Malaysia's Petronashas signed an agreement with the Energy & Mining Ministry to develop jointly a new refinery at Port Sudan. India's ONGC Videshwas earlier offered the opportunity by Khartoum to develop the facility (MEED 11:2:05).

Petronas and the government will each hold a 50 per cent stake in the project, which calls for the construction and operation of a grassroots facility with capacity of 100,000 barrels a day (b/d), to process high-acid crude from blocks 3 and 7 in the Melut basin, in which Petronas holds a 40 per cent stake. Commissioning is due in early 2009.

The Malaysian company already has extensive interests in Sudan, with stakes in blocks 1, 2, 4, 5A, 5B and 8 and a retail distribution network. Asian companies have been increasingly active in the country's oil sector recently, as Western companies have faced political opposition to involvement.

Sudan's oil production stands at about 300,000 b/d and is often cited as one of the world's most promising exploration areas, where current production is well below the likely plateau level. Proven reserves stand at about 6,300 million barrels(see Briefing, page 8).