South Africas newly established state-owned enterprise SOE for oil exploration has acquired a majority stake in one of South Sudans most promising prospecting blocks, expanding its regional energy footprint despite heightened security concerns in the area.
The South African National Petroleum Company SANPC formed in May through the merger of PetroSA, iGas and the Strategic Fuel Fund has taken a 90 ownership stake in Block B2, located in Jonglei State.
The remaining 10 is held by South Sudans national oil firm, Nilepet.
The acquisition is formalised through a Production Sharing Agreement EPSA signed with South Sudans Ministry of Petroleum and supports the development of the Nile Orange Energy Project.
The block apparently contains reserves of up to 3.5 billion barrels of oil, making it one of Africas largest known untapped hydrocarbon basins.
This strategic move reinforces South Africas commitment to regional energy security, economic integration and long-term growth, the Department of Mineral Resources and Energy DMRE has said.
The deal is expected to contribute to South Africas energy diversification efforts and strengthen diplomatic and economic ties with Juba, the capital of South Sudan.
However, security analysts have raised concerns about the proximity of the block to several volatile areas that have seen increased violence in recent months.
Block B2 lies within Jonglei State, bordering Unity and Upper Nile State, regions that have been hotspots for armed conflict and ethnic violence.
In March, fierce clashes erupted between militia groups and government forces in Nasir County, Upper Nile State, roughly 150 kilometres north of SANPCs area of operation.
In May, the town of Fangak situated in Jonglei was bombed in an attack that struck a Mdecins Sans Frontires hospital, reportedly killing 12 people. The incident occurred just tens of kilometres from parts of the Block B2 exploration zone.
Humanitarian agencies and energy analysts have noted that while the oil reserves in Block B2 are strategically vital, the area remains heavily militarised and logistically challenging, requiring substantial security coordination for any sustained development effort.
Despite the risks, the potential payoff is considerable. The Nile Orange Energy Project is viewed as a central plank in SANPCs strategy to bolster domestic energy supply, reduce dependence on imports, and establish South Africa as a significant upstream player in the region.
The acquisition reflects not only energy ambition but also an increasingly assertive foreign policy posture by Pretoria, an energy policy analyst at the South African Institute of International Affairs, Dr Lebo Moloi, has said.
If successfully developed, Block B2 could generate billions of rand in export earnings, support local South Sudanese employment, and open the door for further infrastructure investment in a country still recovering from decades of civil war.
SANPC has not yet detailed its timeline for development or production but has indicated that early-stage seismic and exploration activity will begin in late 2025, contingent on regional stability.
Meanwhile, South Sudans Ministry of Petroleum has expressed optimism, saying the partnership would bring new investment, technical expertise, and long-term development to a sector in need of modernisation.
As SANPC embarks on this high-stakes venture, the success of the project may well depend on not just oil extraction, but also diplomatic agility and robust security coordination in one of Africas most turbulent petroleum frontiers.
Concerns have been raised about the cost of the exercise, especially given its proximity to sporadic conflicts, but Minerals and Petroleum Resources Minister, Gwede Mantashe, sees it as a game-changer for South Africas energy sector.
Sphesihle Zondi of the Democratic Alliance has questioned what appears to be the hasty formation of the SANPC, saying it doesnt bode well given South Africas poor SOE track record.
He was particularly scathing of PetroSA being folded into the SANPC, saying its already struggling and now appears to be helping to fund a dangerous exploration exercise.
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