Sudan Oil and Gas Report Q2 2011

Date: April 22, 2011
Pages: 76
US$ 1,295.00
Report type: Strategic Report
Delivery: E-mail Delivery (PDF), Download
ID: SAB80475013EN

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Includes 3 FREE quarterly updates

The new Sudan Oil & Gas Report from BMI forecasts that the country will account for 2.49% of African regional oil demand by 2015, while providing 6.16% of supply. African regional oil use of 3.06mn barrels per day (b/d) in 2001 rose to an estimated 3.88mn b/d in 2010. It should average 3.96mn b/d in 2011 and then rise to around 4.48mn b/d by 2015. Regional oil production was 7.93mn b/d in 2001, and in 2010 averaged an estimated 9.98mn b/d. From an estimated 10.37mn b/d in 2011, it is set to rise to 11.92mn b/d by 2015. Oil exports are growing steadily, because demand growth is lagging behind the pace of supply expansion. In 2001, the region was exporting an average of 4.87mn b/d. This total rose to an estimated 6.10mn b/d in 2010 and is forecast to reach 7.44mn b/d by 2015. Angola has the greatest production growth potential, with Nigerian exports set to climb if it is able to overcome challenges that have hampered exports.

In terms of natural gas, the region in 2010 consumed an estimated 123.7bn cubic metres (bcm), with demand of 176.2bcm forecast for 2015. Production of an estimated 217.7bcm in 2010 should reach 321.2bcm in 2015, which implies net exports rising from an estimated 94bcm to 145bcm in 2015. Sudan is currently neither a consumer nor producer of gas.

The 2010 full-year outturn was US$77.45/bbl for OPEC crude, which delivered an average for North Sea Brent of US$80.34/bbl and for West Texas Intermediate (WTI) of US$79.61/bbl. The BMI price target of US$77 was reached thanks to the early onset of particularly cold weather, which drove up demand for and the price of heating oil during the closing weeks of the year.

We set our 2011 supply, demand and price forecasts in early January, targeting global oil demand growth of 1.53% and supply growth of 1.91%. With OECD inventories at the top of their five-year average range, we set a price forecast of US$80/bbl average for the OPEC basket in 2011. The unprecedented wave of popular uprisings in the Middle East and North Africa (MENA) that followed the removal of Tunisian President Ben Ali on January 14 has obviously fundamentally altered our outlook, particularly since the unrest spread to Libya in mid-February.

Taking into account the risk premium that has been added to crude prices in response to actual and perceived threats to supply, we have now raised our benchmark OPEC basket price forecast from US$80 to US$90/bbl for 2011 and from US$85 to US$95/bbl for 2012. Based on our expectations for differentials, this gives a forecast for Brent at US$94/bbl in 2011 and US$99/bbl in 2012. We have kept our long-term price assumption of US$90/bbl (OPEC basket) in place for the time being while we wait to see what path events in the MENA region take. We have also retained our existing supply and demand forecasts until the scheduled quarterly revision at the start of April.

Sudan’s real GDP is assumed by BMI to have risen by 5.7% in 2010. We are forecasting average annual growth of 2.8% in 2010-2015. We expect oil demand to rise from an estimated 87,000b/d in 2010 to 111,000b/d in 2015. State oil company Sudan National Petroleum Corporation (Sudapet) is active in the country’s oil exploration and production (E&P) sector, working in partnership with foreign (largely Asian) companies in raising oil output from an estimated 475,000b/d in 2010 to 735,000bd in 2015. There are no plans for significant gas production or consumption.

Between 2010 and 2020, we are forecasting an increase in Sudanese oil and gas liquids production of 49.5%, with volumes peaking at 770,000b/d in 2016, before falling steadily to 710,000b/d by the end of the 10-year forecast period. Oil consumption between 2010 and 2020 is set to increase by 62.9%, with growth slowing to an assumed 5.0% per annum towards the end of the period and the country using 142,000b/d by 2020. Details of BMI’s 10-year forecasts can be found in the appendix to this report.

