The United Arab Emirates has signed a landmark $12 billion agreement with the government of South Sudan to purchase the country’s underground oil reserves in advance over a 20-year period.
Under the terms of the deal, the UAE will buy South Sudan’s Nile Blend crude at $54 per barrel and Dar Blend crude at $22 per barrel, with a committed supply of 600,000 barrels per day.
Payment, as gathered by WorldClass247Newsforeign desk, will be made through a bank account established in a UAE financial institution.
A key provision of the agreement ensures that if oil prices drop, South Sudan will compensate the UAE with additional crude shipments.
Additionally, South Sudan has pledged a sovereign guarantee valued at $12 billion or its euro equivalent, backed exclusively by oil and insured by an international agency. The guarantee also carries an interest rate of 2%.
This deal strengthens economic ties between the two nations while providing South Sudan with a crucial financial lifeline.
However, the action, as noticed by our correspondent, also raises questions about the long-term implications of pre-selling national resources.