdel Fattah al-Burhan, said he had been forced to intervene because of "infighting" among politicians and incitement to violence.

He stressed, however, that a new government of technocrats would oversee the country until parliamentary elections are held.

Analysts said the upheaval did not come as a complete surprise because tensions had been simmering for months between the government and the military.

"It was clear for some time that the top generals were unhappy with Hamdok, and saw him as a threat to their power base," said one analyst.

The prime minister had been in power since 2019, following another coup that led to the overthrow of long-serving president Omar al-Bashir.

Effort to Woo Investors

A Western businessman who has been doing business with the Sudanese government for the past two years said the timing could not be much worse.

"Hamdok wanted to open things up and get Western investors back in the country. They had to wait ages for US sanctions to be lifted. Now there’s a real chance they could be reimposed. It would be a wasted opportunity."

Sudan's oil production exceeded 400,000 barrels per day before South Sudan become independent in 2011 and took most of the oil fields with it. Its output has shrunk to less than 80,000 b/d today.

However, South Sudan still exports its oil north via a 1,700 kilometer pipeline that runs to a terminal at Port Sudan, providing Khartoum with tariffs as high as $15 per barrel.

At the end of last year, Sudan's Ministry of Energy and Mining announced it would offer 27 exploration blocks, including 24 onshore, in a global licensing round.

South Sudan also unveiled its own exploration tender. But neither auction has gone ahead because of delays caused by the Covid-19 pandemic and a general lack of interest among investors.

The main upstream players in both halves of Sudan are Asian upstream players led by China National Petroleum Corp. and Malaysia's Petronas.

India's ONGC has been locked in arbitration with Sudan for the past three years over Khartoum's nonpayment of debts estimated at more than $500 million.

Military Conflict, Security Risk , Sanctions
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