INVESTMENT CLIMATE

WHY TO INVEST IN THE SUDAN

1 - Investors should not miss the priviledge to invest in the Sudan, the largest country in Africa and the Middle East, and number ten in size in the world, with its unmatched investment opportunities in all sectors.

2 - Sudan is a country with great potentialities whether in form of the extensive uncultivated farmland or the plentiful water resources, differing climatic zones; its huge animal wealth and limitless natural pastureland, forests or the mineral wealth, particulary its large oil reserves, which have not been fully exploited yet. The diversities in wealth are an added advantage.

3 - There are countless and various investment opportunities in the different economic sectors such as the agricultural sector, the industrial sector, energy and mining and in fields of economic services. There are also investment opportunities in the fields of air, road transport, warehousing and the infrastructure sectors. In all these areas the Investment Authority will do the homework and finalize necessary steps on behalf of the investor.

4 - With its abundant resources and immense potential investors in the Sudan are assured of great benefits and successful partnerships

5 - In addition to the availability of raw material, Sudan is home to the most secure and stable environment. It is an ideal climate for investors and businessmen.

6 - An unprecedented Investment Encouragement Act enacted in 1999, which is most generous, transparent and clear.

7 - There are well-oriented economic, social and investment plans and programmes emboiled in the "Comprehensive National Strategy" for the Sudan".

8 - The most recent reformatory steps taken by the state have freed investment in Sudan from all restrictive acts. The Sudanese economy is a market-driven economy, and there is a rapid shift towards privitization in all sectors.

9 - Stable policies, easy access to all cities, quick movement to the different parts of the country.

10 - With its strategic location, Sudan is a gateway to African and Middle-Eastern markets and beyond.

11 - All procedures pertaining to investment in Sudan are prompt and of a simple nature. There shall be facilities, adequate assurances and incentives for both the investor and the invested capital without without sny hinderances.

12 - Transactions in hard currency shall not be restricted, and there shall be an extraordinary freedom of trade with the outside world and at the national level; assured flexibility in the pricing policies.

13 - Availability of highly trained and qualified manpower in the agricultural, industrial, mining, energy and the economic services sectors.

14 - The banking sector in Sudan is firmly established and banking services are accessible in all the states of the country. Moreover there are some specialised banks which are solely devoted to spur investment and development to greater efficiency in particular fields. There are also some state-owned institutions and private companies that finance investment activities. Partners to all are invited.

15 - Big market at home and abroad to the nine neighbouringcountries. The unique geographical location of the country makes it an ideal marketing centre and traverse point for supplying neighbouring countries with commodities and services.

16 - Cheap labour

17 - Organised business sector ready for joint ventures.

18 - Examples of success stories in local and foreign direct investment such as the giant projects of Kenana Sugar, Sudatel, Ariab Gold (French), Daewoo (French), acn be emulated.

19 - More than thirty universities and research centres as reservoir for highly trained and qualified personnel.

20 - Sudan is the largest and key member of the Common Market for East and South Africa (COMESA), in addition to its membership in other international, regional and sub-regional economic and financial institutions.

21 - Advanced telecommunication networks... easy access to and from Sudan to any place in the world.

22 - Affordable destination with easy air connecitions to and from Sudan to Africa, the Middle East, Europe and beyond.

23 - Different varieties of hotel services with affordable prices for tourists and investors.

24 - Roads, seaports and airports connecting the national capital with teh regional states and production centres.

25 - Enchanting locations... The Nile which is the largest river in the world... the confluence in Khartoum of the Blue and White Niles, the Sahara desert... the mountains and the valleys with unmatched scenery... Wealth in wildlife and game viewing.. The country is an ideal destination for tourists and filmmakers.

26 - An investment regime does not discriminate between foreigners and nationals; complete ownership with guarantees against any form of nationalisation or confiscation.

27 - Well-established stock markert as well as insurance and re-insurance companies.

28 - Easy and quick visa procedure.

29 - The country is well known for the traditions of hospitality and warmth of its friendly people.

30 - Pleasant climate in most parts of the year including the Mediterranean, poor savannah, rich savannah and equitorial.

