South Sudan suspends pre-sales oil contracts
June 29th 2019 (Nyamilepedia) – South Sudan government has suspended pre-sales oil contracts in a bid to bolster tenders in the country’s oil industry, a senior government official said.
South Sudan President, Salva Kiir Mayardiit, this week ordered investigation into pre-sales of the country’s crude oil as well as banning ex-petroleum minister, Ezekiel Gatkuoth, from leaving the country.
Addressing reporters on Friday following weekly cabinet meeting, information minister, Michael Makuei said the government has come to conclusion to end contract with all non-competitive tenders, saying once a business is offered at fixed prices, it always remains the same, but if it’s sold at an auction, the highest bidder is considered, thus driving up the prices.
“When you sell to a specific company without competition, definitely you agree on certain rates but when it is free competition you give to the highest bidder,” Makuei said.
He revealed that the president had issued an order directing all pre-sales contracts to cease operating, stressing it doesn’t add any revenue or boost the country’s economy, instead, it makes it worse.
“The president directed that all pre-sales contract should be suspended. These pre-sales contracts are not and they are actually destroying the economy,” he added.