Sudan is located in north-eastern Africa between Eritrea and Egypt. The total area of the country is 1,861,484 km2, and it has a population of 34,206,710 (including South Sudan) as of July 2012. The country’s climate is mostly arid desert type.
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The national flag of Sudan.
Image Credit: CIA Factbook. |
Sudan gained its independence from the British in 1956. Devastated by two major civil wars that left millions of people homeless, the country faced severe famine and ethnic conflicts. The North/South Comprehensive Peace Agreement (CPA) formulated and signed in January 2005 paved the way for autonomy for the southern rebels. In July 2011 South Sudan became an independent nation. However, the Sudan People's Liberation Movement-North (SPLM-N) was still active in Sudan and UN peacekeeping force had to step in and take control of the situation. All this had an adverse effect on the economic growth of the country. Sudan has a long way to go before it establishes good infrastructure and stability in all its sectors.
The natural resources of Sudan include petroleum and small deposits of gold, iron ore, silver, copper, tungsten, mica, chromium ore, and zinc. The mining sector does not play a significant role as the majority of the population relies on subsistence agriculture. The GDP of the country as of 2011 was $90.19 billion.
Overview of Resources
The secession of South Sudan has brought about the disparity in both the countries’ economies. Three-quarters of the oil reserves being in South Sudan, North Sudan struggles to maintain its economy. North Sudan has recently started promoting its gold mining sector. Experts from the international mining sector believe that South Sudan is most likely to have several untapped mineral and metal resources such as gold, copper, uranium, and iron ore.
In 2010, the oil sector of Sudan accounted for 7.5% of the GDP, and the mining and quarrying sector accounted for 0.2%. Crude petroleum exports were valued at $9.41 billion and accounted for 82% of the total exports while gold accounted for 9%.
Production details of other mineral and metal commodities for 2010 compared to that of 2009 are as follows:
- Chromate production increased by 303%
- Salt production increased by 296%
- Cement production increased by 240%
- Gold production increased by 76%
- Silver production increased by 53%
- Mica production decreased by 90%
- Kaolin production decreased by 11%
Manganese production also had a steep increase that year while marble production was once again resumed.
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The map of Sudan. Image Credit: CIA Factbook
Metals
Sudan’s gold was mainly produced by artisanal miners. They accounted for about 10,000 kg of gold within the first six months of 2010.
Canada's La Mancha Resources Inc. produced 2,129 kg of gold in 2010 from the Hassai Mine located in northeastern Sudan compared to 1,922 kg in 2009. The company planned to conduct a feasibility study to increase production in 2011. Based on this study, they hope to produce more than 4,800 kg/yr of gold in 2013. The government of Sudan owned a 56% share in the Hassai gold mine.
La Mancha was also conducting a feasibility study of a polymetallic deposit to determine the possibility of mining gold and copper from it. The polymetallic deposit is estimated to contain about 50 million Mt of ore. The company plans on starting production by 2015.
Industrial Minerals
The cement plants in Sudan are privately owned. Al-Rahji Group’s Atbara cement plant increased production to 799,100 Mt in 2010 from 200,900 t in 2009 while Nile Cement Company Ltd.’s Rabak plant increased production to 175,000 t from 8,600 t due to the expansion of the plant’s production capacity.
In 2010, ASEC Cement Co. of Egypt began production activities at its new plant at Takamol. The plant has a production capacity of 1.6 million Mt/yr. Similarly, Berber Cement Co.’s new 1.6 Mt/yr-capacity cement plant in the River Nile State and Jordan’s Mass Global Investment Co. with its new Al-Shamal plant located in Atbara also began production in the same year. The production statistics of the three companies in 2010 are as follows:
- Berber produced 385,000 t of cement
- Al-Shamal produced 214,000 t
- ASEC produced 127,000 t
Fossil Fuels
Following the secession of South Sudan, oil fields in Sudan were divided between the northern and southern sections as follows:
North Sudan will retain the following oilfields:
- Bamboo
- Bamboo West
- Garaad
- Heglig
- Taiyib
- Toma
South Sudan will claim the following oilfields:
- El-Haar
- El-Nar
- El-Toor,
- Khairat
- Khairat Northeast
- Toma South
- Unity
The Greater Nile Petroleum Operating Co. is a joint venture comprising China National Petroleum Corp. (CNPC), Petronas Carigali Overseas Shd. Bhd. of Malaysia, ONGC Videsh Ltd. of India, and Sudan Petroleum Company Ltd. (Sudapet) with each staking 40%, 30%, 25%, and 5% interest, respectively. The company produced crude petroleum in Blocks 1, 2, and 4 in south-central Sudan. These Blocks may be divided between North Sudan and South Sudan.
CNPC also owned Block 6. In 2010, production increased to 41,000 bbl/d from 38,000 bbl/d in 2009. The Petrodar Consortium owned Blocks 3 and 7. Its production grew from 242,000 bbl/d in 2009 to 254,000 bbl/d in 2010. Production is likely to start decreasing from 2013 onwards.
The Khartoum Oil Refinery is jointly owned by China National Petroleum Corp. (CNPC) and Sudan Petroleum Corp. In 2010, the government granted Block 10 and Block 14 to Fenno Caledonian Ltd. of the UK while it awarded Block E to Star Petroleum of Luxembourg.
Investment
The Darfur conflict in Sudan was closely monitored by the international community as it caused a major humanitarian crisis and also because the rebel activity in that region has been difficult to contain. In 2006, the United States of America had banned investment in Sudan’s oil sector as it believed that the revenue from that sector was used to fund military operations in Darfur.
Despite the adverse circumstances, the government of North Sudan is working towards upgrading its mining sector. Over the last two years it has signed more than 50 agreements for gold and iron mining as the country needs to capitalize on its gold reserves. Global gold mining companies from Australia, Europe and the US are already involved in gold exploration activities.
Newly formed South Sudan is now formulating its own mining law, which is likely to be ready by October this year. This would help the mining sector begin functioning in full force. The new government is also keen to focus on other mineral reserves so as to avoid over-dependence on the oil sector.
Disclaimer: The author of this article does not imply any investment recommendation and some content is speculative in nature. The Author is not affiliated in any way with any companies mentioned and all statistical information is publically available.
Sources and Further Reading
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