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The government’s draft finance bill, approved by the cabinet on 18 December, looks forward to stronger economic growth, higher exports – including from increased oil output – and a lower budget deficit next year. Prime Minister Motazz Moussa observed that the 2019 budget was “based on real resources [and] disciplined spending”.

Talks to remove Sudan from the list of US State Sponsors of Terrorism continue, but rapprochement has accelerated since ex-president Barack Obama’s surprise parting decision to reduce sanctions. Sudan can expect increased business with the west, as well as its Arab/Islamic and Asian partners, but needs to settle old debt issues. Export financiers and fixed income investors are mooting a debt restructuring package, which Sudan never achieved under the Heavily Indebted Poor Countries Initiative launched in 1996 by the IMF and World Bank.

The Sudanese Thermal Power Generating Company has contracted Germany’s Lahmeyer International to assist as the technical consultant in selecting an engineering, procurement and construction contractor for a planned 300MW gas-fired power plant in the south of Khartoum. Lahmeyer, an independent business unit of Tractebel Engineering, announced on 16 November that it was helping to evaluate commercial bids from four shortlisted bidders for the Albagair open-cycle gas turbine plant.

Sudan is seeking to revitalise its oil industry in a bid to raise production following the easing of sanctions. Oil minister Azhari Abdalla said the government was considering a licensing round in H2 2019 and planned to redraw some of the 16 blocks that are currently open to reduce their size. “We are open for direct negotiations in the meantime,” he told reporters at a press briefing during Africa Oil Week in Cape Town on 6 November.

Lundin Petroleum said on 1 November that it had been notified by the Swedish Prosecution Authority that the company could face fines in connection with the preliminary investigation into its operations in Sudan. The Swedish government in October authorised the country’s prosecution authority to proceed with an indictment against Lundin Petroleum chairman Ian Lundin and chief executive Alex Schneiter over alleged complicity in war crimes in Sudan.

The Swedish government has authorised the country’s prosecution authority to proceed with an indictment against Lundin Petroleum chairman Ian Lundin and chief executive Alex Schneiter over alleged complicity in war crimes in Sudan.In June 2010, the International Public Prosecution Office in Sweden initiated a preliminary investigation on potential complicity in crimes against international humanitarian law in Sudan from 1997 to 2003.

Sudan’s Sudapet has taken over Block 25 in the Melut Basin in White Nile State, acquiring the 30% owned by two Nigerian companies. Express Petroleum & Gas and Mensana each signed up for a 15% share in the block on 26 March 2015, with Sudapet retaining 70%. The block is now “fully Sudanese”, according to a late April statement by the state-run Sudan News Agency (Suna) citing government officials.According to oil minister Abdul-Rahman Osman, Block 25 will produce at least 5,000 b/d by the end of 2018, rising to 10,000-15,000 b/d by end-2019.

The Sudanese Thermal Power Generating Company (STPGC) signed an operation and maintenance contract with Siemens on 13 February for the Garri and Port Sudan thermal power stations. Siemens Southern and Eastern Africa chief executive Sabine Dall’Omo said the agreement would minimise operational risks and maximise plant availability. “As the original manufacturer of the turbines, we are best positioned to partner with STPGC. This agreement is also tangible evidence of our mutual long-term relationship with the country,” she said.

US oil field services company Baker Hughes agreed a memorandum of understanding (MoU) on 13 November to collaborate on gas projects with Sudanese engineering and construction contractor Asawer Oil & Gas Company, a subsidiary of state-owned Sudan Petroleum (Sudapet), according to an Asawer statement. This followed a late-October MoU with Vancouver-based State Oil Company Canada to take on exploration acreage to boost production from several oil provinces.

South Sudan’s oil revenue has continued to fall in H2 2017 as diversions of crude to pay off arrears to Sudan have increased. The government of South Sudan (GoSS) netted just 15,000 b/d of oil production in H2, down from 22,000 b/d in H1. Overall output was modest but steady, at an average 118,000 b/d in H2, the same as for H1. But almost a third of this output is being diverted to Sudan.The drop in GoSS crude share is down to further increases in cargoes diverted to its northern neighbour.

Sri Lankan logistics specialist Hayleys Advantis Group has relocated the 24MW Lakdhanavai power plant from Sapugaskanda to Nyala, in Sudan’s Darfur region, which it said had been without electricity for four months. The plant, comprising four diesel generators, was shipped to Port Sudan then transported 800km by road.

The US has revoked economic sanctions on Sudan and its government, some of which have been in place for 20 years. Other sanctions remain in place, in particular those specifically relating to the conflict in the Darfur region, as does Sudan’s official designation by the US as a state sponsor of terror, but the decision could have a significant positive impact on Sudan’s struggling economy.

In one of his final acts in office, on 13 January, Trump’s predecessor Barack Obama issued an Executive Order authorising “expanded trade with and investment in Sudan” for a six-month period. Under the order, sanctions would be lifted indefinitely from 13 July without the intervention of the incoming president. Obama’s order authorised US persons “to engage in transactions involving persons in Sudan; to import goods and services from Sudan; to export goods, technology, and services to Sudan; and to engage in transactions involving property in which the government of Sudan has an interest,” according to the State Department.

South Sudan plans to divert the vast majority of its share in June crude production to Khartoum in response to calls from Sudan for Juba to step up repayments of arrears. A 600,000-barrel cargo to be lifted from Port Sudan on 7-8 June was due to be awarded to Dutch trader Trafigura, but Juba reallocated the cargo for marketing by the Sudanese Petroleum Corporation (SPC), Sudan’s state-owned oil operator.It is the second time the government of South Sudan (GoSS) has done this.

Sudan has denied India’s ONGC Videsh and its partners an extension of licence to operate an oil block after the initial contract expired in November 2016, India’s Economic Times reported. ONGC Videsh had a 25% stake in the block alongside China National Petroleum Corporation and Malaysia’s Petronas.The Economic Times quoted a senior ONGC executive as saying the process of surrendering the block was under way. The government gave its notice to surrender after months of negotiations with the companies yielded no result.