PETROLEUM AND GAS IN SUDAN

Sudan did not stop its endeavour to explore and exploit its petroleum deposit for half a century, under the colonial rule and during the national rule in its different phases in cooperation with some foreign petroleum companies. The great burden of the importation of petroleum materials on the Sudanese balance of payment was one of the main reasons which made the encouragement of investment reaches its summit through the last ten years, as the government considered petroleum one of the basic pillars of its economic strategy and opened the door of the investment to a number of the international petroleum companies.

Exploration:

The actual exploration operations began after the signature of an agreement with the American chevron company in 1974. According to the good results in the central Sudan another bilateral agreement with Chevron was concluded in 1979. After that other agreement were concluded with French total company and the American Sun oil company in 1980-1982.

After the conduction of geological and geophysical surveys in the different parts of the country 95 experimental wells were digged, 46 of them were productive such as the fields of Sawakin, Abu Jabra, Sharif, the Unity, Talh, Hejelij, Adareel and kaigang, 49 wells are dry. But these explorations were not followed by the productive activity.

During the years 1989-1999 the Sudanese government concluded a number of agreements with difference petroleum companies including the two Canadian companies IPC and SPC in 1991 –1993, the Gulf company 1995, the Chinese national petroleum company CNPC in 1995 and the consortium company in February 1997. The international company GNPOC was established in 1997. As a result a number of the exploration companies carried their work in the different parts of the country.

The Real production:

The petroleum production in Sudan began in Abu jabra and Sharif fields, Adareel and Hejilij field. The total production of petroleum in Sudan up to 1998 was over three million barreles, Thus Abu Jabra and Sharif produced 471629 barrels, Adareel 196347 barrels and Hejlij 2517705. By end of June 1999 the real production reached 150 thousand barrels from Hejelij and unity fields. The government expects new production from new fields in the areas assigned to the companies, which will increase the Sudanese oil storage.

The Sudanese oil qualities: The qualities of the Sudanese petroleum differ according to the fields, but its most important qualities can be summarized in the followings: The crude Sudanese petroleum has a medium thickness similar to the light materials.It is categorized as one of the materials that include paraffin wax, which is chemical component of oil, which is good burning material, and of high productivity in complex refining circumstances. The Sudanese crude oil is characterized by including a little quantity of sulfur, therefore its one of the best oils in the middle east because sulfur has harmful side effects on the environment and the engines.

The Sudanese petroleum is also characterized by having the specification of dezil derivative as the sixty’s number is high and that raises the burning competence.

The Export Pipeline:

The length of the pipe which begins from Hejilij to AlObeid and Khartoum refineries to Bashir port on the Red Sea south of port Sudan is 1610km. The pipeline capacity in the first stage is 250000 BPD in the year 2000.

The project cost is about a million dollars and it is executed by a number of specialized foreign companies, all of them worked under the supervision of the great Nile Company for petroleum operations GNPOC.

The line was established and opened on 31 May 1999 and it works successfully.

The Khartoum Oil refinery

The Khartoum oil refinery is located in north of Khartoum 70km away by the eastern side of the Tahadi road – Atbara – AlKhartoum it is 12.5 km away from the Nile. The pipe line of the crude oil export runs to the west of it about 500 meters away the refinery area is half square km, an area of 8 skm has been reserved for the refinery and its extensions, a similar area is reserved for the marketing companies and the projects connected to the refinery.

The share holding companies

The refinery is a share holding enterprise the government of Sudan represented by the Minsitry of Energy and Mining – Sudapet Company – and the Chinese National Petroleum Company (GNAC), that each of the two partners own 50%, contracted for some period of time with a cost of 640 million dollars.

The design capacity and the main units of the refinery

The refinery was designed for 50000BPD equal to 2.5 million tons annually. It is composed of 5 Main Units.

The air unit

Penzin improvement

Dezil Processing unit

Breaking unit

Acids removal unit

The are also other assisting units such as the cermal station.

The refinery covers the domestic demand

The refinery covers 20% of the fuel requirements, provides the National Electricity network with 20 megawatt and covers 90% of the country’s gas oil requirements. The penzin production is fire folds more than the country’s need, also the gas production is more that the country’s requirement that it can covers this need up to 2002.

The refinery will export 500 thousands tones of benzine with high octeen annually, as for the gas surplus some of it will be used in the generation of electricity while the rest will be exported.

Some of the refinery qualities:

The Khartoum refinery is specially designed for the Sudanese crude oil, it is a number of a complex refinery, which is suitable for the introduction of petrochemical industrial in the future.