26-8-2024 (JUBA) A subsidiary of Malaysia’s state-owned petroleum behemoth, Petroliam Nasional (Petronas), has initiated legal proceedings against the Republic of South Sudan. The lawsuit, filed on 23 August, alleges that the African nation obstructed a proposed $1.25 billion sale of Petronas’ local assets and subsequently commandeered the company’s operations.
The dispute came to light as details of the case emerged on the website of The International Centre for Settlement of Investment Disputes, an arbitration body affiliated with the World Bank. The legal action, brought forth by Petronas International Corporation, marks a significant escalation in the ongoing tension between the Malaysian energy giant and the world’s youngest nation.
Sources close to the matter reveal that earlier this month, Nile Petroleum, South Sudan’s state-run oil company, assumed control of Petronas’ local oilfield and associated assets. The move was reportedly accompanied by declarations from South Sudanese officials expressing their intent to seek international partners to maintain and potentially expand production at the affected oil blocks.
The controversy follows Petronas’ announcement on 8 August of its plans to withdraw from South Sudan, bringing an end to nearly three decades of operations in the country. The Malaysian firm’s decision to exit the market has evidently met with resistance from South Sudanese authorities, culminating in the current legal standoff.
