A London court has barred South Sudan from entering into new pre-payment deals for oil exports or pledging future oil cargoes to secure financing, in the latest escalation of commodity trader BB Energy’s efforts to recoup a US$100mn debt, Global Trade Review (GTR), a reputable independent publishing and events company, reported on Monday.
An order, issued on May 15 and seen by GTR, says South Sudan “must not accept any new pre-payments or enter into any arrangement that has the effect of being a pre-payment, from any third party in relation to any cargo of Dar Blend or Nile Blend crude oil” before a further hearing on June 5. The order also demands that the country not incur debt secured against oil cargoes.
Oil exports are South Sudan’s primary source of revenue. In recent years, the civil war-wracked country has taken on several loans from banks and commodity traders that were supposed to be repaid by delivering oil cargoes to lenders.
However, in almost all cases, the government has failed to deliver cargoes and instead has sold them to other buyers, GTR has previously reported.
In November last year, BB Energy won a separate court order that prevented South Sudan from selling one cargo that was due to be lifted from a Sudanese port. The trader claimed the shipment should have been used to repay part of a US$100mn loan it provided to the cash-strapped country earlier in the year.
The latest order goes further by covering all the government’s cargoes and warning South Sudan that if it disobeys the order, “you may be held to be in contempt of court and may be fined or have your assets seized”.
It adds that any other person who is aware of the order yet helps South Sudan breach it may also be held to be in contempt of court and may be “imprisoned, fined or have their assets seized”.
The latter provision is designed to deter other traders and banks from facilitating pre-payments for South Sudanese oil, a person familiar with the case said.
Asked for comment, a BB Energy spokesperson said: “Following the favorable court decision obtained by BB Energy in November, we indeed successfully lifted an overdue crude cargo, resulting in a substantial reduction of our outstanding exposure.”
“Today’s order should further support the lifting of additional cargoes and accelerate the continued reduction of such outstanding amounts.”
While the bulk of South Sudan’s oil production is exported by commercial producers, the government retains roughly one cargo per month, according to UN reports.
South Sudan has not participated in the UK proceedings or appointed legal representatives. Authorities also did not engage in an ultimately successful suit brought in 2024 by the African Export-Import Bank over a US$657mn oil-backed loan.
The South Sudanese finance ministry did not respond to requests for comment.
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