Sudan now shares last place with Cameroon in BMI’s composite Business Environment (BE) table, which combines upstream and downstream scores. The country holds 12th and last place in BMI’s updated upstream Business Environment ratings. The country’s score suffers from a very poor country risk rating, the absence of gas resources and significant state influence. The risk profile of the separate northern and southern states will no doubt change once the division has been completed. Sudan is just below the mid-point of the league table in BMI’s updated downstream Business Environment ratings, with few high scores and progress further up the rankings unlikely unless the energy market grows more rapidly or new refineries are built. It is ranked equal seventh with Ghana, thanks to low scores for gas demand, country risk factors and nominal GDP.
Executive Summary
SWOT Analysis
Sudan Political SWOT
Sudan Economic SWOT
Sudan Business Environment SWOT
Sudan Energy Market Overview
Global Oil Market Outlook
Balancing Act
Oil Price Forecasts
  Table: Oil Price Forecasts
Short-Term Demand Outlook
  Table: Global Oil Consumption (000b/d)
Short-Term Supply Outlook
  Table: Global Oil Production (000b/d)
Longer-Term Supply And Demand
Regional Market Overview
Oil Supply and Demand
  Table: Africa’s Oil Consumption, 2008-2015 (000b/d)
  Table: Africa’s Oil Production, 2008-2015 (000b/d)
Oil: Downstream
  Table: Africa’s Oil Refining Capacity, 2008-2015 (000b/d)
Gas Supply And Demand
  Table: Africa’s Gas Consumption, 2008-2015 (bcm)
  Table: Africa’s Gas Production, 2008-2015 (bcm)
Liquefied Natural Gas
  Table: Africa’s LNG Exports, 2008-2015 (bcm)
Business Environment Ratings
Composite Scores
  Table: Regional Composite Business Environment Rating
Upstream Scores
  Table: Regional Upstream Business Environment Ratings
Sudan Upstream Rating – Overview
Sudan Upstream Rating – Rewards
Sudan Upstream Rating – Risks
Downstream Scores
  Table: Regional Downstream Business Environment Ratings
Sudan Downstream Rating – Overview
Sudan Downstream Rating – Rewards
Sudan Downstream Rating – Risks
Risk Summary
Political Risk
Economic Risk
Business Environment
Industry Forecast Scenario
Oil And Gas Reserves
Oil Supply And Demand
Gas Supply And Demand
Refining and Oil Products Trade
Revenues/Import Costs
  Table: Sudan Oil And Gas – Historical Data And Forecasts
Other Energy
  Table: Sudan Other Energy – Historical Data And Forecasts
Key Risks To BMI’s Forecast Scenario
Long-Term Oil And Gas Outlook
Oil And Gas Infrastructure
Oil Refineries
  Table: Refineries In Sudan
Service Stations
Oil Storage Facilities
Oil Terminals/Ports
Oil Pipelines
Macroeconomic Outlook
Sudan – Economic Activity
Competitive Landscape
Executive Summary
  Table: Key Players – Sudan Energy Sector
Overview/State Role
Licensing And Regulation
Government Policy
Licensing Rounds
International Energy Relations
  Table: Key Upstream Players
  Table: Key Downstream Players
Company Monitor
CNPC Sudan
ONGC Sudan
Petronas Sudan
Sinopec – Summary
Star Petroleum – Summary
Petrodar – Summary
Total – Summary
Ascom – Summary
Others – Summary
Oil And Gas Outlook: Long-Term Forecasts
Regional Oil Demand
  Table: Africa’s Oil Consumption, 2013-2020 (000b/d)
Regional Oil Supply
  Table: Africa’s Oil Production, 2013-2020 (000b/d)
Regional Refining Capacity
  Table: Africa’s Oil Refining Capacity, 2013-2020 (000b/d)
Regional Gas Demand
  Table: Africa’s Gas Consumption, 2013-2020 (bcm)
Regional Gas Supply
  Table: Africa’s Gas Production, 2013-2020 (bcm)
Sudan Country Overview
Methodology And Risks To Forecasts
Glossary Of Terms
Oil And Gas Ratings: Revised Methodology
Ratings Overview
  Table: BMI Oil And Gas Business Environment Ratings: Structure
  Table: BMI Oil And Gas Business Environment Upstream Ratings: Methodology
  Table: BMI Oil And Gas Business Environment Downstream Ratings: Methodology
BMI Methodology
How We Generate Our Industry Forecasts
Energy Industry
Cross Checks
Sources 76
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