South Sudanese has lost a court battle to the trading house Trafigura, still furious at having lost its quasi-monopoly of the country’s oil in 2018.
It’s an all-out war between the South Sudanese government and Swiss trading giant Trafigura, which until recently was by far the lead player in the country’s oil sector. On 19 June, the UK’s High Court of Justice ordered Juba to repay the trading house $9.7m worth of debt within 30 days.
Trafigura alleged that Juba had failed to honor part of the volumes agreed to in a series of pre-financing deals and for which the trading house had already paid. In its initial claim, filed in September 2019, it had asked for $46m but Judge Richard Jacobs ruled that South Sudan had already paid the majority of the funds prior to the hearing by means of a separate unrelated sale of oil to the trader in December 2019.
This legal scuffle shows just how much relations between Trafigura and South Sudan have soured. In 2018, President Salva Kiir and his minister of oil at the time, Ezekiel Lol Gatkuoth, wanted to put an end to the pre-financing arrangements that pledged the country’s future output and diversify their oil partners, much to Trafigura’s distress.
The trader was also fired up when a probe was launched in 2019 into the conditions in which the national oil company Nilepet’s cargos were awarded. The Swiss giant has not lost all of its influence in the country, however, it has so far managed to stop the results of the probe, which largely focused on the actions of BB Energy and Trafigura, from being made public. It also pushed for Gatkuoth’s dismissal in June 2019 after he had spent three years in the job. Trafigura felt the former minister lacked respect in its regard.